The first approach is known as ‘active choice’, which involves an in-app prompt asking employees whether or not they want to save. The second is an ‘autosave’ approach (also known as ‘opt-out’), where employees automatically start saving at a default rate if they don’t opt out or change the saving amount. Both approaches preserve individual choice and are designed to overcome behavioural barriers to saving seen in the more common opt-in approach to payroll saving.
The new trial builds on Nest Insight’s existing workplace savings research programme, which was initiated to build understanding of the role that saving via payroll can play in supporting employee financial resilience and wellbeing. Working with Wagestream to assess the potential of in-app, instantly accessible savings will make a significant contribution to this evidence base. Over the course of the next two years, research will be conducted to assess participation rates, savings behaviours, and the impact on employee financial wellbeing.
Emma Stockdale, Research Trials Manager at Nest Insight, comments: “We’re really excited to be working with Wagestream to expand our workplace savings research programme. We’ve already seen the positive benefits that saving can have for financial wellbeing, and that autosave is a powerful mechanism for supporting people with getting started.
“This new collaboration with Wagestream will see us address important outstanding research questions, such as how autosave works in different employer settings and with a different touchpoint, in the form of a financial wellbeing platform. We’ll also be able to look at another joining mechanism, known as ‘active choice’.
“The Nest Insight team is grateful to Wagestream and to the programme’s funding partners, the BlackRock Foundation and the Money and Pensions Service, for making this innovative research possible. We’re looking forward to reporting on our findings as the trial progresses.”
Wagestream currently provides their financial wellbeing app to more than 2 million employees.
Emily Trant, Head of Impact & Inclusion at Wagestream, said: "Savings goals and behaviours are core to financial wellbeing. Around a third of workers saving with Wagestream are building up savings for the first time in their life - but we know there's still more we can do. By collaborating with researchers at Nest Insight and Harvard, we're proud to be building evidence around what works to support employees and giving leading UK employers a new way to build out the savings pillar of their financial wellbeing programmes - making work more rewarding for their people in the process."
The trial seeks to strengthen the financial security of low- and moderate-income earners by increasing their accessible savings through automation, and is partially funded by the BlackRock Foundation’s Emergency Savings Initiative. In 2022, BlackRock renewed its commitment to supporting emergency savings research and established a new three-year strategic partnership with Nest Insight.
Gemma Gooch, Co-Head of Global Social Impact at BlackRock, said: “We are very excited about this new trial with Wagestream and keen to see it develop in the months to come. We know how important a financial safety net is for individuals and families, particularly within the current increase in the cost of living. That is why we believe this trial will benefit employees as well as provide valuable insights for other organizations on what they can do to strengthen their customers’ and employees’ financial security.
“BlackRock’s Emergency Savings Initiative aims to make savings easier and more accessible for low to moderate income households by supporting organizations like Nest Insight to develop innovative solutions and field-building research. Our partnership with Nest Insight is aligned with BlackRock’s values and mission: to provide more and more people with financial wellbeing. That is why, earlier this year we extended our commitment as a strategic partner for another three years to continue to fund Nest Insight’s emergency savings programme, including this new trial.”
The Money and Pensions Service (MaPS) is also continuing its support, with a particular focus on identifying barriers for employers and the wider industry and on understanding best practice in communicating to employees.
Sarah Porretta, Propositions, Insights and External Engagement Exec Director at the Money and Pensions Service, said: “Expanding the provision of payroll savings schemes is key to the Nation of Savers pillar of our UK Strategy for Financial Wellbeing where, in partnership with others, we want to increase the number of people on low-to-modest incomes saving regularly by two million. We look forward to expanding our collaboration with Nest Insight and Wagestream to build on the promising findings from earlier research into autosave. Together, we can help people build their financial security and wellbeing through accessible savings that they can draw on in times of need.”
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