Business Pensions

Sunday 20 October 2019

Young won't pay for pension but still expect nice retirement

Charlie Weston Personal Finance Editor

YOUNG people are turned off by pensions, a new survey has found.

Given €1,000, huge numbers of young people would blow it on a holiday, a survey commissioned by the Irish Association of Pensions Funds found.

The research found that just 15pc of those between the ages of 22 and 40 are making any plans beyond the next five years.

Findings revealed that when asked what they would do with an extra €1,000, 45pc of respondents said they would blow it immediately on something enjoyable like a holiday.

Only one-third said they would consider saving it, while one in five said they would use it to pay bills.

All of those surveyed had a very positive view of retirement, picturing fun, sunshine, holidays, beaches and playing golf or gardening.

Most think they would have no worries or stress, with plenty of time to spend with their grandchildren.

The vast majority of those between the ages of 22 and 40 are completely turned off by the term 'pension', finding the subject over-complex, confusing and boring.

They also lack trust in everything to do with the provision of pensions, with 70pc suggesting that they were simply too risky and insecure.

Disconnect

Chief executive of the Irish Association of Pension Funds, Jerry Moriarty, said: "There's an absolute disconnect between people's rosy view of retirement and what they have to do right now to achieve the level of income needed to fund these later years."

A separate study found that most people are unaware that there is a tax break for investing in a pension.

The Standard Life survey of 1,000 adults found that most do not know or don't think that pensions are tax efficient.

Higher-rate taxpayers can put €100 into a pension fund at a net cost of €59 because of the tax relief.

Irish Independent

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