Sun Life Asia Survey Highlights Inflation Challenges for Retirees
Sun Life Asia Survey Highlights Inflation Challenges for Retirees |
[02-October-2024] |
As Asia's population ages, younger generations are retiring later to save more
HONG KONG, Oct. 3, 2024 /PRNewswire/ -- As Asia Pacific faces a significant demographic shift with nearly one in four over the age of 60 by 20501, new research by Sun Life Asia reveals challenges and opportunities for retirement planning across the region. The research, titled Retirement Reimagined: facing the future with confidence, surveyed over 3,500 respondents across mainland China, Hong Kong SAR, Indonesia, Malaysia, the Philippines, Singapore, and Vietnam, about their aspirations and planning practices as they prepare for old age. Majority are ill-equipped to deal with financial realities of retirement David Broom, Chief Client and Distribution Officer at Sun Life Asia said: "The retirement landscape in Asia is undergoing a profound transformation, driven by increased longevity and shifting societal norms. Our research shows that while independent financial security is seen as the foundation for a rewarding retirement, many people remain unprepared for the realities they face. Early planning and disciplined saving are key to facing your golden years with confidence." While most respondents save at least 10% of their income for retirement, an alarming 23% do not. When asked about planned sources of income in retirement, the average expectation was for 25% of income to be drawn from cash savings, underscoring a potential missed opportunity to maximise retirement income through investments and ensure it keeps pace with inflation. Retirees caught off guard by higher costs and regret insufficient preparation For those caught off guard by higher costs, the key factors are the general cost of living (76%) and healthcare expenses (51%). In response, many have been forced to cut spending (73%) and liquidate investments (29%). Approximately 23% of retirees express regret over past financial decisions with the biggest reasons being not saving enough (66%), followed by not investing enough (52%), and not planning for healthcare costs (34%). Younger generations are adjusting expectations: retiring later and saving more Similarly, 17% of non-retirees actively have postponed their retirement plans, compared to only 8% of retirees who did the same, reflecting changing economic conditions and personal circumstances. The primary reasons for delayed retirement include the need to save more (61%), the desire to remain active (49%), enjoyment of work (46%), and increased living expenses (43%). Those anticipating a later retirement age are more likely to cite increased living expenses (46%), compared to 19% among current retirees who delayed their exit from the workforce. Gold Star Planners look to their later years with optimism, while Retirement Rebels struggle Comparing the Gold Star group to the Retirement Rebels, who have no insurance and pension protection, nor sufficient planning and saving around their later years, reveals interesting insights. Retired Gold Star planners are more likely to stay within their expected expenses (73% vs. 31%) and less likely to regret post-retirement financial decisions (14% vs. 40%). The Gold Star group is far more likely to consult professional sources on retirement planning including financial institutions and independent advisers, and they are more confident about their health and financial wellbeing in their later years. Across all groups, the number one aspiration for retirement is spending quality time with family and friends (35%), followed by the prospect of escaping the daily grind of work and relaxing (22%), and global travel (18%). The greatest concerns associated with later years are health issues and physical decline (59%), factors that could put these dreams at risk. David Broom, Chief Client and Distribution Officer at Sun Life Asia said: "Ensuring the wellbeing of our growing senior population is a shared challenge in our communities. While health is the most important pillar, it is also inextricably tied to economic security, productive work, strong family and social connections in the community. We have a unique opportunity to redefine what a secure and healthy retirement looks like and that means empowering people to approach their post-career years confidently with proactive plan for their finances." About Sun Life Sun Life Financial Inc. trades on the Toronto (TSX), New York (NYSE) and Philippine (PSE) stock exchanges under the ticker symbol SLF. Media Relations Contact: Becky Marshall 1 Source: Asia Development Bank: https://www.adb.org/what-we-do/topics/social-development/aging-asia
| ||
Company Codes: Toronto:SLF, NYSE:SLF, Manila:SLF |