How much will adults in Ireland need in retirement?

Research from Royal London Ireland shows Dublin residents have the highest expected retirement income, estimating they will need €3,674 a month to retire comfortably.

In a nationwide survey of 1,000 adults, carried out by iReach, three in 10 (31%) said they think they would need around €800 per week to retire comfortably.

A similar proportion (30%) said they would need €600 per week and one in 10 (11%) said they would need only €400 per week, rising to 17% among those aged 55 and over.

Some 16% said they would need €1,000 per week.

“The amounts cited in the survey are not huge, so it seems people are in the main, fairly practical when it comes to assessing how much they’ll need in retirement," said Mark Reilly, pensions proposition lead at Royal London Ireland.

"But the real issue that emerged is just how many people don’t believe they're on track to get there.”

The survey revealed the average amount people said they would need ranged from €3,944 per month among 25–34-year-olds to €3,278 among those aged 55 and over, suggesting that as retirement draws closer, expectations of what's needed become more conservative.

Men were considerably more likely than women to say they would need €800 a week or more (65% versus 52%). On average, men said they would need €3,688 a month, compared with €3,467 for women.

When asked how confident they were that their current pension savings and contributions would deliver the income they need, overall.

Just four in ten (42%) said they felt confident that their current pension savings and contributions would deliver the income they need, including one in 10 (11%) who said they felt very confident.

Almost half (45%) said they were not confident, and the remaining 13% said they did not have a pension at all.

“It's particularly concerning to see that half of people aged 55 and over are either unsure they'll reach the income they need, or don't have a pension at all," said Reilly.

"For those in that position, it's not too late to act. Even relatively small changes now, like increasing contributions or reviewing investment choices, can still make a difference.

"But this should also be a signal for people who still have ten, twenty or thirty years to go. The earlier you focus on this, the more options and the more time you have to close the gap.”

The gap between men and women was stark, with 16% of men describing themselves as “very confident”, compared with just 6% of women.

Half (50%) of men said they felt confident they would achieve their target retirement income, compared with one in three (34%) women.

"The combination of lower expectations and lower confidence among women is noticeable," said Reilly.

"It speaks to how financially under-prepared for retirement many women find themselves, often for reasons that go back decades, including time out of the workforce and lower average pension contributions over their working life.

 Adults in Ireland believe they will need €3,575 per month in retirement.
“Whatever stage you're at, the starting point is the same - look at your pension statement, understand what income it's actually projected to deliver, and compare that to what you think you'll need.

"If there's a discrepancy, the earlier you address it, the more options you have, whether that's increasing contributions, reviewing how your pension is invested, or simply getting independent financial advice to put a proper plan in place.”

* This article was originally published on BusinessPlus.ie.