The ERGO “Risk Report” reveals that Germans save very little for the future, despite fearing poverty in old age

This representative survey on risk literacy and personal responsibility among Germans was conducted under the scientific direction of Professor Gerd Gigerenzer, Director of the Harding Center for Risk Literacy at the Max Planck Institute for Human Development. The Risk Report 2019 is the second in the series and the full report will be published in September.

What Germans fear most for their old age
Top of the list is the fear of suffering ill health in old age (64 per cent) followed by the fear of poverty (39 per cent). The fear of experiencing poverty later in life was especially strong among young people aged between 18 and 30. The over-60s are 42 per cent more likely than all other respondents to fear that they will no longer be able to lead an independent life when they are old. Nearly one third (29 per cent) of Germans is deeply concerned by the prospect of loneliness in old age.

Failing to save
Although 39 per cent of Germans expressed a fear of experiencing poverty in old age, slightly more than a quarter of the respondents (28 per cent) do not put aside anything monthly for personal old-age provisions. This applied most frequently to the age group 18-30 (33 per cent) and the over-60s (36 per cent). Women often neglect to make personal provisions for old age: 32 per cent save nothing; the same applies to 24 per cent of men.
People with a medium to high monthly household net income clearly have a greater scope when it comes to saving: they set aside a larger sum for personal old-age provisions than those earning a low income.

“The core finding of the study, namely that too few people are saving for their old age, is truly alarming. In our age of zero-per-cent interest rates, volatile stock markets and rising life expectancy, personal provisions for old age with a life or pension insurance is an essential component to supplement a government pension”, said Michael Fauser, Chief Executive Officer of ERGO Vorsorge Lebensversicherung AG, commenting on the results of the study. “Even small monthly premiums can help to build a dependable nest egg. This approach allows fluctuations to be balanced out over the years and across society, and it alleviates the threat of living longer than one’s savings last.”

Restricted spending in old age
More than one in two respondents (55 per cent) believe that they will have to economise in old age and limit themselves financially. At 62 per cent, the 41-50-year-olds believed that they faced the risk of being financially worse off in old age, a considerably higher proportion those just starting out in their careers (18-30-year-olds: 47 per cent). Broken down by occupational groups, the results show that civil servants have the highest confidence that they will be able to maintain their standard of living in old age (61 per cent), followed by the self-employed at 53 per cent.

The full document, with more information and detailed results for the categories Money, Health, Safety and Digitalisation, will be published on 10 September at www.risikoreport.de