Barely three in 10 people are confident they could fund a significantly longer life as projections suggest around one in four children born today can expect to live to 100 years of age.
“Populations are ageing across the world in developed countries and Ireland is ageing quite steeply, more than others,” says Oisín O’Shaughnessy, managing director of corporate business at Irish Life, which has published a survey on people’s views on living to that age, Life100+: Exploring Ireland’s Longevity Opportunity.
“It is not universally good news for people, living to 100. They qualify their answer in terms of, ‘I am happy to live to 100 if I have enough money to live that long and if I am healthy when I get there.’”
Money is a key concern. The average pension pot for people in the decade approaching retirement is €108,000, Irish Life says.
That is enough to deliver pension income of only €6,042 a year on current life expectancy for that group, which is about 81 for a man and just shy of 85 for a woman.
People in the survey said they thought they would need €315,000 for a comfortable retirement, but even that would deliver an annual pension of only €17,252, again on the assumption you are dying in your early 80s, not living past 100.
“The sums don’t add up in terms of people’s expectation,” O’Shaughnessy says, though he adds that people who do get financial advice tend to have larger pension pots.
Teresa Kelly Oroz, head of public policy at Irish Life, says Ireland is lagging other countries in preparing for the fact that people are going to live longer.
“If we look at what the Government has done around auto-enrolment, that’s fantastic,” she says. “For the first time, we have kind of got pensions coverage now but we have yet to have a discussion around adequacy.
We are living longer. This is how workplaces need to adapt
“There has not been an honest public policy or Government discussion around pensions adequacy and how much you do need to be saving to retirement, and how long you need to be working to be able to sustain that into retirement.”
Working longer and extending the age at which you qualify for the State pension are inevitable, she believes.
Increased longevity is also going to present employers with challenges, according to the survey. But while more than four in five respondents say older workers add value to the workplace, fewer than two in five believe their own employer actively recruited them.
Almost eight in 10 agree that workplaces will need to adapt to the needs of older workers.
But the study has exposed a wide gap between people’s worldview and their personal expectations.
“People think everyone should work longer because of this – but, themselves, they might go one extra year,” says O’Shaughnessy.
He said a big shift is required in workforce planning “around more flexible arrangements, benefiting from people’s experiences and benefiting from the way they can work better at older ages”.