Commenting on the most recent CSO Pensions Coverage 2020 report, Brokers Ireland said it must first be acknowledged that 20 percent of the population, those who most need pension coverage, were not included in the study because they were unemployed.
The report finds that while 65 percent of workers have pension coverage of some form outside of the State pension, 58 percent of those with no such coverage expect the State pension to be their source of income.
“These figures indicate that a very large portion of the population will be existing more than living in retirement with limited choices available to them.
“For those who don’t own their homes at that stage in life it would be very difficult for them to be able to pay rent and live on the State pension alone,” Rachel McGovern, Director of Financial Services at the organisation which represents 1,225 Broker firms said.
She said the housing crisis which has now stretched on for over a decade, is likely to mean more people will find themselves being of an age when they can no longer secure a 30-year mortgage or have sufficient time left to adequately plan for a pension outside of the State pension.
“The State needs to be planning more urgently for the future, and educating people about planning for retirement.
“One of the concerns we would have about the Government’s auto enrolment pension scheme is not only that it may now be delayed but that while it may increase coverage it might lack adequacy, it may be a ‘one size fits all’, with limited choices available to members,” she added.
She said independent advice needs to be readily available and accessible to those who enrol.
Research carried out in 2016 showed that those who have used a Financial Broker (71 percent ) are more than twice as likely to have a pension compared to those who have not used a Financial Broker (33 percent ).
“They are also likely to have more in their pension pot with the average being €132,650 compared with €111,190 for those who don’t consult an adviser,” she concluded.