Retirement expectations of older workers in Europe. What can microdata tell us?

Abstract

In the last decades, several European countries have reformed deeply their pension system with the objective of enhancing their financial sustainability. As a consequence, the responsibility for pension adequacy was mainly shifted from the governments to the workers, who nowadays have to plan their retirement in advance and recur to investment products on the private market. Individuals’ expectations about retirement can lead to efficient planning only if individuals are aware of the pension system characteristics and their expectations correspond with the economic choice eventually adopted. The research aims to present the information contained in the retirement expectations of older workers collected in the Survey of Health, Ageing and Retirement in Europe. The sample used in the analysis is representative of the population of workers aged 50-65 and living in 9 countries, allowing a European cross-country perspective. Indeed, the analysis shows to what extent individuals’ expectations about retirement are affected by actual characteristics of the Social Security system and, in addition, to what extent retirement age and replacement rate expectations align with their subsequent realizations.