• Pension systems face a tremendous challenge, which is to expand their coverage and increase the frequency and amount of contributions to provide adequate protection to the population during old age.
• Considering the high labor informality in the countries of the region (which leads to low pension coverage) and the difficulty that many times poses the necessary increase in mandatory contributions to individually funded pension systems, a new and complementary alternative that arises to increase pension savings is to make contributions based on daily consumption.
• This policy would move towards universal coverage, where all workers, regardless of their employment status, can contribute to their pension fund (long-term savings for future consumption) through their current consumption.
• Now, saving through consumption does not have the capacity to exclusively finance pensions, but must be considered as one of the sources for their financing. Furthermore, considering that the proportion of consumption in relation to GDP is around 60% in developing countries, this mechanism contributes to making pension systems more inclusive with informal workers, and to enhancing the possibility of saving in these sectors.
• To implement savings through consumption there are mainly two mechanisms. One is that each purchase is associated with a tax identification number, and that part of the consumption tax paid by the buyer goes to their individual savings account for pensions. The second option is to use mobile application technologies that already exist in the private sector and that exploit the lessons of behavioral economics to increase savings.
• This note describes the proposals and concrete experiences to save through consumption, which include Chile, Peru, Mexico, Spain and China.

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