Check your pension, urges CCPC on foot of new research
September 4, 2023
A Competition and Consumer Protection Commission (CCPC) survey of 757 people has revealed some concerning gaps in retirement planning.
1 in 10 aged 45-64 do not have a retirement plan
While most of those with insufficient retirement planning are from younger age groups, around 1 in 10 of 45 to 64 year olds do not currently have any form of retirement planning.
CCPC Director of Communications Grainne Griffin said,
“It’s concerning that such a significant cohort of people could enter retirement without a pension. It’s never too late to start a pension; it’s a very effective form of saving, and even a few years can make a difference.”
1 in 4 of those without a pension say they can’t afford to start one
Grainne Griffin stated,
“With the cost of living rising, it’s understandable that some may choose to delay starting a pension. While it’s never too late to start a pension, the earlier you start, the further your money will go. No contribution is too small.”
64% have a pension
69% would be happy to pay into a compulsory pension scheme
Auto-enrolment, where a pension is automatically set up and deducted from wages or salary once an individual starts paid employment, is due to be introduced in Ireland in 2024. There is strong support for auto-enrolment across age groups, with 79% of under 25s – the group least likely to already have a pension – saying they would be happy to pay into a compulsory pension scheme.
Women are more likely than men to opt in, with only 16% of women saying they would opt out of such a scheme.
Grainne Griffin said,
“There were some particularly positive findings from this research. We were happy to see that a majority of people over 18 have a pension, and it is encouraging to see strong levels of support for auto-enrolment across demographics. This shows that people recognise the need to plan for retirement.”
57% plan to use cash savings to support their retirement
In light of inflation and the low rate of return on savings, the CCPC expressed concerns with increased intentions to use cash savings to fund retirement.
As pensions are long-term investments and pension contributions are subject to tax relief, money put into a pension will usually go further than the same amount put into savings.
Risk of pension inadequacy with increased cost of living and decreased home ownership
Grainne Griffin said,
“It’s very positive that two-thirds have started a pension, and that number will grow once auto-enrolment is introduced. However, it’s important that people don’t see their pension as a box to tick and forget about – you need to make sure your pension is enough to fund the retirement you want.
Reviewing your pension can also save you money. Especially if you have an older pension, you may be paying much higher charges than needed, so it’s a good idea to check your pension now and question any charges.
Ideally we would all review our pensions every year, but this becomes more and more important the closer we get to retirement. If you’re retiring in the next 10 years, talk to a financial advisor now to check your pension adequacy.”
This research was conducted by Ipsos on behalf of the Competition and Consumer Protection Commission (CCPC). Interviews were conducted with 757 adults aged 18+ who are not yet retired.
For more information read the CCPC pensions research 2023.
The CCPC and financial education: The Competition and Consumer Protection Commission (CCPC) has a statutory role in relation to financial information and the development of financial education and capability in Ireland. The CCPC carries out this role by conducting public awareness campaigns on personal finance issues, supporting the development of financial education programmes for all ages, and providing free, independent financial comparison tools and personal finance information on our website.
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