PENSION FUNDS AND BEHAVIOURAL FINANCE: ANALYSIS OF PENSION COMMUNICATION STRATEGIES IN RELATION TO THE ROLE OF BIASES IN RETIREMENT DECISIONS

Abstract

One of the most current issues in Italy and abroad is the importance of encouraging workers to adhere to a supplementary pension fund. The main reasons are the steady increase in life expectancy and the risk of failure of state pension systems. There are several deterrents for the adhesion of workers and for their active participation also in contribution, investment and decumulation choices: behavioural finance findings suggest that individuals are unable to come to a decision rationally but they are subject to the influence of some “biases” that predispose them to make mistakes even in the social security sector with negative consequences in their retirement age. It’s increasingly evident that the financial education of workers is essential to address biases but this is not enough: an important role is played by a pension communication able to convince workers to think in time about their future. Some of this communication strategies, in Italy and in other countries, are going to be analysed focusing the attention to the messages, who transmits them and the tools used. The strategies are also examined in relation to pension funds trends and performances. The purpose of the analysis is to understand whether communication strategies of pension funds have been developed taking into account the role played by biases in each phase of retirement savings decision and comprehend whether their means of communication are actually able to overcome them.