Over 50s see big fall in wealth due to recession

Thursday 03 April 2014 14.20
The average net assets of over 50s fell by 45% from €565,000 to €306,000 in recent years
The average net assets of over 50s fell by 45% from €565,000 to €306,000 in recent years

New research shows that the recession has led to a large decline in wealth for the country's over-50s, but no significant deterioration in their average level of health or well-being.

The report, published by the ESRI, also finds a large decrease in optimism about the outlook for living standards over the next five years.

The ESRI's Alan Barrett and Trinity College's Vincent O'Sullivan analysed data from three representative  surveys of over-50s here over the past six years.

They found their average net assets fell by 45% from €565,000 to €306,000.

They say much of this is explained by a similar fall in the value of owner-occupied housing in the same period - from an average of €476,000 to €224,000. 

Median incomes did not change for the group over the six years.

The "median" is the figure that occurs in the middle of an ascending sequence of all interviewees' incomes and the researchers use it rather than "average income" which they say can be skewed by very high earnings.

Well-being was measured by asking people to rate four aspects of their lives - control, autonomy, self-realisation and pleasure with aggregate scores ranging from zero to an optimum of 36.

The results show the average levels of well-being increased very slightly, from 26.4  to 26.8, between 2007 and 2013.

There was a large decrease in the proportion who felt there was a 75-100% probability that their living standards would improve over the next five years with the optimism figure falling from 27% to just 7% over the six year period. 

Asked about the probability that they would still be working after the age of 62,  in 2007, 34% said that the chances were high. By 2009/11, this had risen to 39%.

The proportion reporting that their health was fair or poor fell from 21% in 2007 to 18% in 2013. There was also a fall in the proportion reporting that that health was excellent, from 21% to 15%. 

But the authors say this was more than compensated for by an increase in people reporting that their health was either very good or good from 58% to 67%.