Early Pension Withdrawals in Chile During the Pandemic

Abstract

Chile, with one of the largest and best funded defined contribution programs in Latin America, held over USD $200 bn in assets at the onset of the Covid-19 crisis, or more than 80$50 bn from the system. This paper explores several hypotheses regarding why people withdrew their pension money early, and it also presents evidence regarding the likely impact of this short-term policy on long-term retirement wellbeing. We conclude with lessons for global policymakers seeking to protect pension assets critical for retirement security