How Well-Informed are Pension Scheme Members on Their Future Pension Benefits? Evidence from Ireland

One part of the policy response in many countries to increasing pension coverage will be greater private provision on the part of individuals. This requires that individuals are well-informed about pensions. In this paper, we assess levels of knowledge of pensions using a representative sample of older Irish adults. We find that two thirds of individuals enrolled in pension schemes do not know what amount will be paid out on retirement and/or whether the payments will be in the form of lump-sums, monthly payments, or both. One policy implication is the need for increased information to be directed at certain groups, in particular women and less educated people. More fundamentally, the results suggest that the mandatory elements in pension systems should be extended.