Effective and sustainable private pensions

Abstract

In defined contribution pensions, capital is invested during the working years and during retirement, the capital is gradually withdrawn. Defined contribution pensions therefore require choices how much to contribute to the pension system, how much to drawdown, how to invest the capital, and which risks to insure in the pension system. Because adequate decision-making is key in the provision of adequate defined contribution pensions, the Mobilising the Potential of Active Ageing in Europe project has also spent considerable effort to better understand how people make pension-related decisions and how optimal decision-making can be stimulated. This chapter summarizes the work that has been done in the project on adequate choices for contributions rates, drawdown rates, investment, and insurance in defined contribution pensions.