Forget that comfortable retirement
THE current generation of working age is set to be the first since the Famine to end up worse off than those who are currently retired.
The global financial crisis has been blamed for this situation. Other reasons include the fact that people are living longer.
Then there is the fact that there is a declining number of working-age populations to pay for those entering or already in retirement.
And employers have shifted away from defined benefit to defined contribution plans. These trends have combined with persistent global economic uncertainty and constrained state budgets.
Together, these factors have created greater urgency for individuals and families to take action to provide for their personal retirement security. But people are cash strapped, and pensions are the last item on their agenda.
And the signs are this situation is not about to change very fast.
Around one million people have no private pension provision in place. Many of those of working age who thought they were in line for a financially comfortable retirement are finding out that nothing of the sort is on the way. There is a shock in store for many on this issue because defined benefit schemes are falling like nine-pins.
Social Protection Minister Joan Burton is showing little eagerness to tackle this. She has spent almost two years talking about changing the situation where pensioners get priority over the assets of a bust scheme, leaving little if anything for those who have yet to retire.
But she has again put action on this score on the long finger.
In the meantime, more defined benefit schemes close – and the yet-to-retire members of these schemes and others with no pension are in line for a penny-pinching retirement.