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Recession delays retirement for one in four Irish workers

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  • Recession delays retirement for one in four Irish workers

IRELAND - A quarter of Irish workers admitted the current economic climate means they will have to retire later than planned, particularly as more than a fifth of those aged 55 and over have not made retirement preparations, a study from Mercer has revealed.

The survey of retirement attitudes of 330 workers aged between 35 and 65 showed just a quarter have made 'significant' preparations for retirement, although 80% of respondents still expect to retire by age 65.

Figures showed 20% of those surveyed believe they will retire past the age of 65, while 25% admitted the recession had forced them to delay retirement plans, with most of these expecting to work for a further four to six years.

Younger workers are most likely to want to retire at an early age, with 35 to 44 year olds setting the ideal retirement age at 57, and those aged over 55 setting it at 63.

However, despite the desire to retire at an earlier age, 44% of respondents want to continue working on a part-time or flexible basis after they retire, while a third want flexible working arrangements in the years approaching pension age.

Aisling Kennedy, senior consultant with Mercer, said: "Given the lack of preparation by the majority, even of people close to retirement age, many of the expectations they have for retirement may not be realised.

"People need to plan further ahead for their retirement, and while much has already been done, government and employers need to do more to raise awareness of the need for retirement provision."

Mercer said the survey showed many people did not understand how a pension scheme worked and would therefore benefit from more personalised investment advice.

"Although most employers and trustees make a lot of effort to educate members about their pension scheme, our research shows there is a lot more to do," Kennedy said.

"Although people generally recognise they will not be able to afford to retire at the age they would like to, they are probably still underestimating the age at which retirement will actually be affordable, especially considering that after 2028 the current proposals allow for increasing the qualification age for state pensions from 65 to 66 in 2014, 67 in 2021 and 68 in 2028."

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