The European Commission published a report on best practices and performance of automatic enrollment mechanisms in pension systems. Automatic enrollment (also known as auto-enrollment) is a mechanism that encourages pension savings by enrolling people in a pension plan, unless they actively choose not to participate. This study identifies and assesses 32 best practices for the design of self-enrollment pension plans, based on an in-depth qualitative and quantitative assessment of pension plans in selected EU and non-EU countries, and consultations with pension experts. These best practices cover the entire life cycle of the saver, including the initial decision to save for a pension, the choice of funds, greater pension rights, and post-retirement options. Best practices for implementing an automatic enrollment pension plan are also presented. Finally, an indicator chart is presented that assesses each best practice based on key evaluation criteria, including its relative importance in the operation of an automatic enrollment pension plan and its impact on performance measures (participation, savings and return on investment).

Source: https://op.europa.eu; Date: 29.11.2021