Retirement: Private-sector employees will lose nearly half their income
The average replacement rate—that is, the percentage of one’s final salary retained upon retirement—stands at 75% for non-executive employees and 51.5% for executives in the private sector. Yet more than two out of three working people are unaware of the amount of their future pension.
The most troubling figure emerging from this latest round of discussions on retirement does not concern pension levels, but rather a lack of awareness. According to the eighth wave of the IFOP survey on savings in France and its regions, published in June 2026, more than two out of three working French people do not know how much their pension will be. They anticipate a decline in their standard of living without being able to quantify it, which is like drawing up a budget without knowing the revenue.
The disparity between the two categories, as outlined in the June 2026 annual report of the Pension Policy Council (COR), is worth noting. A non-executive employee retains three-quarters of their income. A private-sector executive retains barely more than half, because the portion of their compensation exceeding the Social Security ceiling generates pension rights only under supplemental pension plans. The higher the salary, the steeper the drop, and the sooner the need for supplemental income begins.
“A substantial drop in income that needs to be offset as soon as possible,” summarizes Pascale Gloser, president of CNCEF Patrimoine, a professional association of wealth management advisors. But first, we need to know where we’re starting from.
The Individual Statement of Status: The Primary Source of Errors
The document exists, but no one reads it. The Individual Statement of Status (RIS) is mailed every five years starting at age 35, and can be retrieved online from the Pension Insurance website if it has been misplaced. It lists the periods of employment that have been credited, and thus the quarters accrued.
It also often contains errors: missed quarters of employment, incorrect salary amounts, incorrectly calculated periods of unemployment or long-term illness, unrecorded work abroad, or additional quarters for children that were omitted from the calculation. Corrections are still possible, provided you can provide proof of contributions for the periods in question—in other words, pay stubs. That’s why it’s important to check this at age 45 rather than 62, when employers may no longer exist and their records may have been lost.
The process becomes more complicated for those with multiple employment statuses—first as an employee, then as a civil servant, and finally as a self-employed professional—due to the variety of pension funds and plans. Pascale Gloser therefore recommends seeking guidance throughout the process until retirement benefits are finalized. For a quick estimate, the public simulator “Estimate My Retirement Benefits” provides the number of quarters of coverage and the estimated benefit amount for various retirement ages.
Four categories, in a specific order
The prerequisite isn’t financial—it’s related to real estate: owning your primary residence so you no longer have to pay rent once you retire. The rest comes down to diversification.
Rental real estate remains an attractive investment even without tax benefits, as you can use a property deficit to finance renovations. CNCEF Patrimoine’s advice is to focus on local properties: it’s best to buy close to home—a property you can visit in person to assess its location and rental potential.
Life insurance comes next—and preferably before age 70—since, under the 2026 legislation, proceeds paid out before that age are transferred up to 152,500 euros per beneficiary without inheritance tax. In addition, there are employee savings plans for those who have a corporate savings plan (PEE) or a collective corporate retirement savings plan (PERECO): funds are locked in for five years, with exceptions for early withdrawal—such as the purchase of a primary residence—and are exempt from income tax and social security contributions, excluding the General Social Contribution (CSG) and the Social Debt Repayment Contribution (CRDS). The employer may match the contribution up to three times the employee’s contribution, making this the best return on the market even before the first euro is invested.
Then there is the individual retirement savings plan (PER), in which target-date funds take on risk as long as the maturity date is far off and then gradually shift toward safer investments. Contributions are deductible from total income up to 10 percent of the previous year’s earned income, with a cap set at 37,680 euros for 2026.
As retirement approaches, two decisions need to be made. The first is to purchase additional quarters, which is deductible from taxable income but only applies if you are five years or less away from retirement and are only a few quarters short. The second is to plan PER withdrawals for a year with low tax rates, since the plan offers a tax benefit upon contribution and taxes both the principal and interest upon withdrawal.
Three precautions bring up the rear: keep some savings available for a rainy day; liquidate part of your employer-sponsored savings plan after retirement if it’s substantial, to stop paying management fees; and plan ahead for the transfer of your investments by checking their tax treatment.
The first step costs nothing and takes just one evening: open your statement.
