Are we going to retire? And what about pensions?

It's something you've surely heard when someone talks about Retiring in the future: The thing is that our generation... we are not going to have pensions.

And it is clear that Everyone is going to retire. Come on, there will come a time when we have to slow down and rest, because we will get older, law of life! But what about The pensions of those who are under 40 years old today?

As in Goin we care about your financial well-being, we are going to analyze this important issue. With an eye on the future, yes, but attention to What can we do in the present.

Spain: not a country for retirees

Although in Spain we are very familiar and we love to pamper our elders, the reality is that this does not translate into the economic reality we live in.

Keeping an eye on the inflation data for 2022, we have an increase of 8.4%. Something unprecedented, which has not been experienced since 1986. In our country, the increase in pensions this year has been 8.5%, so it seems that these scalability of pensions is guaranteed.

However, we must bear in mind that we had 7.3 million pensioners in 2005. We were 43.6 million Spaniards then, and we are 47.6 million today. To maintain the proportionality of the scheme, retirees should represent about 7.96 million, but they represent 9.6 million people today.

This means that retirees they make up more than 20% of the population, exceeding the employed population. For every retiree, there would be little more than one active worker. And that's not counting other pensioners (people with disabilities, people with long-term leave, minors, etc.). To say unsustainable is an understatement.

No matter how much pensions go up, we can only pay so much

With the data in hand, it seems that the saying applies You don't have to extend your leg more than the sheet gives you. That is to say: As much as we want to, the pension system is absolutely bankrupt.

It's not sustainable, because There is not enough employed and active population to support them. In addition, the pensions of current generations, such as Boomers, will be much higher than those currently being paid, generating more deficits.

Quote today to (hopefully) collect (something) tomorrow

With this in mind, the scenario is somewhat bleak if there is no major shift at the country's economic helm. Taxes will rise, pensions will be adjusted and, if liability is imposed, we must surely face the fact that, as a country, this does not give us the budget for everything.

Since these are relatively uncontrollable factors for the average citizen, there is only the option of managing our personal finances. We don't like pension plans, because its return is zero when applied to inflation (yes, even after deducting). Therefore, if you are going to retire, what you have left is Save and invest. With that, and that little bit that (perhaps) the State will add to you, you can have a well-deserved retirement... although perhaps you will never pay the bills for everything you paid first.