SPANIARDS' pension planning is typically too little and too late, warns recent research – a total of 46% of the working-age population has no other provisions such as private pensions or other investments, meaning they will be relying entirely on the State pot.
And the average Spaniard does not start thinking about saving for retirement until the age of 43.
The majority say they do not have any money left after paying the bills to save up for a pension, whilst others admit they are not that interested or do not think they need to.
Private pensions have, historically, been given little thought, because the State pension has always been sufficient – the average monthly pension, which includes a double payment in summer and at Christmas, varies by region but comes in at between €800 and €1,100 a month – enough to live modestly at the bottom end, and comfortably at the top end, where the retiree does not have a mortgage.
Also, early retirement has always been rare in Spain, and even frowned upon in mainstream society – the option exists for some workers in their 60s to switch to part-time hours and claim part of their pension, but full retirement has always been at 65, now gradually rising to 67.
Private pension annual investment limits have also always been minimal – at the start of the financial crisis, when younger workers were first beginning to consider private pots, the maximum they were permitted to pay in was €8,000 a year.
Despite this lack of planning, well over half – 56% - of Spaniards of working age are conscious that they will be unable to live on their income once they reach State retirement age.
Only 41.5% have a private pension, and just 6.5% have a small company pension – again, a concept which has not caught on in Spain due to the very high Social Security payments employers are required to make on behalf of their staff, inflating the wage bill by up to 50%.
Doubts about whether the State system will survive, with far fewer contributors due to high unemployment and the government's having nearly emptied its reserve fund in less than four years, are beginning to plague working-age Spaniards.
Read more at thinkSPAIN.com