Joachim Nagel, President of the Bundesbank, states that a comprehensive pension reform is necessary, arguing that raising the statutory retirement age and linking it to longer working lives is inevitable.
Speaking to the “Handelsblatt”, Nagel addressed the need for systemic changes, advocating that the standard retirement age must be systematically tied to increasing life expectancy after 2031. He described it as “logical” that people work during a portion of their extended lifespan.
In related discussions concerning the future of savings, Nagel welcomed the newly introduced retirement savings deposit. This new system, which begins in 2027 and replaces the Riester scheme, allows for investments in market-traded index funds (ETFs). While stating that this effort constitutes a positive signal and a crucial move toward a more capital-backed pillar of retirement savings, he cautioned that the reform’s effects will only materialize in the medium term. Furthermore, he noted that the deposit program will not solve the existing challenges facing the statutory pension insurance, nor can the current pressure be absorbed by continuous increases in federal subsidies.