Almost a third (29 per cent) of working-age Estonians cannot afford to save for retirement, a Norsta survey commissioned by Luminor found.
 
The research found that financial coping was the biggest obstacle among people aged 40–49, as 37 per cent of Estonians in this age group said they do not have the means to save for a pension.

In addition, under 30 per cent of younger people reported the same, compared to 32 per cent of those aged 50-65.

Luminor noted that despite these challenges, the total volume of Estonian voluntary pension funds grew “strongly” last year, with the number of people joining the third pillar increasing by 17,200 in 2024, reaching a total of 220,000.

However, the majority of working-age people still do not save money in the third pillar.

Luminor fund manager, Vahur Madisson, expressed concern about this trend and said: “It is somewhat worrying that such a large proportion of people in their prime working life cannot afford to save money, even though this is the best time to secure their old age.

“If a 40-year-old earning the average Estonian salary today puts aside nearly 6 per cent of his salary, or €100 per month, then, taking into account the long-term average annual return, his investment in the third pillar will reach more than €70,000 in 25 years.”

Madisson acknowledged that the “rapid” price increases in recent years, combined with the past and upcoming tax increases, make saving money for the future difficult for many.

“On the other hand, it is positive that people’s interest in saving for retirement has grown in recent years, both in terms of increasing second pillar payments and in terms of people saving for the third pillar,” he continued.

 The research also revealed 33 per cent of people said they do not save as they do not see the third pillar as a safe and profitable investment, with the most sceptical being those aged 40-49 (43 per cent).

Madisson argued that there was no basis for the fear of the third pillar as an unsafe investment, suggesting that 2024 was a “landmark year” in this regard.

He said that the total volume of Estonian third pillar funds grew by 45 per cent to €890m due to “globally favourable winds” in the world’s financial markets.

He suggested reviewing and optimising everyday spending can help savers create a saving habit.

“Retirement is worth thinking about for everyone, regardless of age. The main thing is to create a habit and think about the future,” he said.

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