Are Europeans saving enough for retirement? Here is how much more they need to put aside

Mandatory pensions are projected to fall short of the OECD’s retirement income target in 22 of the 30 European countries it studied. In its Pensions Outlook 2026, the OECD estimates how much extra employees on average wages would need to save over a full career to retire on 70% of their gross pay. Lithuania has the biggest gap as a share of earnings, at 20.

7%, while Switzerland has the highest estimated monthly contribution, at more than €1,000 a month for men on average wages. The OECD calls this the contribution gap. It is the extra share of earnings employees would need to put into a voluntary pension plan, on top of their mandatory contributions, to reach the target.

How much income people need in retirement depends partly on what they expect to spend. “There is no universal retirement income objective. Instead of using target replacement rates, one could use consumption benchmarks, which are target expenditure levels to reach specific lifestyles in retirement,” Stéphanie Payet, a policy analyst at the OECD, told Euronews Business.

The OECD calculates the contribution gaps, which vary from 0. 4% in Turkey to 20. 7% in Lithuania among male employees with average earnings.

The rates are mostly the same for women. But in Poland and Hungary, the gap for women is 8. 6 and 2.

9 percentage points higher, respectively. The gap is in double digits in many countries: Ireland (19. 4%), Poland (17.

3%), Croatia (15. 7%), Slovenia (12. 5%), Latvia (12.

3%), Estonia (12. 2%), Switzerland (12. 1%), Germany (11.

1%), Belgium (10. 7%) and Iceland (10%). “Where gaps are large, this means that people are often under-saved, and so they won’t have enough to have a good standard of living in retirement,” Professor Iain Clacher of the University of Leeds told Euronews Business.

Among other major economies, the gap is 9. 1% in the UK and 6. 2% in France.

It is smaller in Bulgaria (4. 4%), Slovakia (3. 9%) and Sweden (2.

2%). Turkey has the smallest positive gap, at 0. 4%.

In Austria, Denmark, Greece, Italy, Luxembourg, the Netherlands, Portugal and Spain, mandatory pensions are expected to meet the OECD’s retirement income target for men on average wages. How much extra would workers need to save each month? Euronews Business applied the OECD’s contribution rates to average gross wages in 2025.