European confidence rises as EU state pensions outpace the UKs – where do we rank? | Personal Finance | Finance

0
38


European citizens are, according to the latest consumer survey from the Think Forward Initiative (TFI), twice as optimistic about their own personal financial health when compared with the wider financial outlook of their country. TFI recently analysed data from over 8,000 respondents based across eight European countries, and it found while the continent’s financial health was adversely affected by the pandemic, Europeans perceived these effects to be felt by people in their countries to a greater extent than by themselves.

“TFI’s findings also highlighted a mismatch between the rating of the state of one’s own financial wellbeing versus that of all the people in their own country. Individuals in all eight countries consistently regarded their own country to be faring worse than they themselves were as a result of Covid-19.

“In fact, 61 percent of respondents believe that the pandemic deteriorated the financial health of their country, considerably more than those who indicated a fall in their own financial health (36 percent).

“Likewise, in contrast to the majority of Europeans (52 percent) who saw no change in their financial wellbeing, only 28 percent said the same about their country. Perhaps unsurprisingly, it was the Dutch who, again, reported the current highest financial health rating in Europe for their country, at an average of 5.8/10, compared with an average of 4.8 for the wider bloc.”

Maria Ferreira, a Senior Behavioural Economist at TFI commented on the findings: “Whilst Europeans feel concerned about the impact of the pandemic on their country’s financial health, they have remained comparatively way more optimistic about their own financial situation.”

DON’T MISS:
Pension: Small firms are on ‘borrowed time’ as defaults rise [WARNING]
State pension: Qualifying NI years explained – full details [INSIGHT]
Pension warning: Savers urged not to rely on state pensions
 [EXPERT]

Some of this confidence may be warranted when one compares the relative strength between various countries’ pension systems.

In mid-2020, visualcapitalist.com produced research on the best and worst pension plans by country and Samuel Leach, the CEO of Samuel and Co Trading, broke down key insights from this data: “The country with the highest sustainable pension system is Denmark.

“They have a mandatory occupational scheme, which means employers are obligated by law to provide pension plans for their employees. Overall, the Dutch are more content with their lives than the OECD average.

“When asked to rate their general satisfaction with life on a scale from zero to 10, Dutch people gave it a 7.4 score on average, higher than the OECD average of 6.5. Various countries scored high on suitability but rated low when it came to sustainability.

“Ireland came first place for adequacy but was relatively low on sustainability at 27th place. This can be partly explained by Ireland’s low level of occupational coverage. The country also has a rapidly ageing population, which tips the ratio of workers to retirees.

“Spain ranked high in adequacy but was placed exceptionally low in sustainability.”

More recently, a briefing paper was produced by the Government comparing international pension systems, both private and state, to the UK.

In comparing state pensions, the Republic of Ireland, the Netherlands and Denmark were used, as these countries also provide a flat-rate state pension based on a number of qualifying years amassed during a working life.

Based on these parameters it was revealed that, as of April 2021, Ireland’s state pension payments equated to £212.08 per week and the Netherlands single pensioner state pension paid out £254.07 per week, with each member of a “pensioner couple” getting £173.71.

Additionally, Denmark’s state pension pays a basic amount of £172.27 a week but with a full means-tested pension supplement, single claimants could get as much as £366.14 per week, with pensioner couples getting £270.25 each.

By comparison, the current full state pension amount for UK citizens is £179.60.

Additionally, the report examined data from the Mercer CFA Institute Global Pension Index, which annually ranks and scores the pension systems of 39 countries based on adequacy, sustainability and integrity.

The latest ranking placed the UK at 15th, with a “C+” grading, while European countries made up eight of the top 14 places, all scoring a B or higher.

It should be noted that while many European countries achieved a better grade than the UK, six EU countries were awarded a lower grade within this index (excluding Turkey which is considered to be a “candidate” country).





Source link

LEAVE A REPLY

Please enter your comment!
Please enter your name here