TEN-2021-001 Sidecar Savings Trial Qualitative Research

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Nest Insight is a collaborative research and innovation think tank. We're working to understand the challenges people face in saving for their later lives, and to develop and test solutions to those challenges. Although we sit within Nest and draw learnings from the rich set of data Nest is building, we also work across the industry with other providers, from pensions, banking, fintech and beyond. We share all our work widely to influence industry and policy makers in the UK and internationally. We depend on sponsorships, grants and in-kind support from organisations that share our values.

We work on three main areas to help low to moderate earners achieve the outcomes they hope for at retirement:

We do this through an ambitious programme of research, trials, events and publications, delivered in partnership with academics, think tanks, government and the industry.

1.2.The UK Sidecar Savings Trial

Nest Insight is currently conducting a research trial of a hybrid sidecar savings tool in the UK. Over a multi-year research project we are exploring whether creating a link between liquid and illiquid savings enhances the financial wellbeing of savers.

The research team is led by Professor David Laibson of Harvard University and includes other academics as well as researchers from Nest Insight and the Money and Pensions Service. The work is jointly funded by BlackRock, the JP Morgan Chase Foundation and the Money and Pensions Service. The appointed savings technology partner is Salary Finance.

The trial is exploring whether a hybrid savings tool can address two consumer finance issues:

• According to research by MAPS, only 44 per cent of the UK's working population have £500 or more in liquid savings on hand for emergencies, and 26 per cent have nothing. This means that many may have no choice but to turn to high cost sources of credit/borrowing if a they're faced with a high or unexpected cost.