How important retirement is for the people? - September 30, 2018
In the future, retirement will be very hard without self-care. Pension systems are changing around the world and retirement ages are also rising. No wonder there are countries, where more than 70% of investors mark safe retirement as their first investment goal.
Retirement systems are changing around the globe. In the meanwhile, masses started to plan their retirements with savings. But how important this subject is to the individuals? Raconteur just created an eye-opening, worldwide data set about just that!
Western countries prepare the most
As it turns out from Raconteur’s data, residents of Canada, Australia, United States and the UK prepare the most for retirement. More than 70% of them marked retirement as the most important goal for their investments. Other developed countries have similarly high numbers, only France is missing out. People of firmly state-run China on the other hand seem not to care about private savings at all.
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Thinking forward and saving for retirement depend on the culture, too. Some countries put more focus on self-care and have privately run pension systems, therefore its residents seem to prepare more. Other countries have state-run (or mixed) pension systems. The people of these countries often care less about planning their retirements.
Generation does matter
Another interesting thing is how investment goals change with age. More than 60% of baby boomers invest to retire comfortably. This high rate falls to 60% with gen Xers and dips even lower (to almost 40%) with millennials.
Early retirement is a different thing, though. The younger the people the more likely they are planning an early retirement. Only around 15% of baby boomers plan to retire early, while more than 20% of gen Xers and millennials wish to retire before reaching the proper age.
Retirement age is rising
This difference between generations is quite understandable. Retirement ages are rising everywhere around the world from Germany to Denmark, Australia and Russia. Why? Because life expectancy is constantly rising, and pensioners are already living 8-11 years more than in the 60s when classic pension systems were designed.
This means two things: First, we either live three times longer from the same savings as we did in the 60s, or a huge gap will appear in the pension systems. This has already happened: $70 trillion gap is already present and may reach $400 trillion by 2050.
That’s why countries around the world rise retirement ages. This way workers will make more contributions to pension systems and they’ll also have shorter (less costly) pensions. In some countries, like Russia that leads to tensions and protests. In other countries, like China, people seem not to care about it at all. But more and more people start to plan and realize the importance of self-care and save up for their retirements. Lot of them chose investment portfolios with the proper instruments for their goals.
Disclaimer: This analysis is for general information and is not a recommendation to sell or buy any instrument. Since every investment holds some risk, our main business policy is based on diversification to minimize threats and maximize profits. Innovative Securities’ Profit Max has a diversified portfolio, which contains liquid instruments. This way, our clients can maintain liquidity, while achieving their personal investment goals on the long term.