The Escrivá reform hits 94% of the baby boomers without sufficient savings

The pension reform designed by the Minister of Inclusion, Social Security and Migration, Jose Luis Escrivá, which on Tuesday announced the launch in the middle of next year of a public employment fund, which will be fed with at least half a point of the workers’ contributions, worries, and much, the largest generation, the one born between 1958 and 1977. The ‘baby boom’, who will have to retire during the next two decades after years contributing and with high salaries in search of the maximum pension they do not trust that the future benefit will be equivalent to their effort.

The cuts will come through the early withdrawal penalties, already planned for next year, and the equity factor, which has not yet been fully outlined but which will take into account life expectancy to determine the pension. Together with this, they will see how their salary is reduced, due to the contribution to the future pension plan, but very few who consider that they will be prepared to face an increasingly long retirement, with the pensions that remain after the reforms. Thus, more than half of the ‘baby boom’ generation, those who are currently between 44 and 63 years old, lack any savings for their retirement, according to a survey carried out by the BBVA Pensions Institute.

Under the title ‘Preparing for retirement in the baby boom generation’, this survey shows how 42% of the people of this generation do have savings, although not enough, and only 6% of those consulted will be able to live comfortably with them, who have opted for investment in housing or pension plans. Of these savers, 16% have individual pension plans and, of them, two out of three consider that the current annual deductible amount of 2,000 euros is “scarce”. Only 4% have a business plan and, of them, two-thirds see adequate the amount that they can contribute for their workers (up to 10,000 euros per year), while a third find it scarce.

Almost seven out of ten ‘boomers’ assure that they will have no choice but to retire later or collect less pension, something that Escrivá has already warned

This low savings contrasts with the concern about their retirement expressed by having the 66% of baby boomers, who even believe that they will have to retire later or with a lower pension. This perception is correct since Escrivá has already indicated on several occasions that this generation will have to work more or receive lower benefits. “It is curious that, feeling worried and fearing that the system could provide them with pensions until the end of their days, three out of four say that they would retire as soon as possible,” explains the member of the Expert Forum of the BBVA Pension Institute Elisa Chuliá.

That generation “would like to retire well before the age established to obtain a full pension (currently 66 years old), at an age that, on average and realistically, is 63 years. They are worried about retirement, but eager to retire also “, says the expert, while ensuring that this generation is aware that up to now they have lived better than their parents, but that they will do worse than them in their retirement stage.

And it is that, “the ‘baby boomers’ are very conscious of the value of the time of life that they have left, reason why they want to dedicate it to what they like the most, which is not always related to work,” he says. A vast majority of interviewees (88%) consider it necessary to guarantee the purchasing power of pensions, as foreseen by the draft pension reform law presented by the Government.

47% of those born between 1958 and 1977 are not willing to pay more taxes to achieve a higher pension and believe that other items should be cut

However, 47% of them affirm “not being willing to pay more taxes to make this guarantee effective”, so, if necessary, they believe that other items would have to be cut, but not social or environmental protection . The ‘baby boom’ generation constitutes a very large population group (13.3 million Spaniards and 1.4 million foreigners) and in which the proportion of women who work for a fee is higher than in any other period in the history of the to have a record.

But also because its members have had, in general terms, long working careers with relatively high salaries, which entails higher pensions, which will have to be financed with the contributions of much fewer generations. The BBVA Pensions Institute has carried out this survey virtually to 3,391 Spaniards residing in the peninsular and insular national territory of the aforementioned generation.

Source: LA INFORMACIÓN – Lo último by

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