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2016-08-30

Nordea: Finns are adjusting to a higher retirement

Finns now consider 65 to 66 years the suitable statutory age for
retirement. The figure has risen from 63-64 a year ago. Half of Finns
believe they will continue to work until the official retirement age.
Only one-third believe that the statutory pension provided by the
national pension scheme will provide adequate security. An increasing
number of people consider it necessary to independently prepare for
retirement financially.

According to a survey commissioned by Nordea from Taloustutkimus Oy,
Finns consider the appropriate retirement age to be 65 or 66. In a
similar survey one year ago, the figure was 63-64 years. The Finnish
pension reform that will come into force in 2017 will raise the
statutory age of retirement from 63 to 65.

- It seems Finns are adjusting to the notion of a higher age for
retirement. The pension reform may have influenced views on the
matter. Young people should, however, remember that going forward,
retirement age will be tied to life expectancy. Thus for Finns
turning thirty this year, the target age for retirement will actually
be 70, says Olli Kärkkäinen, Private Economist at Nordea.

Faith in the statutory pension scheme is wavering
Nearly 70 percent of Finns do not believe their statutory pension will
be enough to secure their retirement years. Faith in the statutory
pension scheme has clearly eroded among Finnish men over the past
year. Now only 23 percent of men expect their statutory pension to be
sufficient, which represents a decrease of 8 percentage points on
last year.

- The purpose of the national pension scheme is to guarantee a
reasonable standard of living also after retirement. However, it
would seem Finns do not trust that their statutory pension alone will
be enough for them to live as they wish once they have retired, notes
Kärkkäinen.

- There is a distinct generational gap in how people perceive the
sufficiency of the security provided by the statutory pension scheme.
While amongst the 50 to 60 year olds, four-in-ten trust that the
statutory pension will provide sufficient security to upcoming
generations, among the under 50s, the view is shared by just
one-in-three people, notes Risto Kuoppamäki from Nordea's asset
management.

Saving 50 to 200 euros per month towards retirement
An increasing number of Finns are prepared to complement their
statutory pension with additional savings. Almost 90 percent of young
people consider it necessary to independently prepare for retirement
financially, while the corresponding figure for people over 50 is 76
percent.

- In reality, only half of the people who responded to the survey have
prepared to independently contribute towards financing their
retirement days. People typically prepare for retirement by saving
money on their account or by investing in funds, stocks or some
pension saving scheme. Finns usually save between 50 and 200 euros a
month towards retirement. Things Finnish people would do without, if
necessary, once they have retired include travel and acquisitions for
the home, says Kuoppamäki.

The pension survey reviewed attitudes among Finns regarding the
pension reform and retirement age. The survey was conducted as an
internet panel in March. A total of 1,034 working people between the
ages of 23 and 65 responded to the survey.

Further information:
Risto Kuoppamäki, Asset Management, +358 50 3509750
Olli Kärkkäinen, Private Economist, +358 40 735 6030
Susanna Aarnio-Halme, Group Communications, +358 9 4245 1006

Nordea is among the ten largest universal banks in Europe in terms of
total market capitalisation and has around 11 million customers,
30,000 employees and approximately 600 branch office locations. The
Nordea share is listed on the Nasdaq Stockholm, Nasdaq Helsinki and
Nasdaq Copenhagen exchanges. We have a broad expertise across the
wide range of products, services and solutions that we provide within
banking, asset management and insurance. In Nordea we build trusted
relationships through our strong engagement with both customers and
society.

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