Pension Policy and Personal Finance: Defined-Contribution Plans and Retirement Strategies in the United Kingdom

Ioannis Petrakis and Georgios Panos

Working Papers from Business School - Economics, University of Glasgow

Abstract: This study examines the implications of the United Kingdom’s 2012 pension autoenrolment reform for retirement planning and capability. Utilising data from the 2018 Financial Capability Survey and applying an endogenous-treatment-effect methodology that also corrects for selection, we examine the impact of definedcontribution (DC) pension plan participation on personal financial management. The results identify significant changes in individual financial behaviours, including increased diversification of retirement income sources, enhanced household savings, stock investments, and real estate holdings among DC plan participants. Findings indicate that enhancing financial literacy and regulatory/information transparency and accessibility are critical for informed pension management. The study advocates for improved international accounting standards, robust auditing oversight, and harmonised tax policies to support informed retirement planning and financial resilience.

Keywords: Pension Accounting; Defined-Contribution Plans; AutoEnrolment Policy; Transparency (search for similar items in EconPapers)
JEL-codes: D14 G53 H55 J32 (search for similar items in EconPapers)
Date: 2025-03
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Persistent link: https://EconPapers.repec.org/RePEc:gla:glaewp:2025_06

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