If no restructuring is carried out in the social security system, the average pension is expected to rise from 69.4% of the last salary to 38.5% in 2050. On World Savings Day, DECO warns that saving for retirement is “urgent”. Small savings, appropriate decisions and choices will make a difference when you get there.
Saving for retirement is “increasingly urgent”. Without this, you will not have a “dignified standard of living” similar to that of working age. DECO is the one who says it. THE Portuguese Association for Consumer Protection defends the existence of tax incentives, transparent products and financial educationgiven predictions of a “drastic” drop in pension replacement rate in Portugal.
Although saving for retirement is a “taboo themesoften associated with those with high income“, it is imperative to talk about it on World Savings Day.
If not plan your retirement in time will not have a “dignified standard of living, similar to that of working age”. Small savings, appropriate decisions and choices will make a difference when you get there.
Saving for retirementshould be seen as a “goal throughout active life”starting as soon as you enter the job market”, argues DECO, which identifies a “high financial vulnerability” of those who retire without their own savings.
Why? Here’s the explanation
“In the face of fall in state pensionsit is imperative that the Portuguese change their financial planning and create new social protection policies”, he warns.
Despite having had a maximum increase of 3.85% this year, the European Commission’s projections point to a “drastic” drop in pension replacement rate in Portugal.
If no restructuring is carried out in the social security system, the average pension should go from 69.4% of the last maturity to 38.5% em 2050alert DECO.
DECO’s proposals to “mitigate challenges” in the future
Given this scenario, the Portuguese Association for Consumer Protection presents some measures to “mitigate the difficulties and challenges of younger generations” in the future. In practice, it defends the existence of progressive tax incentives, transparent products and financial education for all ages.
- Reform the way we think about reform – that is, planning and understanding the financial future through financial literacy and future protection programs egsecuring independent support for savings choices and financial products;
- Right to retirement, right to save – a Savings “must be a social right and a public policy priority”. According to DECO, this can be done through tax incentives that benefit all income brackets, p.simple, clear and transparent savings products, with no hidden feesreducing the tax burden on time deposits;
- Small decisions, big differences – that is, small contributions have “real long-term impact.” To do this, they help awareness campaigns about the importance of saving from an early age and theensuring access to impartial, clear and independent information.
