The third pillar of the Dutch pension system is relatively small, even among self-employed persons and employees with insufficient pension accrual in the first and second pillars. Despite recent expansions of the tax scope under the Future Pensions Act (Wtp), actual utilization of the third pillar remains low.

In addition to institutional and tax factors, behavioral barriers play an important role, such as procrastination, buffer anxiety (fear of limited liquidity), sticking to the current situation (even if it is bad), and mental accounting (pension accrual feels too far away, while savings feel safe and flexible). The Dutch authority for the financial markets (AFM) has called on providers of third pillar products to innovate and improve accessibility for the self-employed and other groups with a pension deficit.

International research, by NEST in the UK among others, indicates that hybrid savings and pension products, and automatic mechanisms (such as auto-save and auto-escalation) can be promising tools for reducing these barriers.

The aim of this study is to gain insight into the preferences, acceptance, and expected behavioral responses of self-employed persons (and possibly other groups with limited pension accrual) with regard to innovative third-pillar products within the Dutch institutional context. The focus is on

  • hybrid designs that combine liquidity and long-term pension savings
  • automatic choice architectures that facilitate pension accrual without requiring active and complex decision-making on the part of the participant.