Other policies that reduce the incentive for households to save include

Question

Quizplus · Accepted Answer

A) Means-testing reduces the incentive for households to save because it reduces the benefits that households receive from government programs, such as social security and welfare, based on their income and assets. This means that households may be disincentivized to save since it could reduce their eligibility for these programs.

B) College and university financial aid administration policies also reduce incentives for households to save because these policies provide more aid to students with less savings and assets. This means that households may be disincentivized to save since it could reduce their eligibility for financial aid.

C) Inheritance taxes reduce incentives for households to save since they reduce the value of assets that households can pass on to their heirs. This means that households may be disincentivized to save since they may not see the full benefits of their savings passed on to their heirs.

Therefore, all of the above policies reduce the incentives for households to save.

Other Policies That Reduce the Incentive for Households to Save