The obligatory pension applied to the market in early 2008 is designed first and foremost to reduce the rate of inequality and poverty in the retired population. By analyzing a database obtained from a large pension fund, the impact of reform was examined. The findings show that the insurance coverage applied to the whole population of salaried workers, reduced the inequality index in Israel between the years 2008 and 2012. However, early withdrawal of funds places at risk the size of the allowance and could undermine the success of the reform.

Research Synopsis, the Pensions, Insurance, and Financial Literacy Research Center