Overview

• Under current rules projected to 2065, workers with only 30 years of contributions must retire at age 71 to attain a 90% replacement rate
• Voluntary early retirees who leave the workforce two years before the ordinary age face pension cuts of up to 21%
• Spain’s employment rate for 16- to 29-year-olds has fallen to 43.2%, reducing chances to build long, contributory careers
• The intergenerational equity mechanism will lift contribution rates by 0.1 percentage points annually, reaching 1.29% in 2029 and eroding workers’ net pay without boosting benefits
• Experts warn that without stronger private saving habits and a broad political consensus on pension reforms many future retirees will face inadequate incomes