A growing proportion of Czech adults are saving for retirement, but experts warn that widespread financial habits risk undermining long-term security.

According to data reported by TN.cz and the Association of Pension Companies of the Czech Republic (APS), approximately 70 per cent of adults in the Czech Republic are now setting aside funds for retirement.

However, most began saving too late in life, contribute relatively low amounts, and often rely solely on traditional savings accounts, an approach that experts say is financially unsustainable in the long term.

Trinity Bank chief economist, Lukáš Kovanda, highlighted to TN.cz the risk of losing purchasing power in today’s inflationary environment. He noted that if an individual deposits CZK 100,000 in a savings account offering 3 per cent interest during a period of 5 per cent inflation, the real value of those savings would fall to approximately CZK 98,000 after one year.

Despite increased public awareness around the need to prepare for retirement, such conservative saving practices are proving ineffective at preserving wealth.

The most common monthly retirement contribution is around CZK 1,000, equivalent to roughly €40. This figure remains well below the level required to build an adequate pension pot. Economists suggest that Czechs should aim to accumulate at least CZK 2m, or approximately €80,000, over their working life in order to retire with a secure income.

One of the central concerns cited by economists is the public’s reluctance to invest. Compared to other European nations, the Czech population tends to favour conservative financial products and underutilise investment vehicles that offer the potential for higher long-term returns. This risk aversion may contribute to a significant shortfall in retirement readiness.

However, options for more effective pension accumulation are available, according to the APS. The Czech Republic’s supplementary pension savings scheme (DPS) offers dynamic funds that invest a substantial portion, or, in some cases, the majority, of assets in equities.

Over the past six years, pension companies have delivered average annual returns of nearly 10 per cent through these equity-focused funds, according to TN.cz.

Despite this strong performance, uptake remains limited due to low financial literacy and a lingering distrust of market-based investment.

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