One in Five Europeans Faces Poverty Risk in Old Age
EIOPA warns that women are disproportionately affected and that state pension systems may become unsustainable due to aging populations and declining birth rates
New data from the European Insurance and Occupational Pensions Authority (EIOPA) reveals that one in five people in Europe faces the risk of poverty in their old age. The danger is even greater for women, with their exposure to poverty in retirement rising 30 percent higher compared to men. EIOPA President Petra Hielkema highlighted that worries about the future are mounting, especially in countries where private and occupational pension plans are underdeveloped.
While Northern European nations are better prepared thanks to robust state pensions, supplemented occupational funds, and individual investment plans, Eastern and Southern European countries still rely heavily on low state pension payments. This disparity leaves millions at risk of financial insecurity during retirement, as the continent’s population continues to age and birth rates decline.
In response, the European Commission plans to unveil digital tools and new incentives by the end of the year to help citizens manage their retirement savings and rights more transparently. Recommendations include automatic enrollment models and tax benefits to encourage increased savings. Still, ongoing reforms face political sensitivities at the national level, making progress slow. Experts insist that urgent steps are needed to ensure the long-term financial sustainability of Europe’s pension systems.
