Thoughts on business school, economics, NC State, and everyday life from an economist at NC State's business school
Saturday, June 22, 2013
Retirement savings incentives in Australia
The problems facing Social Security in the US are well known. Australia has developed a retirement savings system that seems to be much more secure and it offers lessons for how we can get our system back on a solid footing. Australia runs two systems, according to a recent BW article. One is a means-tested system funded by taxpayers that provides benefits to 75% of those over 65. The other is a mandatory retirement savings plan that requires 9 percent contributions to self-managed funds. Workers have the option of saving more; some companies provide matches. The result is that the aged have a safety net, while individuals create their own nest eggs.
Steve Allen is Associate Dean for Graduate Programs and Research in the College of Management at NC State University. He has appointments in the Department of Economics as well as the Department of Management, Innovation, and Entrepreneurship. Steve also is a Research Associate of the National Bureau of Economic Research, a non-profit research organization located in Cambridge, Mass.