A new survey from Friends First has revealed that almost 80% of Irish people who do not have a private pension are worried that they will not have sufficient income when they finish working. Around 830,000 of today’s workforce will rely solely on the State pension when they retire.
A lack of education regarding pensions is one of the biggest obstacles, especially among younger workers. 55% of those surveyed aged between 25-35 said they could not afford a pension, and a further 27% said that a lack of time or understanding was the reason they have not taken out a pension.
One possible solution to the low uptake in private pensions may be the government’s recent auto-enrollment proposal. A similar scheme has already been introduced in the UK, whereby a portion of an employee’s pay is automatically directed into a private pension fund. Employees can opt out at any time, but it would significantly increase the numbers enrolled in pension plans. Many people have the intention of starting a pension plan, but due to procrastination or uncertainty, they fail to act.
Although this tackles the issue of not having the time to start a pension plan, it will do little to improve the understanding of how pensions work, and it will probably take a considerable amount of time before the scheme will be operational.
So what can you do? In our Retirement Section, we have outlined the various pension options, and looked at some of the most common issues our clients face. If you would like to discuss your retirement options, please feel free to contact us on (042) 9352287, or email firstname.lastname@example.org