You may recall that French citizens protested long and hard this year against new legislation that raised the country’s retirement age from 62 to 64, but to no avail. Now, a new survey shows the majority of Brits believe the retirement age in the UK should be lowered.
The survey, conducted by UK-based investment comparison site Investing Reviews, asked over 2,000 users their opinions and attitudes towards retirement, pensions and investments to better understand the nation’s sentiment around those topics.
“There are endless debates to be had regarding the UK retirement age and the state of pensions, especially considering the recent rise in retirement age in France and the backlash that received”
Investing Reviews CEO Simon Jones
Interestingly, as tensions in France continue to simmer over French President Emmanuel Macron’s controversial (and politically costly) move to raise the retirement age from 62 to 64, UK sentiment regarding retirement ages doesn’t seem to differ much from the French. In the survey, 69% of respondents believe that the UK retirement age (which currently stands at 66) should be lowered. This sentiment also comes alongside 71% of respondents believing that it is harder to retire in the UK now than ever before—which would seem inconsistent with a preference for lowering the retirement age.
However, this seems to be easier said than done according to the survey by Investing Reviews. In fact, 63% of respondents believe that their pension is simply not enough to retire comfortably, citing that they believe they will need additional investments alongside their pension. This may be due to the fact that over half of respondents (56%) agree that they are unable to make as many pension contributions as they would like to.
“There are endless debates to be had regarding the UK retirement age and the state of pensions, especially considering the recent rise in retirement age in France and the backlash that received,” said CEO of Investing Reviews Simon Jones. “These responses offer a fascinating insight into the attitudes that the British public hold towards pensions and retirement ages, particularly the sentiment that it is now harder to retire comfortably than ever before.
Jones added that it will be interesting to see if factors such as the backlash in France to the rise in the retirement age and the increasing difficulty of the cost-of-living crisis have any effect on these sentiments in the future.
Employer contributions perceived as too low
When it comes to employer contributions, well over a third (43%) of respondents would consider working in an entirely different sector to their current career if it meant greater employer contributions.
In a previous study by Investing Reviews that analyzed official government data from ONS, working in ‘public administration and defense (including compulsory social security)’ is the sector that have the highest percentage of employers contributing 20% or more to employees’ pension while employers in the ‘wholesale and retail trade (including motor vehicles and motorcycle repair)’ have the lowest percentage of employer contributions of 20% or more at only 1.3%.
What is particularly interesting is that over a third (35%) of respondents revealed that they do not know exactly how much money is in their pension, while again, over a third of respondents believe they will not be able to retire comfortably in the UK.
This sentiment around the difficulty of retiring comfortably in the UK and the frustration at not being able to contribute as much to their pensions as they’d like are echoed in respondents answers to the question, “If I was able to, I would choose to retire outside of the UK,” where 43% of respondents agreed—raising questions over the increasing rate of inflation and cost-of-living that is perhaps not something that those looking to retire, are able to keep up with if they remain in the UK.
Spain, which ranked No. 6 on International Living’s 2023 list of the best countries in the world for retirement, is the preferred destination for Brits looking to retire abroad.
French increase unpopular but necessary
In France, Macron had long insisted that raising the country’s retirement age by 2 years was absolutely necessary to keep its pension system afloat as the French population ages. Opponents argued for raising taxes on the wealthy or employers instead, but their pleas, protests and strikes in the first half of the year fell on deaf ears. Macron took a hard line in April by invoking a rarely used article in the French Constitution allowing him to push through a bill without a vote in the National Assembly. Opposition to the plan put a sizable dent in Macron’s popularity, but he never backed down.
U.S. retirement age could go up
The sentiments in the UK and France are interesting to keep an eye on as lawmakers in the U.S. begin to more seriously consider a variety of modifications—including the possibility of raising the full retirement age—to address the approaching insolvency of Social Security.
Currently Americans can take early Social Security benefits at 62, but the full retirement age is 66 or 67, depending on the month and year of birth. The Republican Study Committee budget, put forward by House leaders, has called for Social Security’s full retirement age to gradually go up until it is increased by three years. Based on their proposal, people born in 1978 or later would have a full retirement age of 70.
The Social Security Board of Trustees annual report released at the end of March revealed that the Old-Age and Survivors Insurance and Disability Insurance (OASI) trust fund, which currently pays benefits to about 57 million Americans, will become depleted by 2033 unless changes are made.
SEE ALSO:
• Macron Raises French Retirement Age to 64 Despite Strong Opposition
• 3 Proposals to ‘Fix’ Social Security
• 11 Best Places to Retire in the World in 2023: International Living
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.