Romanians expect double pensions compared to what the Romanian state can offer, and most do not save and say they have no money saved for retirement, according to a city-level public opinion poll by the sociological research institute ISRA Center at the request of the Association of Private Pensions in Romania (APAPR).

When asked “what do you think a decent pension is worth”, the average value of the responses was 3,650 lei, more than double the level of 1,736 lei, which is the average contributory public pension (source: National Public Pension House, October 2022 ).

Currently, only about 7% of pensioners in the state system receive a monthly pension above 3,650 lei (estimate based on open CNPP data).

83% of Romanians say that they do not save anything for retirement. 55% of Romanians fear that the state will not be able to provide them with a decent pension, while only 37% believe that the Romanian state will have no problem paying your pensions.

• “For some time it has become clear that there is a significant gap between the legitimate expectations of today’s active population and the limited financial capabilities of the public pension system – and this is a problem not only for Romania, but for the whole world.
• Fortunately, Level II private pensions work precisely to cover this lack of financial protection, without any additional effort to save, directly from the gross salary, and the money is constantly accumulated in personal accounts, where it is invested, generates income and supports development like Romania’s economy,” he claims Radu Krachun, President of APAPR.

Also, 55% of respondents say that it is not clear to them what kind of pension they will receive from the state, as the level of the pension depends on the political factor, the sociological study shows.

• “Financial stability has become an important issue for Romanians in recent years, but for most, this stability only means meeting daily expenses, while savings remain a luxury they cannot afford.” – says Alina Dinka, executive director of the ISRA center, who coordinated the sociological research.

Other relevant results for Tier II (and comparison with a similar survey conducted in 2019):

• 90% of Romanians have heard of Level II private pensions (compared to 85% in 2019)
• 75% know that money accumulated in Tier II is the private property of those who contribute to the system (compared to 73% in 2019)
• 66% know they are participating and contributing to Tier II (compared to 55% in 2019)
• 55% know that Pillar II funds are guaranteed by law and cannot be lost (down from 63% in 2019)
• 23% know how much money they have accumulated in their personal account from Pillar II and indicated an average amount of more than 17,400 lei (17% in 2019, when the indicated amount was slightly more than 8,300 lei)
• Only 10% know that the contribution percentage associated with Tier II is 3.75% of gross income (compared to 4% who knew in 2019).

A third of the urban population of Romania declares a difficult financial situation

30% of respondents say it’s “difficult, but we manage to meet basic needs” (compared to 20% in 2019), while the percentage who say “we’re in a good financial situation” drops to 27% in 2022 compared to 35% in 2019.

The current economic context has strongly influenced Romanians’ perception of everyday problems.

When asked what is currently the biggest problem in Romania, 29% answered high inflation, 10% – low incomes, only 4% – corruption – a completely different situation compared to a similar survey conducted in 2019, when 6% pointed to inflation, 18% low income and 18% corruption.

• “The current context, created by the consequences of the pandemic, inflation, geopolitical instability and exacerbated by alarming news, is reflected in people’s perception of savings and implicitly in the second tier of private pensions.
• Thus, the study showed that 2 out of 3 Romanians believe at least one of the false information that has been spread over time about Level II, such as that they can lose all the money deposited or that there will be no guarantee or strict regulation of the accumulated amounts. – says Alina Dinka, executive director of ISRA Center.

How the survey was conducted

The survey is nationwide for urban environments, ages 20-55, middle income and above. The survey was conducted at the end of September 2022 on a sample of 1,103 respondents by personal survey on a tablet (CAPI method), margin of error 2.9%.

The quantitative study was preceded by a qualitative research phase, which included the organization of three focus groups with mixed participation from Bucharest and other large and medium-sized cities to update and improve the questionnaire used in the previous study (2019, also conducted by the ISRA Center commissioned by APAPR).

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