Sugar-coating the piggy bank.

The article discusses the failure of United States citizens to save. The personal saving rate, currently running at around 0.5% of post-tax disposable income, is at a record low. Poorer people, in particular, have too few financial assets. Politicians' main method for boosting thrift is a swathe of tax-advantaged retirement accounts. These accounts will cost some $150 billion in foregone tax revenue. Most of this subsidy goes to richer Americans, who have higher marginal tax rates and who are more likely to save anyway. Economists at the Retirement Security Project, a research group set up by Georgetown University and the Brookings Institution, studied the impact of offering poorer households saving accounts with various levels of matching contribution. Unlike tax credits, matching contributions give poor people an incentive to save. The incentives seem to have worked. The higher the match, the more people saved.