The following was published on the gulfnews.com site in March, 2014. The story was written by Huge Duncan
19% of savers will have to rely on children for cash after they stop work, a global survey says
It blames high taxes and paltry returns on savings, which have plunged since interest rates were cut to an all-time low of 0.5 per cent five years ago
On the retirement finances measure alone, the UK was rated 77th — one of the lowest rankings of any Western nation, and behind developing countries including Botswana, Cameroon, Colombia and Guatemala.
Nearly one in five workers expects to turn to their children to help make ends meet during their retirement, according to figures published today.
The Global Retirement Index shows that 19 per cent of savers will have to rely on their offspring for cash when they stop work if their pension incomes fall short. Another 4 per cent will turn to their grandchildren.
The report, by international investment giant Natixis Global Asset Management, highlights the crisis facing millions of workers struggling to save enough for their pensions.
It blames high taxes and paltry returns on savings, which have plunged since interest rates were cut to an all-time low of 0.5 per cent five years ago.
Campaigners warn that those worst hit include women and low earners. The research also explodes the ‘myth’ that all pensioners are wealthy.
Experts say there has been “a generational change in terms of who is providing financial assistance within UK households”, with many children now propping up their parents in old age.
“It is more important than ever for UK savers to do more to take individual responsibility for their own financial security and view saving for retirement as an essential part of everyday life,” says Chris Jackson, head of UK retail at Natixis.
Overall, the Global Retirement Index (PDF FILE) ranks Britain 18th out of 150 countries in terms of how its citizens fare in retirement. (Other countries such as Switzerland, Norway, Austria, Sweden, Denmark, Germany, Finland and Luxembourg are in the top ten. Other highlights from the report are:
On the retirement finances measure alone, the UK was rated 77th — one of the lowest rankings of any Western nation, and behind developing countries including Botswana, Cameroon, Colombia and Guatemala.
The UK’s final ranking was raised by high scores on health and environmental factors.
In the event of retirement funds falling short, nearly half of savers (40 per cent) planned to rely on benefits.
Pensions campaigner Dr Ros Altmann, a former Downing Street adviser, said the latest figures discredited the idea that all pensioners are wealthy.
“A minority have done well from private pensions, but the majority of those yet to reach retirement do not have enough saved up to provide a generous retirement income and our state pension is one of the lowest in the developed world,” she said.
“Many older people do not own their own home and some still have debts to repay, so the fact that they will need financial support from their children is hardly a surprise.”
Tom McPhail, head of pensions research at wealth manager Hargreaves Lansdown, said those in their 40s and 50s today will be worst hit.
“They’re too young to get a decent final salary pension and too old now to build up a decent retirement fund of their own,” he said. “Inevitably, whether they want to or not, many of them are going to end up looking to their children for financial support. It is also inevitable that many millions are going to end up working on late into their 60s or even their 70s just to make ends meet.”
19% of savers will have to rely on children for cash after they stop work, a global survey says
It blames high taxes and paltry returns on savings, which have plunged since interest rates were cut to an all-time low of 0.5 per cent five years ago
On the retirement finances measure alone, the UK was rated 77th — one of the lowest rankings of any Western nation, and behind developing countries including Botswana, Cameroon, Colombia and Guatemala.
Nearly one in five workers expects to turn to their children to help make ends meet during their retirement, according to figures published today.
The Global Retirement Index shows that 19 per cent of savers will have to rely on their offspring for cash when they stop work if their pension incomes fall short. Another 4 per cent will turn to their grandchildren.
The report, by international investment giant Natixis Global Asset Management, highlights the crisis facing millions of workers struggling to save enough for their pensions.
It blames high taxes and paltry returns on savings, which have plunged since interest rates were cut to an all-time low of 0.5 per cent five years ago.
Campaigners warn that those worst hit include women and low earners. The research also explodes the ‘myth’ that all pensioners are wealthy.
Experts say there has been “a generational change in terms of who is providing financial assistance within UK households”, with many children now propping up their parents in old age.
“It is more important than ever for UK savers to do more to take individual responsibility for their own financial security and view saving for retirement as an essential part of everyday life,” says Chris Jackson, head of UK retail at Natixis.
Overall, the Global Retirement Index (PDF FILE) ranks Britain 18th out of 150 countries in terms of how its citizens fare in retirement. (Other countries such as Switzerland, Norway, Austria, Sweden, Denmark, Germany, Finland and Luxembourg are in the top ten. Other highlights from the report are:
- Core” European nations outdo “peripheral” countries that were forced to cut more severely into their social programs.
- Canada is in 14th position--nothing for our leaders to brag about this year.
- Switzerland rose to No. 1 in the world on the retiree financial security scorecard, displacing last year’s top country, Norway.
- For the second straight year, the United States ranks 19th of 150 nations. This trails countries such as the United Kingdom, Korea and the Czech Republic.
- Here are the top 30 countries in ranking order
The rankings are based on analysis of 20 key trends across four broad categories: health and health care quality; personal income and finances; quality of life; and socioeconomic factors.
On the retirement finances measure alone, the UK was rated 77th — one of the lowest rankings of any Western nation, and behind developing countries including Botswana, Cameroon, Colombia and Guatemala.
The UK’s final ranking was raised by high scores on health and environmental factors.
In the event of retirement funds falling short, nearly half of savers (40 per cent) planned to rely on benefits.
Pensions campaigner Dr Ros Altmann, a former Downing Street adviser, said the latest figures discredited the idea that all pensioners are wealthy.
“A minority have done well from private pensions, but the majority of those yet to reach retirement do not have enough saved up to provide a generous retirement income and our state pension is one of the lowest in the developed world,” she said.
“Many older people do not own their own home and some still have debts to repay, so the fact that they will need financial support from their children is hardly a surprise.”
Tom McPhail, head of pensions research at wealth manager Hargreaves Lansdown, said those in their 40s and 50s today will be worst hit.
“They’re too young to get a decent final salary pension and too old now to build up a decent retirement fund of their own,” he said. “Inevitably, whether they want to or not, many of them are going to end up looking to their children for financial support. It is also inevitable that many millions are going to end up working on late into their 60s or even their 70s just to make ends meet.”
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