Social Security Design Influences Household Saving Rates and Retirement Decisions
The design of social security programs affects how much people save for retirement. When social security programs are more like private retirement plans, they tend to offset household saving rates. A study looked at different countries and found that when social security programs act more like mandatory savings plans, older women are more likely to keep working. This suggests that when public programs mimic private savings plans, they can encourage people to save more for retirement and stay in the workforce longer.