To increase the savings rate in Ireland, the Government announced the creation of the Special Savings Incentive Scheme where participants can save money for five years and receive a 25% match. These accounts could be opened anytime between May 1, 2001 and April 30, 2002. In the first year, participants had to save at least 12.50 euro each month. The maximum a participant can save in any month during the five-year period is 254 euro.
Participants can choose from a variety of different financial institutions when opening an account. Some accounts earn interest on a fixed rate basis, while some are equity-based and feature a variable rate. Once an account is opened, savings can be moved from one approved financial vehicle to another, if the accountholder feels that changing market conditions warrant a switch. To help participants decide where to open an account, the Consumers Association of Ireland has developed a “Savermark Standard” which it awards to financial institutions that offer accounts with reasonable fees and fair terms.
To date, 1.27 million people have opened an account and contribute an average of 150 euro each month. The program costs approximately 500 million euro a year. Due to the recent downturn in the Irish economy, the program may be amended in the future to reduce costs.
Information from Citizens Information Board on Special Savings Incentive SchemeAbout the Special Savings Incentive Scheme
