Expat Banking and Finance


Global survey reveals expats finding it harder to save for retirement

by Ray Clancy on January 22, 2015

Expats are finding it harder than ever to be able to save for their retirement with the global economic downturn making putting money aside more difficult, a global survey has found.

More than two thirds of people of working age fear that they will run out of money during their retirement, according to the report commissioned by HSBC. It also found that 40% are saving less for their retirement since the downturn.

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More than two thirds of people of working age fear they will run out of money during retirement

The Future of Retirement: A Balancing Act is the latest in a series of HSBC reports providing insights into the issues associated with ageing populations and increasing life expectancy around the world.

Ipsos MORI carried out the survey of 16,000 people in 15 countries, including people who had already retired as well as those of working age. A significant proportion of those who had already retired, 36%, wished that they had started saving earlier, the survey found.

About two thirds of those who had not prepared adequately for a comfortable retirement realized that there was a shortfall only after they stopped working. More than a third of retirees said people should start planning by the age of 30, at the latest, to maintain their standard of living in retirement.

Almost two in five people of working age surveyed were not saving for retirement at all, even though they realized the importance of planning early. Many people had also cut their levels of retirement saving since the economic downturn.

More than 80% said that unexpected events had made it significantly harder for them to set money aside. For some, this was because they had lost their job or had seen their income fall. For others, it was because a life changing event such as an accident or illness had stopped them or their spouse from working.

One in 10 people of working age today thought that they would never be able to retire fully from paid employment.

“There is no quick fix solution but the key for people everywhere is to focus on finding the means to save a little for their future, now,” said Charlie Nunn, group head of Wealth Management at HSBC.

“We know that budgets are increasingly stretched but even the smallest amounts saved can help reduce the long term effect of these challenging times, and make the likelihood of a comfortable retirement all the more real,” he added.

The report suggests some practical steps that people can take to improve their financial wellbeing in retirement including starting to make retirement plans as early as you can as well as thinking about the kind of lifestyle you want when you retire and how much you will need to fund it.

It also points out that it is easy for retirement savings to suffer when times are hard. It recommends that with the worst of the global economic downturn now over, people should start thinking how to replenish any depleted funds in their retirement pot.

It adds that unforeseen life events can damage retirement savings. While no one can see into the future, it advises people to consider what could happen and how this will impact their financial planning.

 

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