IRELAND’S YOUNG PEOPLE are “delusional” about the amount of money they need to put away in order to ensure a suitable income in retirement, a national survey has found.
The Red C poll, commissioned by the Irish Association of Pension Funds, found that only a sixth of people under 24 believed that they would need their retirement income to be the equivalent of 70 per cent of their working income.
This was in comparison to those who were closer to retirement, where 30 per cent of people had squared themselves with the fact that their retirement income would need to be that high.
“While certain expenses such as house purchase and raising children would traditionally be gone at this, modern day retirement has its share of financial demands,” association CEO Jerry Moriarty said.
As we move through our lives, we realise that retirement isn’t some form of “suspension in time” and we will actually need a decent income to live comfortably.
The poll underlined a gender gap across all age groups, with 29 per cent of women acknowledging they would need 70 per cent, compared to 23 per cent of men.
Overall, 22 per cent of respondents thought that they could get by on between 31 and 50 per cent of their working income, while 31 per cent said they would probably need between 51 and 70 per cent.
When asked how much of their annual income they would set aside for retirement, over a quarter of respondents said they would put away less than a tenth of their pay, though 35 per cent said they would save more than 20 per cent of it.
Again, younger respondents were likely to set aside less of their income.
“While it was interesting to note how much people believe they would need in retirement, what was even more revealing was how much they think they need to put away now to achieve this level of financial security,” Moriarty said.