A new survey by the ČSOB Pension Company focused on how people perceive life in retirement. Part of the material is the division of people into four groups according to how they prepare for old age and whether they rely on state assistance in retirement. The typology is taken from the study on old-age insurance in the interaction of state administration and citizens, which was created in the past at the Faculty of Social Sciences of Charles University.
The most numerous is the group of carefree riders, who make up about 30 percent of the company. Vigilant guards are right behind them. Roughly a fifth are passive martyrs, and the same number are spontaneous activists. Find out which group you belong to.
They ignore the risks of aging, according to them, old age is still far away and is not worth worrying about. They don’t save for retirement, they enjoy life while they can, and then they want to die quickly. They do not monitor the financial situation of their households, they are voluntary risk-bearers of old age, who rely on them to turn out somehow under the protective umbrella of the state welfare system. It is they who most believe in the help of the state, which, according to them, will not allow the risks of old age to exceed their tolerable limit. They’ll knock it to death somehow.
According to the study, such an approach to risk may be a cultural pattern created under socialism.
Carefree riders are more likely to be men, people living in single-person households, and more passive citizens.
They are very careful about the risks of aging and realize that they are not in control of everything as they would like to be. But they try to do something about it, secure themselves, save. They are risk managers of their own aging. They try to hedge against these risks as much as possible so that the probability of them living to a full old age is as high as possible.
Of all four groups, security guards have the least confidence in the state to take care of them in retirement. They build contacts and social ties, take care of family, have friends and rely on them to help them in the future. These are mostly women who have higher incomes and are very civically active.
Although they are aware of the risks of old age, they do nothing to mitigate them. They take them as a fact that they can’t do anything about. They don’t have enough ability or capacity to secure themselves. They are aware of their risky approach to old age, but tolerate its risks because they have no other choice. These are mostly people with lower education and lower incomes who don’t even have anything to save for their old age.
They suffer economically, healthily and socially and have no choice but to believe that the state will take care of them. At the same time, he doesn’t really believe in it. Their trust in the state’s pension and health care system is second only to vigilante watchdogs. They are the least civically active, they do not have strong social ties, so they generally do not find the necessary support in their immediate surroundings.
They are not afraid of the risks of old age, they believe that they have everything under control thanks to their life experiences and the situation. They have a comprehensive approach to life – they take care of their health, are active in sports, have a stable family life. They most often rate their standard of living as good and also expect to achieve a decent income in their old age. They are not afraid of old age because they think they can control it with a good income.
Their sense of security is also based on a high level of trust in the help of the state, which will at least partially take care of them in retirement. These are often university-educated people with the highest incomes who are very civically active.
The biggest pessimists are people of working age
In addition to the typology, he presented a survey of current data on how people financially secure themselves for retirement. According to him, more than 45 percent of Czechs rely on the state pension. The older generation, which is already approaching it, relies the most on support from the state. On the contrary, younger people want to save more on their own, as they are more skeptical of state aid.
The most popular retirement savings tool is pension savings. At ČSOB Penzijní společnost, it is mainly founded by the so-called sandwich generation, i.e. people between the ages of 36 and 53. These are more than 50 percent of the total number of clients. 26 percent of people between the ages of 54 and 65 also pay it. The number of young people between the ages of 18 and 35 has also increased significantly over the past four years, accounting for roughly a fifth of the clients.
“Czechs still perceive pension savings as a key product for securing the future. Interest in it has grown in recent years in all age groups. But the most among young clients under the age of 26, by almost 20 percent over the last four years,” comments Marcela Suchánková, CEO of ČSOB Penzijní společnost.
According to her, young people now save an average of 631 crowns per month for their pension, the sandwich generation 765 crowns, and people over 54 even 1029 crowns.
The employer’s contribution is also increasing. The employer currently contributes an average of 1,170 crowns to young people, 1,069 crowns to people aged 36 to 53, and 988 crowns to the oldest workers. “Thanks to this, the amount saved for individual clients also increases significantly. Over the last five years, it has increased by more than 40 percent,” adds Marcela Suchánková’s data and gives an example of the appreciation of savings.
If the client saved a thousand crowns for a pension from his own money and the employer sent him the same amount, he would save 480 thousand crowns in twenty years. With the government contribution and revenue, he could get up to a million. However, he would have to choose a dynamic fund. In the case of investing in a conservative fund, he would gain an additional 110,000 crowns, so he would reach almost 600,000. With a balanced fund, the yield would be higher and the client could have a total of 730 thousand crowns.
The survey also found that the sandwich generation, i.e. people aged 36 to 53, have the strongest concerns about their retirement lifestyle. More than half of them expect a significant reduction in living standards upon retirement.
“The heightened concerns of the 36 to 53-year-old generation about the future in retirement may result from the fact that they already have experience supporting their own parents or grandparents. At the same time, they are more sensitive to the changes associated with the pension reform and the security of themselves and their children in old age,” says Michaela Šmídová, researcher at the Center for the Study of Higher Education.
The survey for ČSOB was carried out in August and September by the Nielsen agency on a sample of approximately 700 clients of the pension company.
At Peníze.cz, he focuses mainly on personal finance and the labor market. He has been working in the media since the 1990s. She started at the Czech Press Agency, later went through the editorial offices of MF Dnes, iDnes, worked in Hospodářské noviny and on the website Aktuálně.cz…. Other articles by the author.
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