Retirement being postponed due to rising living costs

31% of those without a pension say they have delayed starting one due to ongoing inflation

Some 43% of people in Ireland hold no form of pension product, while 63% says that they can’t afford to both save for retirement and meet their monthly bills.

More than two in five people in Ireland without a pension have either delayed starting one or delayed their planned retirement date due to the cost-of-living crisis, according to a survey commissioned by Pensions Awareness Week.

In addition, 4% have actually cashed in their pensions in order to deal with soaring energy and other costs.

The research surveyed more than 1,000 people nationally in late August and early September 2022, and was conducted by Behaviour & Attitudes on behalf of Pensions Awareness Week 2022.

Some of the key findings show that 43% of people in Ireland hold no form of pension product, with almost two-thirds (63%) of that cohort reporting that they can’t afford to both save for retirement and meet their monthly bills. That figure rises to 72% among those aged 35-49.

A total of 31% of those without a pension say they have delayed starting a pension due to the rising cost of living, and a further 11% have pushed out their retirement date for the same reason. Another 4% have cashed in their pensions.

Of those with a pension, the increase in the cost of living has not impacted retirement savings for the large majority (69%). However, 18% have either halted their payments, delayed their planned retirement date, reduced their pension contributions, or cashed in a pension product – due to the cost of living.

The survey also shows that just under two in five (38%) already know they won’t have sufficient money saved for retirement with the same number believing they will need to work longer than they intended due to an insufficient pension.

Other key findings in the survey include: women are less likely to have a pension than men, with just 48% of females reporting having some form of pension product, versus 65% of men.

Fewer than one in five of those without pensions have calculated how much money they need in retirement. Only one in 20 have sought advice from a financial provider on pensions – or discussed retirement options with their workplace.

Ralph Benson, founder of Pensions Awareness Week and Moneycube.ie’s Head of Financial Advice, says: “The research shows there are two sides to the story of the cost-of-living crisis. What’s becoming clear is its long-term effects on people’s financial security. On the one hand there are those who have a surplus each month.

Ralph Benson and Feargal McKenna, founders of Moneycube and the hosts of Pensions Awareness Week.

“Despite the mounting costs of energy and other basics, they can probably survive with just minor tweaks to their finances. On the other, we have people for whom the margins are much tighter and so are being forced to make decisions now that will impact when they can retire and the quality of life they will enjoy when they do.

“This research also reveals that most people haven’t checked the performance of their pension and even fewer know how much they will need in retirement. Pensions Awareness Week gives people a chance to join the conversation about building your retirement plans and check in on your financial health.”