Numerous independent workers seek insurance coverage.
The financial security of self-employed individuals in Germany is a growing concern, with many seeking a more robust pension provision tailored to their needs. A recent survey conducted by YouGov on behalf of insurance group Ergo Versicherungen highlights the preferences and concerns of the self-employed in Germany.
Key Findings
- Security: Around two-thirds (64%) of the surveyed self-employed want a pension provision that offers security, while 44% prefer flexibility in both the savings and payout phases.
- Integrated Protection: More than half (58%) of the surveyed self-employed want integrated protection against seizure of saved capital in case of unemployment for a mandatory pension provision.
- Flexibility: 52 percent of the surveyed self-employed prefer flexibility in contribution payment for a mandatory pension provision.
Current Challenges and Concerns
The survey results indicate widespread concern among independent workers in Germany about old-age poverty. Nearly half (49%) of the respondents expect to have insufficient capital in old age, and 46% are currently worried that they are unable to save or save less for retirement as a result of the pandemic.
Sadly, around one in ten (9%) of the surveyed self-employed are using savings intended for retirement due to the pandemic, and 3% have no income at all. Almost half (49%) of the respondents are worried that their money will not be enough in old age.
Preferred Features in a Pension System
The survey suggests that self-employed individuals value flexibility in a pension system, with 38% seeking flexibility in the savings phase and 44% in the payout phase. Cost-effectiveness is also a priority, with the need to keep costs low while ensuring adequate coverage.
A significant number (31%) of the surveyed self-employed believe the optimal pension provision should offer higher returns by utilizing opportunities on the capital market. Simplicity is also important, with 42% of the respondents preferring a system that is easy to understand and offers security in investment.
The Future of Pension Provision for Self-Employed in Germany
The current federal government's plan for a mandatory pension provision for the self-employed is aimed at providing additional security in old age. Planned reforms include the possible extension of statutory social security participation to cover self-employed individuals and civil servants.
There is a growing recognition of the need to include self-employed individuals in broader social security frameworks, reflecting a desire for greater financial security and stability. As discussions and reforms aimed at enhancing social security coverage continue, the preferences of self-employed individuals will play a crucial role in shaping the future of pension provision in Germany.
[1] Source: Reform Priorities [4] Source: Current System
- In the face of concerns over old-age poverty, many self-employed individuals in Germany are seeking a more robust pension provision that offers both security and flexibility, as evidenced by a survey conducted by YouGov on behalf of insurance group Ergo Versicherungen.
- Flexibility in both the savings and payout phases, cost-effectiveness, and higher returns through capital market opportunities are preferred features in a pension system for self-employed individuals, according to the same survey, indicating a need for wealth-management solutions tailored to their unique financial needs.
