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More than 750,000 people fear they will be still renting or paying mortgage in retirement


Many believe they will be still renting or paying off the mortgage in retirement.

Many believe they will be still renting or paying off the mortgage in retirement.

Many believe they will be still renting or paying off the mortgage in retirement.

A QUARTER of householders believe they will still be paying off their mortgage or paying rent when they retire.

This fear is strongest among women in the 35 to 44 age group, according to research from Aviva.

The news comes as consultants Mercer found the increase in the State pension in last week’s Budget and the decision not to raise the retirement age are affecting the sustainability of the overall pension system here.

The Aviva Life and Pensions Ireland Survey found the 27pc of respondents who still expect to be paying for their accommodation in retirement works out at around 780,000 people.

It is not only young people who fear they will be renting or paying off a mortgage later in life.

About a fifth of people aged over 55 said they expected to be still making mortgage repayments or paying rent in retirement.

The survey of 1,400 people, carried out by iReach Insights, found 44pc of respondents said they would most likely take up a job to supplement their income in retirement.

One in 10 said they would be seeking a full-time job. A third said they had no idea how they would pay.

Many of those who expect to continue to have big financial commitments in retirement will depend on the State to help fund their lives.

Aviva’s Stephen Rice said a Central Bank of Ireland report published in July reported the over-60s currently represented a quarter of all cases in long-term mortgage arrears.

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“Our research findings highlight some very real societal issues that need to be debated at policy and governmental level if we are to avoid people living in poverty in retirement or being forced to work,” he added.

The Mercer CFA Institute Global Pension Index found our State pension faces challenges – Ireland’s system is ranked 25th for sustainability.

“This points to future challenges as the population ages, given the ratio of workers to pensioners in Ireland is set to fall from 4.5 to one today to just 2.3 to one by 2051,” the report said.

Singled out are the decisions to increase the State pension by €5 in the Budget, the retention of the retirement age at 66 for the foreseeable future and the delay in introducing an automatic enrolment system for pensions.

Ireland also ranks behind the OECD (Organisation for Economic Cooperation and Development) average in terms of its gender pension gap.

John Mercer, chief executive of Mercer Ireland, said: “Government policy needs to focus on ensuring the sustain-
ability of our system and some of the key ways to do this
are to continue to increase supplementary pension coverage, improve overall benefit security and incentivise saving.”

A separate Bank of Ireland survey revealed 59pc of people were now thinking more about their financial future than before the pandemic.

More than a third of respondents have been planning more for their retirement since Covid-19 hit. The survey shows people are keen to invest in smarter ways to ensure they can enjoy a comfortable retirement.

However, only half of those surveyed understand how pensions work, with men claiming a better knowledge of this area than women. 

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