The French spend longer than most in retirement

Time to wake up and smell the coffee, Ingist. Government pension schemes are all pay as you go, in Germany, France, UK, and America. The first recipients received money immediately, despite not paying into the system, because they were paid using the current workers' contributions. Because the workforce continued to grow during the 20th century, funding was relatively easy, although increasingly expensive as lifespans increased and retirement age remained constant (or decreased in places like France). Now the workforce is stagnant or shrinking in Europe and Japan.

The money you 'paid into' the system when you were working went to pay for your father's generation. It's gone. Your children's taxes will pay for you. But there aren't enough children, and your generation is living too long. That's the problem for every one of these pension systems. They were fine as long as the workforce grew and lifespans didn't. Whoops.

Personally, I think it would be more enriching to retire later and take a number of six-month to two-year breaks from work, rather than work until a set age and retire completely at a set point.

The article makes a mistake is listing "government" spending for retirement programs. No government spends $, euru, pound, or whatever on retirement (or anything else). It is the working children, grandchildren, great grandchildren, and, given the debt countries are piling on, perhaps even great great grandchildren and beyond who will pay for today's retirees.

At the risk of sounding insensitive, these retirement trends are unacceptable for any self-respecting society. Through the miracles of modern medicine, our lifestyles are changing(we are living longer and healthier), therefore our retirement policies must change (we must work more). People with an inappropriate sense of entitlement are trying to take advantage and get more for less. This strike sounds like the sniveling whines of a spoiled ingrate with a twisted sense of entitlement. (zing!!!)

It is evident from the chart that women (above all in Japan and Sweden) should retire on average 5 years later than men as women live more years.

That is something so evident that I don´t understand why the economic and political decission are not taken. In fact, in some countries like France the situation is so ridiculous that women retire years earlier thann men even if they live more years.

"Do these metrics take into account that the life expectancy differs between France and the US? If the life expectancy is 3 year higher in France than in the US, that explains 50% of the 6-year difference..."

They do. With a longer life span, you should be working proportionally longer.

What's the purpose : Living to work, or working to live ? It seems the Frenchies have decided...

As a 21 year old student. This makes me scared. The current generation has less kids, then rely on those who did have kids (kids like myself) to take care of them in this stupid pay as you go system.

Thanks retirees, hope you enjoy Florida, cause I'll be paying for it...

Canadians seems to get it right with the lowest % of GDP spent on pensions while its citizens are no worse off comparing to other countries in the chart.

Well done Canada!

Incredible that in France there are millions of women, and also many men, who spend 30 YEARS! of their life in Retirement. A lot of human capital is lost. 30 YEARS retired...

Do these metrics take into account that the life expectancy differs between France and the US? If the life expectancy is 3 year higher in France than in the US, that explains 50% of the 6-year difference...

Sorry, this chart is rubbish.
It uses incomparable systems and figures.
In Germany, for example, every single pensioner has to earn (work for) its pension before he gets a single euro later in life.

Imagine it like a great savings account where the government takes the part of the bank - working generation pays in (19.8% of monthly income) and receives imaginary points. These points are translated in euro at retirement.

In fact, all the money pensioners "receive" from the state has already been earned! Only because Anglo-Saxons rather use company-pension schemes more often or private insurance schemes does not make one or another system superior.

In fact I believe, the European model has some advantages, when you consider the recent financial crises where billions of $ evaporated.

Maybe the governments should go with a different take?
Couples with children can retire sooner since they have someone down the line to pay for that retirement. The rest should work longer.

p.s. when social security was invented in the 1930's to get through the great depression, the life expectancy was 64.

Work in USA or other places with low tax rates,
Retire in France or other places with huge welfare spending

seems like a good plan to me

What also must be remembered when looking at this chart, is that it isn't just that the French government must come up with 5 years more in retirement income for its citizens than (for example) the Canadian government, but that its citizens work at least 5 years LESS than Canadians in order to pay taxes to fund that government - i.e. by retiring at 60 or even younger in France versus 65 or sometimes even later in Canada. This makes the economic situation in France far worse than would be understood by looking at this chart alone.

France must reform. The sooner its citizens realize and accept that the current situation is financially not sustainable, the better off they will be in the long run.

Just to wrap it up:

Because Europeans and Japanese save / pay more while working - they receive more money when retired.

And don't forget, in most of these countries people are not mad about property and must pay a monthly rent...

ingist wrote "Even if there are (in remote future) only 2 workers for one pensioner, the system won't fall apart. Simply pensioners will get less pension."

That's funny. As the protests in France show, once people are used to a benefit, they are reluctant to let it go. So are you seriously arguing that pensioners in France Italy, Japan and Germany are going to accept 30%+ cuts in their pension? That will be what it takes if reforms are not put in place now.

Also I'd observe that German social insurance is no smarter than most public schemes in that it has failed to raise the retirement age as people have started to live much longer.

A fixed retirement age of 60 to 65 is no longer justifiable. There is no reason why people cannot be productive and employed into their 70's. I say burn the fixed retirement age and replace it with a sliding scale of pension benefits (the later you retire you higher your pension).

I'd still let people retire at 60 if they want, but on a tiny pension as a penalty for being such slackers.

@ Ohio:

at least for Germany it is a bit different.
Social Insurance was already introduced in the 1880's by Bismarck!
This include:
1883 Health insurance
1884 accident insurance
1889 insurance pension

The system suvived the Kaiser, 2 World wars, hyperinflation in the 1920's, the Weimar Republic, the 3rd Reich, a socialist and a capitalist Germany and eventually a reunited Germany.

And you tell me demography will break it?

Of course the current workers pay the pension of the retired. But all they earn are "virtual" Pension points. The government can revalue these points at any time - and does it frequently.

Even if there are (in remote future) only 2 workers for one pensioner, the system won't fall apart. Simply pensioners will get less pension.

IMO what is going to have to happen in the near future is that companies are going to have to come up with "senior plans" for older workers. Something like: 70% of the pay, but with 2-3 months of paid vacation and generous sick time. There could be lots of variations on this, maybe 6 hour workdays, whatever, but something to allow older workers to remain productive if they want to without the full-time stress.