Ireland is a great place to retire … on paper at least

If Ireland is the fourth best place in which to retire, then many countries are in big trouble. Yet that’s what the latest annual Global Retirement Index from investment advisers Natixis reported this week.

Figures from the Central Statistics Office note workplace pension coverage in the State being just 56 per cent and this figure is skewed wildly by public sector employees where coverage is closer to 100 per cent. Looking purely at the private sector, the data, which comes from the 2021 pension coverage survey, indicates coverage of just 35 per cent.

And that’s any level of cover, regardless of whether it is sufficient in scale to allow people retire with reasonable financial comfort.

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Outside of that, everyone is relying on the State pension and demographic pressure will make that more of a lottery, which is why the Government is finally getting (almost) serious about brining in auto-enrolment — a mandatory workplace pension.

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The number of people over the age of 65 in Ireland has jumped by 35 per cent in the past decade — more than three times the rate of the population as a whole — and the fastest in Europe. The over-65s are expected to double in number again over the next 20 years.

The Natixis report argues that rising interest rates — which lift the yields of low-risk bonds that are a key driver of pension income — as well as easing inflation and stronger economic fundamentals mean the pension investment picture is strong on a macro level.

Clipping benefits

Yet even in the same report, the feedback from 8,550 people surveyed in 22 countries tells a different story. Those still at work fear they won’t have enough saved for retirement, in large part because of inflation. They worry they will have to continue to work into their old age and that government could cut current levels of benefits.

[ The benefits of working past retirement age ]

And just short of half of those who have retired say they are struggling financially in retirement to some degree, with close to two-thirds worrying about the rising cost of living.

Asserting that we are doing well on the basis of national data on things like the economy as a whole, life expectancy, healthcare spending per capita and the quality of our air and statistics of the habitat is one thing. But it doesn’t necessarily tell you what the quality of life is for an older person with often very limited means watching the price of ordinary things continuing to rise faster than their income ever can.

All of which goes to show that you can make figures add up to almost anything you like, but you should be cautious about drawing too may conclusions.