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Growing Ageing Population To Impact On Pensions System

Those aged 65 and over are expected to increase from one in eight to one in six by 2030

Ireland’s growing ageing population has been identified as one of the highest threats by the National Risks Assessment 2019. A factor which will impact on pensions, healthcare, education, and housing, among others.

The National Risk Assessment, published by the Department of the Taoiseach, identifies the challenges to Ireland within the next few years under five headings; economic, geopolitical, environmental, social and technological.

Within the report it is expected those 65 and over will grow from one in eight to one in six by 2030. It is estimated people within this age bracket will more than double from 586,000 in 2015 to 1,402,000 by 2055. Furthermore, the number of people aged 85 and over is projected to double.

At the same time the ratio of the working population (15-64) next to people eligible for the State Pension is due to decrease.

These figures pose a serious strain to the pensions system within Ireland with more people expected to be entitled to the State Pension.

The increased demand for funding in relation to the pensions system will fall to a declining share of the population.

According to the report:

“This presents significant funding challenges with the Social Insurance Fund forecast to accumulate a potential deficit of up to €335bn over the next fifty years.”

Meanwhile, the National Risks Assessment highlights that Ireland has a low level of pension coverage. It estimates that only 35% of people employed in the private sector are covered by a supplementary pension.

“This suggests that a high percentage of the working population is not saving enough, or is not saving at all, for retirement, reflecting a significant risk both in terms of the funding and sustainability of pensions in Ireland.”

The report warns there will be a greater dependency and demand on the healthcare system from an ageing population. As it stands, 60% of those aged over 50 report having at least one chronic condition.

It is estimated that within the next decade the number of adults with chronic diseases will increase by around 40%, with relatively more of the conditions affecting those in the older age groups.

The National Risk Assessment concludes:

“These demographic trends, as a driver across a range of risks, therefore highlight the importance of policy responses including increasing the State Pension Age, increasing participation rates of older people in the workforce, increasing savings for private pension provision, delivering on reforms for healthcare and the health system, and consideration of policies that would stem the further decline in fertility and birth rates, in working to mitigate the risks of ageing population.”

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At Mason Wealth Management we have been working with professionals in the pharmaceutical, medical, IT, business and financial sectors for over 20 years.

We pride ourselves on putting you first as our core approach. We have full faith in our process which has delivered successful outcomes for our clients time and time again.

We believe it is only through respect, a can-do attitude and being enthusiastic in our work that we can achieve life-long relationships with our clients.

Mason Wealth Management operate an open communication policy and our ongoing full-service financial planning includes:

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