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FIAP > Featured Content > Bundesbank: Germany must raise the retirement age to 69

Bundesbank: Germany must raise the retirement age to 69

18 August, 2016

The State pension system will be under pressure when the generation born in the 60s retires, warned the Central Bank.

Germany should consider raising the retirement age to 69 by 2060, from the current age of close to 65, if it wants to avoid the risk of being unable to pay pensions in the future, said the Central Bank on Monday.

The State pension system is in good health at present, but it will be under pressure when the “baby-boomers” (the generation born in the 60s) retire and there are fewer younger workers to replace them, said the Bundesbank in a report.

Germany has scheduled a gradual rise in the retirement age to 67 by 2030.
The Bundesbank estimates that this increase will not suffice for the German Government to be able to maintain State pensions at the levels it would like to – at least 43% of average income – from 2050 onwards, due to the increase in the life expectancy of the population.

In order to avoid raising contributions excessively, or seeing pension levels drop, the Government should study extending the retirement age to 69 by 2060, said the Central Bank.

“More changes will inevitably have to be made to ensure the financial sustainability (of the State pension system),” said the Bundesbank in its monthly report. However, the proposal is unlikely to be addressed at a political level before the 2017 elections.

The spokesman of the German Executive, Steffen Seibert, said that “the German Government upholds retirement at 67, which is a sensible and necessary measure considering the changes in life expectancy in Germany. That is why we will implement it as agreed: step by step.”

The Minister of Finance, Wolfgang Schaeuble, was criticized by his Social Democratic partners in the coalition in April, when he proposed linking the retirement age to life expectancy.

Source: La Tercera.

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FIAP > Featured Content > Bundesbank: Germany must raise the retirement age to 69
18 August, 2016

Bundesbank: Germany must raise the retirement age to 69

The State pension system will be under pressure when the generation born in the 60s retires, warned the Central Bank.

Germany should consider raising the retirement age to 69 by 2060, from the current age of close to 65, if it wants to avoid the risk of being unable to pay pensions in the future, said the Central Bank on Monday.

The State pension system is in good health at present, but it will be under pressure when the “baby-boomers” (the generation born in the 60s) retire and there are fewer younger workers to replace them, said the Bundesbank in a report.

Germany has scheduled a gradual rise in the retirement age to 67 by 2030.
The Bundesbank estimates that this increase will not suffice for the German Government to be able to maintain State pensions at the levels it would like to – at least 43% of average income – from 2050 onwards, due to the increase in the life expectancy of the population.

In order to avoid raising contributions excessively, or seeing pension levels drop, the Government should study extending the retirement age to 69 by 2060, said the Central Bank.

“More changes will inevitably have to be made to ensure the financial sustainability (of the State pension system),” said the Bundesbank in its monthly report. However, the proposal is unlikely to be addressed at a political level before the 2017 elections.

The spokesman of the German Executive, Steffen Seibert, said that “the German Government upholds retirement at 67, which is a sensible and necessary measure considering the changes in life expectancy in Germany. That is why we will implement it as agreed: step by step.”

The Minister of Finance, Wolfgang Schaeuble, was criticized by his Social Democratic partners in the coalition in April, when he proposed linking the retirement age to life expectancy.

Source: La Tercera.

FIAP > Featured Content > Bundesbank: Germany must raise the retirement age to 69
18 August, 2016

Bundesbank: Germany must raise the retirement age to 69

The State pension system will be under pressure when the generation born in the 60s retires, warned the Central Bank.

Germany should consider raising the retirement age to 69 by 2060, from the current age of close to 65, if it wants to avoid the risk of being unable to pay pensions in the future, said the Central Bank on Monday.

The State pension system is in good health at present, but it will be under pressure when the “baby-boomers” (the generation born in the 60s) retire and there are fewer younger workers to replace them, said the Bundesbank in a report.

Germany has scheduled a gradual rise in the retirement age to 67 by 2030.
The Bundesbank estimates that this increase will not suffice for the German Government to be able to maintain State pensions at the levels it would like to – at least 43% of average income – from 2050 onwards, due to the increase in the life expectancy of the population.

In order to avoid raising contributions excessively, or seeing pension levels drop, the Government should study extending the retirement age to 69 by 2060, said the Central Bank.

“More changes will inevitably have to be made to ensure the financial sustainability (of the State pension system),” said the Bundesbank in its monthly report. However, the proposal is unlikely to be addressed at a political level before the 2017 elections.

The spokesman of the German Executive, Steffen Seibert, said that “the German Government upholds retirement at 67, which is a sensible and necessary measure considering the changes in life expectancy in Germany. That is why we will implement it as agreed: step by step.”

The Minister of Finance, Wolfgang Schaeuble, was criticized by his Social Democratic partners in the coalition in April, when he proposed linking the retirement age to life expectancy.

Source: La Tercera.