COVID-19 has impacted almost every aspect of people’s lives globally. Whilst the short-term financial implications of the pandemic are front of mind for many individuals, we were interested to see whether these worries changed long-term savings behaviour. In this year’s Global Retirement Reality Report (GR3), we investigate the impact that COVID-19 has had on personal finances and behaviour around retirement planning. In this overview, we share the results of our survey of Dutch pension savers.
Savers in the Netherlands appear to be less affected by the COVID-19 crisis than other countries we surveyed, with fewer people reporting financial impacts. This may be in part because of the country’s “intelligent lockdown” approach and the support that companies have received from the government,1 such as the compensation offered to companies experiencing a loss in turnover of more than 20%. Some savers have adjusted their short-term spending and saving behaviour; however, this hasn’t yet affected long-term views around retirement confidence, with any impacts from the crisis expected to be short-lived.
Whilst not a direct result of COVID-19, retirement confidence remains low, with almost half of Dutch survey members reporting that they were not optimistic about their retirement. A key reason for this low confidence was a lack of trust in the long-term sustainability of the pension system. This should improve once the country’s planned pension reforms are implemented and people can see that a more sustainable basis is being put in place.
We were pleased to see a good sense of awareness from members about the risks of overreacting to market events and “selling at the bottom,” with almost half of the sample believing now is a good time to invest for the long term. Members also showed an appreciation for lower volatility strategies. These findings provide useful insight into the kinds of funds members would like to see their savings invested in.
Key Finding #1: Dutch savers reported less financial impact from COVID-19 compared with other countries
We began by taking a pulse check on the current financial situations of individuals, compared with the period before the COVID-19 outbreak. We found that 54% of the Dutch sample had been impacted in some form, such as having reduced pay or reduced hours, a lower proportion than in some other countries.