Policy Forum: Saving for Retirement: Policy Options to Increase Retirement Saving in Australia

Abstract

Saving is important to households, governments and the corporate sector. It allows households and governments to smooth consumption in the face of fluctuations in disposable income. These fluctuations may be foreseen, such as when individuals retire because of old age or when governments foresee budget deficits because of an ageing population. Or they may be unforseen, such as the effects of the global financial crisis (GFC) of 2008–2009, which provides a precautionary motive for saving. Saving through retained earnings is important for the corporate sector as a way of controlling debt in the financing of investment.