More People Are Uncertain About Funding Retirement, Says Survey
According to the Natixis Global Retirement Index 2024, a high number of people globally are unsure about their finances and feel they have to fend for themselves financially in old age.
According to the Natixis Global Retirement Index 2024, a high number of people globally are unsure about their finances and feel they have to fend for themselves financially in old age.
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Eighty-one per cent of people surveyed in 44 countries believe funding for retirement is their responsibility rather than relying on others like public or private pension funds, according to the Global Retirement Index (GRI) 2024. The percentage of people with such views has increased from 67 per cent in 2015 to 81 per cent in 2023, the report released this month said.
Countries from the Organization for Economic Cooperation and Development (OECD), BRIC (Brazil, Russia, India, and China), and advanced economies were included in the study to understand the factors that provide retirement security or the best practices of retirement policy conducted by Natixis Investment Managers and CoreData Research, a data research firm.
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People, the study said, feel more anxious due to the shift from defined benefit pension to defined contribution and the increasing public debt to meet short-term funds for the pandemic, inflationary pressure, and market volatility. The report considered 18 indicators under four themes: health, finance, quality of life, and material well-being to understand retirement security.
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Health: It includes life expectancy, per capita health expenditure, and non-insured health costs.
Finance: Factors that affect a person's retirement security are old-age dependency, non-performing loans, inflation, interest rates, taxes, government debt, and governance.
Life Quality: Happiness, environmental factors, such as air quality, water and sanitation, bio-diversity, and habitat were considered for life quality.
Material Well-Being: This bucket indicates material well-being and includes factors like income inequality, income per capita, and unemployment.
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The report highlights four key risks to global retirement security, which includes:
Interest Rates: While the low rates have been a concern worldwide since 2012, the recent high rates means the money kept in cash is sacrificing on interest.
Inflation: Eighty-three per cent of investors say “recent events reminded them of just how big a threat inflation poses to their retirement security”.
Public Debt: The public debt in the OECD countries has more than doubled in the first quarter of the 21st century, as they sign up for long-term debts to navigate financial crises.
Investors’ Understanding: The fourth risk is people’s ignorance about retirement planning. The risk of unrealistic expectations is huge and investors “do not have a consistent vision”.
Among the four thematic indices, India is in top 25 only in the ‘Finance’ indicators as it jumped from 42nd spot in 2014 to 24th in 2023, and to 21st in 2024. The report notes that the retirement saving gap is increasing across the world. For India, the gap was $3 trillion in 2015 and is projected to rise to $85 trillion by 2050. In the overall ranking, India stood at 44th position.
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RBI plans to enhance the CBDS’s programmability and offline functionality to ensure financial inclusion of people in rural and remote parts of the country.
Around 90,000 cases, on average, are registered on the Centralised Pension Grievance and Redress System (CPENGRAMS) web portal annually, according to government data
The government will evaluate the officer’s work, efficiency, abilities, and behavioural aspects, and based on that information, it will make a final decision.
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