Retired women have much lower income than men
HALF of retired men have either a private or a public pension on top of the money they get from the State – but women tend to have far less to live on in retirement, a new survey shows.
Income for the average retired man is close to €400 a week, the research found. Over a year, this amounts to around €20,500 according to the survey carried out as part of The Irish Longitudinal Study on Ageing (TILDA) at Trinity College Dublin.
But the average income from all pensions for women is €254 a week, which works out at around €13,200 a year.
This equates to just two-thirds of the income that retired men get, according to the research by Prof Alan Barrett and Sanna Nivakoski.
Some 8,500 people were interviewed for the survey between 2009 and this year.
The research found that the quarter of pensioners with the lowest income were on €198 a week, or €10,300 a year.
But the 25pc of pensioners interviewed who were on the highest income had a weekly income of €938, which works out at close to €49,000 a year on average.
Half of male pensioners have a supplementary pension, apart from the state contributory pension. This is either a public sector pension, or a private one.
But only a third of the women have a private or public sector pension to complement their state pension.
Former public sector employees are far more likely to have a supplementary pension.
Having worked for larger firms is also an important determinant of receiving a supplementary pension, as are education and occupation.
Prof Barrett said: "The results in this study show that the income circumstances of Ireland's retirees vary considerably. Having a supplementary pension drives a lot of the differences.
"This should be kept in mind when policy decisions are being made, including decisions on public spending cuts. And for people who are at work, the figures serve as a reminder of the importance of pension saving."
Pensioners are likely to be hit in the Budget next week. They get a special age-related tax credit, which reduces their income tax bill, and do not have to pay pay-related social insurance (PRSI), which is 4pc.
This means that taxpayers under the age of 65 who earn €40,000, pay €2,800 more in income taxes than someone who is over the retirement age with the same €40,000 income.
And the over-70s pay a lower rate of universal social charge. This means someone over 70 pays €3,500 less in tax than a younger person, if they are both earning €40,000.