How can the government make sure that people save enough money to live on when they are old?

Nowadays personal budget management is considered to be a key determinant of personal well-being.

Therefore

, people face the issue of learning some basic assumptions of behavioural economics.

This

essay will discuss the main problems associated with financial illiteracy and propose some possible solutions to avoid them.

To begin

with, saving enough money on the pension enables a person with a variety of opportunities for numerous activities ,

for instance

, travelling, language courses, yoga classes and other hobbies to maintain the brain and physical activity, which ensures a longer and healthier life.

Hence

, the possible solution is to impose a higher tax on the income of the population providing a possibility to increase pension funds.

However

, the support of citizens is not anticipated for

this

measure, as they care about consumption in the present moment and expect future inflation, which devalues savings.

Furthermore

, it is essential to alter the whole culture of money to project progress in the amount which individuals put aside. To be more precise, one component is the historically observed inflation in a particular region,

for example

, if

further

depreciation of a national currency is foreseen, it does not seem rational for people to hold money.

For

this

reason, another solution is to introduce the lesson on financial literacy at schools, but in spite of the obvious advantages, extra time is required and the probability that

this

will decrease the academic performance of children is quite high. In conclusion, I am convinced that it is a major problem in plenty of countries.

Thus

, giving some measures a try

such

as higher taxes or the introduction of a novel school lesson may be beneficial.