Retirement Causes Increase in Poverty Level for Thousands of People in Switzerland
Living in Poverty as a Senior: Struggles of Older Population in Switzerland
With Switzerland being named as one of the wealthiest countries in the world, the prosperity of its elderly population has turned into a major concern in the nation. Recent research has found that in the retired Swiss population the wealth gap is very large. According to the Federal Statistical Office (OFE), nearly 9% of people over the age of 65 say they have great difficulties making ends meet, and one in five older people are living below or close to the poverty line. Nearly 50,000 seniors have no savings to make up for their low income.
A recent study commissioned by Pro Senectute, an organization committed to the dignity of the elderly and that offers social advice External link and helps older people with economic problems, calculates that more than 200,000 retired people live on an income below the poverty line and another 100,000 are on the borderline. Women, people with a low level of education and those who have come from abroad are at greater risk than the rest of the population.
The household income for elderly is made up of old-age and survivors’ pension (AVS) and professional pension. However, with the rising costs of health care and most basic products, the situation is increasingly becoming dire for the seniors living on a fixed income.
Recently, parliament agreed on a 2.5% increase in AVS pensions for 2023 to compensate for inflation, which will be a relief for low-income retirees. However, the National Council rejected in December a popular initiative launched by the Swiss Trade Union, which called for the payment of a thirteenth monthly AVS pension for retired.
While it is true that generally, retired people have achieved savings and assets during their working lives, most do not have the means to ease their sudden poverty upon retirement. Parliamentarians have started to debate the details of the future reform of occupational pensions as a potential solution to this ongoing issue.