Fewer People Are Able to Save for Self-Providence

The proportion of Hungarian adults who consider self-providence important has increased significantly, while the number of those who think they are unable to save for their retirement has also risen, according to a quarterly representative survey by K&H's Secure Future Index, the results of which were presented at a press conference in Budapest on Monday.

Quoting the results of the second quarterly survey, Pálma Székely, Head of Life Insurance and Own Sales Channels at K&H Insurance, said that 87% of respondents in the 30-59 age group considered self-providence important, and they believe that the state pension will not be enough to live on. In the same period two years ago, 82% gave a similar response.

Meanwhile, 68% of respondents said they cannot save because they need the money for other areas. This is 2% higher than a year ago and 8% higher than in 2020.

Pálma Székely also said that of the 4.1 million people aged 30-59, 3.56 million are preparing for retirement by saving, but almost 2.8 million are not yet able to save for long-term purposes.

The quarterly report shows that more and more people believe that they will not be able to live adequately on their state pension. 75% of respondents said they would find it difficult or impossible to live on their state pension, compared with 71% in 2021 and 68% in 2020.

The survey also looked at when respondents plan to retire. On average, people aged 30-59 would retire at 57, but they expect to retire at 69. 61% of respondents would retire when the law allows, but 27% thought they would need to work beyond that age to make a living.

The survey found that Hungarians think they could live comfortably in retirement on HUF 305,000 a month, 13% more than in 2021 and 25% more than in 2020. Respondents put the amount they could live on at HUF 184,000, compared to HUF 166,000 in 2021 and HUF 158,000 in 2020.

Voluntary pension funds remain the most popular form of pension savings over state benefits, with a 36% share. 17% of respondents choose pension insurance, while a further 17% are considering other pension savings.

Pálma Székely said that the incentive to save for retirement could be further increased by extending state subsidies.