Dutch expect pension benefits to be reduced as a result of Covid-19 – DNB

Two-thirds of Dutch households expect their pension benefits to be reduced as a result of the coronavirus crisis, according to a survey by DNB.

Its survey of Dutch households found that 51 per cent expect them to be somewhat lower, whilst 14 per cent think they will be substantially lower than the current payments. Only one in five expects pension benefits to be in line with current commitments.

A previous survey among the same target group showed that people respond differently to cuts in pension benefits.

The largest group (29 per cent) said they would wait and see if their pension benefits should be reduced. Just over a quarter (27 per cent) said they would save up more, whereas just under a quarter (23 per cent) believed they had enough financial leeway to absorb a reduction. The remaining respondents said they would respond differently or did not know how they would respond.

Despite this, two-thirds of Dutch households remain confident that their pension funds will be able to pay out their pension benefits. The national bank found that overall trust in financial institutions remains high among Dutch households, compared to previous year.

Three-quarters of the respondents say they mostly or fully trust their own banks, a figure that shows no sign of waning compared with a year earlier. Trust in insurance firms and pension funds also remained at the level seen in 2019.

In spite of concerns over the harmful impact of the coronavirus crisis, Dutch households maintain confidence in their own financial institutions.

The unflagging public trust in banks, insurance firms and pension funds was recorded against the backdrop of strengthened trust in institutions overall and notable growth in trust in politicians compared with a year earlier.

However, households in the Netherlands are worried about the impact of the coronavirus outbreak on the economy, their own financial situation and that of financial institutions. Remarkably, on a 0-10 scale, they rate their concerns over the economy at 7.9, higher than those over their own finances, which they rate at 5.8.

In addition, Dutch households also expect the coronavirus outbreak to have repercussions on the financial position of banks, insurance firms and pension funds, but this worries them less than the impact of the virus on the Dutch economy overall.

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