Nest Insight will launch an ‘opt out’ payroll saving research programme after confirming it will receive expanded support from the Money and Pensions Service (Maps) and The BlackRock Foundation.

The aim of the research programme is to explore whether a joining mechanism similar to that used by automatic enrolment could be facilitated by employers to help workers get started with emergency saving, with Nest Insight noting that the main obstacle for this is inertia.

It explained that the idea of a hybrid workplace savings tool, which would combine short-and long-term savings goals, had high support among both employers and employees, despite sign up levels currently being low.

Nest Insight pointed out that 98 per cent of people who thought the tool would help them had not signed up, leading it to mark inertia, or people’s tendency to keep doing what they were already doing, as the main obstacle.

As such, a new workplace trial set for launch later in 2021 will see employees being given the chance to opt out of payroll saving at any time, similar to the mechanism already in place for automatic enrolment.

If employees do not opt out, they will automatically start saving a default amount into an accessible emergency savings account each time they are paid without having to do anything themselves to set anything up, yet they will be able to make changes to the amount if they want to.

Nest Insight executive director, Will Sandbrook, commented: “The savings tool appeals to many employees, particularly those who are less financially secure, and there’s early anecdotal evidence of a positive impact on financial wellbeing, resilience and confidence among those who’ve signed up to save. But employee take up in our trial, and in similar models, is low.

“Finding ways to support people to overcome the behavioural barriers to getting started with short-term saving is a critical area for financial resilience research.”

He added that the support of The BlackRock Foundation and Maps had “already enabled significant learning in this space” and said the next phase of the research “should make a real contribution to our understanding of what works in facilitating short-term saving and how that can support longer-term financial security”.

Maps senior policy and propositions manager, Michael Royce, said: “The Covid-19 pandemic has shone a spotlight on the impact financial resilience can have in times of uncertainty. Even before the pandemic, Maps set out a goal to see 2 million more people saving regularly by 2030 as part of our UK Strategy for Financial Wellbeing.

“Yet we know there can be several barriers to saving, so we’re pleased to be co-funding Nest Insight’s new research on opt-out schemes to find ways to help more people build up their savings through payroll deductions.”

BlackRock UK head, Sarah Melvin, said: “Through the BlackRock Foundation, we are proud to expand our support for Nest Insight to help more Britons save and be prepared for those unforeseen emergencies.

“Our work together on the sidecar savings trial has been encouraging and our hope is that together, we can overcome behavioural barriers to saving and help significantly more people build a savings safety net.”

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