While people’s understanding of their retirement finance options varies across age and region, it remains lower than is ideal. This is particularly true of those approaching retirement age, whose understanding is better than that of younger generations but still worryingly limited. The varied economic context and legislation across regions means understanding varies geographically, and is lowest in Australia and the UK.
2) Concerns about living costs are shared across regions
Being able to afford day-to-day living costs is a key concern among all the regions surveyed. This is likely to reflect the current economic crisis, including inflation and rising living costs. It also reflects the fact that some retirement finance options are insufficient to reassure an ageing global population that they will have enough saved to continue their current levels of spending and quality of lifestyle into old age.
3) The gender gap persists
Reflecting continued gender inequality around the world, we found that women tend to be more concerned about living costs and healthcare costs than men across all the regions surveyed. The results also show that women’s understanding of their retirement finance options is slightly lower than men’s, and that women are more likely than their male counterparts to view retirement as a transition as opposed to a one-off event.
These differences reflect the significant gender pension gap that exists globally, and leaves women worse off in retirement. Auto enrolment into retirement savings schemes goes some way towards safeguarding savings for later in life, but there is more to be done to level the pension landscape in regards to gender and other demographics. Australia is leading the way here, with the most advanced defined contribution (DC) system of all those surveyed. Their example could guide other regions as they look to move to an auto enrolment setup.
4) Many savers’ needs aren’t being met
As we saw in 2021, there is a gap between what savers want from a pension provider, and what is being provided. This is particularly true of digital access, with many expressing an appetite for managing their retirement finances online, when the reality is that most will still receive paper statements. While other areas of life – like banking and shopping – are dealt with at the touch of a button, pension services lag behind. We can expect to see savers demand more of their pension providers in this space in the years to come.
As well as online access, all regions surveyed expressed an increasing desire for transparency and flexibility from their pension provider. Having a wide range of investment options is most important to Australians out of all the regions, perhaps representing their more advanced system.
We hope that highlighting the emerging needs, concerns and trends around retirement finance will help to shape the retirement landscape for the better. This is just one example of the types of research we do to inform our development of technology solutions that make pensions simpler and more accessible for all.