New retirement age in Germany: What does that mean for citizens? A financial expert explains it

New retirement age in Germany: What does that mean for citizens? A financial expert explains it

According to a report by www.karlsruhe-insider.de,

The current pension reform stipulates that the retirement age in Germany could soon rise significantly. Experts predict that the retirement age will rise from 67 to 68 for those born in 1983. It is also expected that in the future it could even rise to 69 years, which would mean that people would have to work until this age in order to retire without deductions. This could place a heavy financial burden on low earners in particular and therefore requires an adjustment to the pension system.

Increasing life expectancy and the associated higher retirement age could have a significant impact on the labor market and the financial sector. For the world of work, this means that older employees will stay in their working lives longer and companies will increasingly have to adapt to an aging workforce. In addition, the age structure of the population could change, which in turn could have an impact on consumption and the economy.

In the financial sector, an increased retirement age could lead to greater demand for long-term savings and investment products as people have to save for their pension for longer. At the same time, pension insurance and private pension products could become more important in order to close the gaps in provision in old age.

It remains to be seen how the population will react to the planned pension reform and to what extent politicians will make further adjustments in order to reconcile increasing life expectancy and the retirement age.