Research highlights retirement perceptions as Europe becomes more grey
According to new research by Alight Solutions, in collaboration with the University of Granada, 27% of European employees lack confidence that they will receive a pension when they retire. Furthermore, almost two-thirds believe their pensions will not be enough, meaning they will have to drop their standard of living.
Alight’s Retirement Perception Index was carried out amongst 2,400 employees in companies across multiple sectors from the United Kingdom (UK), Germany, France, Italy, Spain, and the Netherlands. The research highlights the state of retirement perceptions in the region.
The topic of employees’ trust in their state pension systems and interest in additional support for retirement planning is growing in importance, especially as persons over 60 are likely to account for 35% of the population in the region by 2050.
The research found that the lack of confidence in receiving state pensions was highest in Italy (38%), followed by Germany (32%) and Spain (30%), the UK (25%), and France (24%).
Dutch employees were the most confident because they had the best understanding of their pension systems.
According to the research, confidence levels differ regionally, depending on factors such as generation and gender. For example, boomers have the highest confidence in national pension systems, whereas Generation Z has the lowest confidence level among all generations.
Regarding gender, men showed higher mean values across all aspects of the index, indicating that men are more confident in the national pension systems and are more interested in employer-sponsored pension plans than women.
More than half of European workers know they need to make additional contributions but either cannot afford it or lack knowledge on where to invest. More than half of the respondents indicated that they would like to work for companies that can offer them professional advice on managing their pension plans.
Results indicate that UK employees are most interested in employer-provided retirement contributions and advice, and 29% believe they will have enough pension funds available to maintain their standard of living. Fifty percent of respondents believe they won’t be able to retire until after 66, which is when people can start claiming State Pension in the UK.
Ken Brotherston, CEO at TALiNT Partners made comment: “The issue of pensions has long been a ticking time bomb for many western economies and presents significant challenges for governments. On a more positive note, there is a growing recognition that a huge number of older people can still be econimically productive and fulfill meaninful jobs. Organisations like 55/Redefined are at the vanguard of this movement and deserve a lots of support.”