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Communicating Pension Risk to DC Plan Members: The Chilean Case of a Pension Risk Simulator

Author

Listed:
  • Pablo Antolin

    (OECD)

  • Olga Fuentes

    (Superintendence of Pensions)

Abstract

The purpose of this paper is to discuss a few issues related to how best to communicate uncertainty about projections of future pension benefits to members of DC plans, and especially to present a pension risk simulator developed by the Chilean regulator (Superintendencia de Pensiones, SP) that addresses directly how to convey that uncertainty and aims at eliciting a pro-active response from individuals in terms of contributing more and for longer. Communiquer le risque de retraite aux adhérents des plans à cotisations définies : Le cas chilien d'un simulateur de risque de retraite L’objectif de ce document est de discuter de quelques questions liées à la manière de communiquer l’incertitude autour des projections des futures prestations de retraite aux adhérents des plans de retraite à cotisations définies. En particulier, le but est de présenter un simulateur de risque de retraite développé par le régulateur chilien (Superintendencia de Pensiones, SP) qui aborde directement la manière de transmettre cette incertitude et vise à susciter une réponse proactive de la part des individus pour qu’ils cotisent d’avantage et pendant plus longtemps.

Suggested Citation

  • Pablo Antolin & Olga Fuentes, 2012. "Communicating Pension Risk to DC Plan Members: The Chilean Case of a Pension Risk Simulator," OECD Working Papers on Finance, Insurance and Private Pensions 28, OECD Publishing.
    • Handle: RePEc:oec:dafaad:28-en
    DOI: 10.1787/5k9181hxzmlr-en
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    References listed on IDEAS

    as
    1. Pablo Antolin & Stéphanie Payet, 2011. "Assessing the Labour, Financial and Demographic Risks to Retirement Income from Defined-Contribution Pensions," OECD Journal: Financial Market Trends, OECD Publishing, vol. 2010(2), pages 189-217.
    2. Pablo Antolín & Debbie Harrison, 2012. "Annual DC Pension Statements and the Communications Challenge," OECD Working Papers on Finance, Insurance and Private Pensions 19, OECD Publishing.
    3. Berstein, Solange & Fuentes, Olga & Villatoro, Félix, 2013. "Default investment strategies in a defined contribution pension system: a pension risk model application for the chilean case," Journal of Pension Economics and Finance, Cambridge University Press, vol. 12(4), pages 379-414, October.
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    Citations

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    Cited by:

    1. Stewart, Fiona, 2014. "Proving incentives for long-term investment by pension funds -- the use of outcome-based benchmarks," Policy Research Working Paper Series 6885, The World Bank.
    2. Kees de Van & Daniele Fano & Herialt Mens & Giovanna Nicodano, 2014. "A Reporting Standard for Defined Contribution Pension Plans," CeRP Working Papers 143, Center for Research on Pensions and Welfare Policies, Turin (Italy).

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    More about this item

    Keywords

    communication; defined contribution pension plans; financial education; pension benefit; pension risk simulator; pensions; projections; uncertainty;
    All these keywords.

    JEL classification:

    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • D18 - Microeconomics - - Household Behavior - - - Consumer Protection
    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • G28 - Financial Economics - - Financial Institutions and Services - - - Government Policy and Regulation
    • I28 - Health, Education, and Welfare - - Education - - - Government Policy
    • J26 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Retirement; Retirement Policies
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations

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