France: Retirement: State of Employees and Their Pensions

Pensions have become a growing concern in much of the world, as life expectancy increases and the number of people at work compared to pensioners decreases. France is no exception, according to Asinta Partner, GEREP. The following information of the state of employees and their pensions has been provided to us by GEREP.

Retirement Numbers in France

• In 1970 there were three people in the population at work for every one pensioner over 60. By 2050 this number is expected to be close to 1.5 workers for each pensioner.
• Managers can expect an income replacement ratio of less than 50% at the end of their career.
• The average retirement will last 24 years for men and 29 years for women. An average of 5 – 10 of those years will be spent being dependent on others for care.
• 62% of 35 to 44 year olds see retirement as a cause for concern according to a TNS Sofres study. Only 38% say they have started to make financial preparations for retirement.

The State of Employees

Only 62% of 35 to 44 year olds see retirement as a cause for concern according to a TNS Sofres study. Only 38% say they have started to make financial preparations for retirement. What’s more, is that most employees believe that their employers should provide the bulk of the information they need for retirement. While some HR directors are starting to raise employee awareness of the looming pension problems, many only bring up the issue when a voluntary savings scheme such as a Perco or article 83 is put into place, or when a pension audit is completed 5 to 6 years prior to retirement (when it is too late to react).

GEREP Recommends

Asinta Partner in France makes the following recommendations to help raise employee awareness of their looming pension issues:

• Offer optional schemes (such as Perco or Aticle 83) and use those as a method to open up communication regarding pension issues.
• Give employees regular statements of their vested benefits (retirement points earned) and offer explanations to help them grasp the issues.
• Consider offering pension audits much earlier (perhaps for employees aged 40 to 50?), to help give employees more time to adjust their retirement savings before its too late.

 

You can read the full article from GEREP here.

Do you have questions regarding employee benefits in France? Would you like to get a conversation started on how you can help your French employees work towards having enough money for their retirement years? You can get in contact with Asinta Partner, GEREP via their contact page here.