Nearly three quarters (74 per cent) of Danish people have little or no knowledge about so-called ‘retirement savings’, according to a study carried about by Epinion for Sampension.

Retirement savings were introduced as a replacement for the capital pension 10 years ago.

Sampension stated that although it is an attractive type of pension saving, most Danes have little or no knowledge of retirement savings.

Just one in five (20 per cent) Danes said that they knew retirement savings ‘reasonably well’ or ‘really well'.

Knowledge of retirement savings was lowest among young people aged between 18 and 35.

However, even those approaching retirement aged between 57 and 65 had little knowledge of the pension saving option, with 36 per cent saying they knew retirement savings reasonably well or really well.

"This year marks 10 years since retirement savings were introduced as a replacement for the capital pension,” commented Sampension head of market and customer advice, Anne-Louise Lindkvist.

“But even though it is an attractive form of savings, retirement savings have not yet gained widespread use in this country. And it can, among other things, connected with the fact that many Danes do not have sufficient knowledge of the options, which of course applies across age groups."

Lindkvist pointed out that there were several advantages to retirement savings.

Returns on contributions to retirement savings is taxed at 15.3 per cent during the accumulation state, which is lower compared to other saving options, such as free funds that are taxed at between 27 per cent and 42 per cent.

"Far more pension savers here at home could benefit from paying into retirement savings, and this applies not least to Danes, who do not pay top tax,” Lindkvist continued.

“In this connection, there is also good reason to highlight that from this year new rules apply, which make it even more advantageous to pay into retirement savings."

The new rules mean that from 1 January 2023 you can pay DKK 8,500 per year into retirement savings, compared to the previous DKK 5,500 per year.

At the same time, the rules mean that Danes who are seven years or less from the state pension age can, from this year, pay DKK 56,900 into retirement savings.

With the previous rules, Danes with five years or less until the state pension age could pay DKK 54,200 into a retirement savings.

According to the survey, less than a quarter (23 per cent) of Danes had heard of the new improved payment options.

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