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Retirement Readiness

This international research examines individual’s expectations and preparations for retirement, across generations, genders, and three countries, Australia, United Kingdom, and United States. The report also proposes a number of recommendations to help individuals better prepare for retirement based on these results.

Download the reportWhat you will get from this report:

  • An understanding of what people expect their quality of life to be in retirement
  • An understanding of how prepared individuals believe they are for retirement versus their projected outcome
  • An analysis of what should be done to mitigate these risks

Insight:

The significant shift from defined benefit (DB) to defined contribution (DC) arrangements means that employers are increasingly transferring retirement risk to employees unknowingly. This transfer of responsibility coupled with an ageing population led three actuarial associations (the Actuaries Institute of Australia, the Institute and Faculty of Actuaries in the United Kingdom, and the American Academy of Actuaries) to conduct a joint survey to see how prepared citizens in each country are for retirement.

The three associations determined that longevity risk was a major issue in each of their countries and prepared a White Paper, The Challenge of Longevity Risk, to alert the public and policymakers to our concerns. The Retirement Readiness Report summarises the results of the joint survey that we subsequently commissioned to investigate adequacy, the first of the five principles we identified in our report as necessary to addressing longevity risk.

Scope:

By using this approach, we could see if and how different cultural and historical practices and policies produced different preparations for and perceptions of retirement. This enabled us to identify those policies and practices that result in better or worse retirement planning.

Results:

Although our survey found that respondents are best prepared with respect to saving and acquiring information, respondents are least prepared with respect to:

  • Knowing how much they will need when they retire
  • Knowing how long their money will last
  • Preparing for longevity risk and social care

Based on these results, we have identified a number of recommendations to help citizens better prepare for retirement and determine what constitutes as adequate for their plans.  These recommendations include:

  • More targeted financial education
  • More default options, including for both accumulation and decumulation
  • Improving State Pensions adequacy and sustainability

Related documents

Contact Details

For further information on any of our public affairs or policy work please contact us on:

policy@actuaries.org.uk

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  • Spaces available

    A panel discussion with investment representatives discussing the impact of investment on climate change and vice versa.

    This event is part of The Road to Glasgow: IFoA’s Sustainability Thought Leadership Series which will provide a platform for prominent contributors so that our members and others can understand the perspectives of a wide range of parties interested in the climate debate.

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    Climate change is one of the greatest risks facing our world today. Addressing it will require multi-faceted solutions. Through this panel session, we will explore the different levers that can be used to meet net-zero targets including climate science and data, government engagement, and mobilising green finance.

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    How governments and societies collectively respond to the climate crisis is increasingly being analysed through the lens of intergenerational fairness. Our expert panel will assess and explore the extent to which inter-generous fairness is being considered in climate policies, the lessons from those countries who are leading the way on fairness and justice in climate interventions, and more.

  • The Growth Mindset for Actuaries

    13 October 2021 - 8 December 2021

    Spaces available

    This practical course is aimed at actuaries at any stage of their career who want to develop their own growth mindset and apply it to their work setting and personal or professional lifelong learning. The content of the course builds on the lecture given by Dr Helen Wright on Growth Mindset as part of the President’s 2021 Lecture series, and will be delivered over a period of 2 months, from mid-October to early December.

  • Spaces available

    The climate crisis and the degradation of our planet will affect societies everywhere. How we address these threats will require solutions that transcend borders. As a global profession, the actuarial community is well-placed to consider and propose effective risk management solutions to help manage the climate crisis.