New research from Irish Life shows low rates of pension coverage in the private sector, an over-reliance on cash deposits and highlights the fact that only two out of five Irish adults say they have ever invested money before.
According to Gerry Hassett, managing director of retail at Irish Life, this can be partly seen as a hangover from the economic collapse.
“I think it’s risk aversion, I think it’s inertia, frankly,” he said.
“I think people feel that maybe it’s a risk-free option but with deposit rates at an all time low and government bonds at an all time low, it’s not a risk-free decision any more.”
Mr Hassett said both savers and investors would need to start looking more widely in order to find places to put their money if they should hope to make a return on it in the future – pointing out that Irish people typically hold as much as two to three times as much in cash as those in Britain.
Irish Life has also raised concerns about the state of the pensions market in Ireland, saying that coverage is still far too low compared to other countries.
“There is a pensions time bomb, we need to increase coverage in Ireland,” Mr Hassett said. "We’re at 50% and the international norm is anywhere between 75% and 90%.”
He said his company’s call to have this addressed was about more than just adding to the fees they earn, as there is a lot of issues at play which hinge on a solution being found.
“It’s a much more complex thing than that,” Mr Hassett said. “We want to have a vibrant retirement planning market in Ireland, there’s a whole series of issues including the State pension in there, but we will work constructively with Government on this.”
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