An investigation of policy incentives for delaying public pension benefit claims

Abstract

PurposeThe purpose of this study is to examine the potential and cost of policy incentives for individuals to defer public pension (social security) claims.Design/methodology/approachUsing Internet survey experiments, the impacts of introducing three potential policies to defer public pension claims are examined: (1) a tax incentive for private term pension premiums, (2) a tax incentive for private term pension benefits and (3) a tax disincentive for financial asset holdings. Effectiveness of information provision regarding projection of future financial assets is also examined.FindingsTax incentives have a certain impact on deferment of public pension claims. Among incentives, increase of benefits is the most effective one. Providing information regarding future financial assets reduces incentives.Originality/valueThis study is original in measuring cost for delaying public pension claims according to incentives and information provision.