Successful Retirement – Healthy Aging and Financial Security Hong Kong 21 st September, 2017 Mike Mansfield Helping people achieve a lifetime of financial security
Aegon Center for Longevity and Retirement
No.1 retirement dream globally: Travel
Financial Security: Three important tips 1. Start early 2. Become a habitual saver Those who start saving for Non savers their pension at age 20 compared to age 30 can have a boost of up to 64% in their retirement savings Aspiring Habitual savers savers 3. Write down your retirement plan Past savers 14 % I have a written plan I have a plan, but it is not written down 44 % 38 % I do not have a plan Occasional 4 % Don’t know savers
82% of people say that health in older age is a Healthy Aging: concern. Yet few are doing as much as they can.
Future retirement means “flexibility” I will immediately stop I will change the way I work (e.g. working part-time or on temporary contracts) but working altogether and only for a while before I eventually give up enter full retirement 33 % 31 % paid work altogether I will keep working as I currently do. I will change the way I work (e.g. working part-time Retirement age won’t make a or on temporary contracts) and I will continue paid difference to the way I work work throughout retirement in some capacity 16 % 10 % Other I don’t know 1 % 9 %
39 % of retirees globally retired sooner than planned Reasons for doing so
Japan: An aging society’s perspectives on health and retirement
Japanese preparedness for retirement - FINANCE For six consecutive years, Japan has achieved the lowest score in the ARRI ranking. Aegon Retirement Readiness Index Global Average: 5.9 Source: Successful Retirement- Healthy Aging and Financial Security The Aegon Retirement Readiness Survey 2017
Japanese preparedness for retirement - HEALTH More bad news for the Japanese. Japan ranks lowest in terms of self-reported health My health is good/excellent Global Average 68% Source: Successful Retirement- Healthy Aging and Financial Security The Aegon Retirement Readiness Survey 2017
Health-related behaviors I avoid harmful I exercise behaviors 50 % 57 % 38 % 41 % regularly (e.g. drinking too much alcohol or smoking) I take my health I eat healthily 57 % 42 % 45 % 31 % (e.g. five-a-day seriously portions of fruit and (e.g. have routine medical check- vegetables) ups and do regular self-checks) I practice I think about my long- mindfulness term health when making 17 % 5 % regularly lifestyle choices 43 % 26 % (e.g. meditation and (For example, I try to avoid stress) relaxation exercises) Source: Successful Retirement- Healthy Aging and Financial Security Global Japan The Aegon Retirement Readiness Survey 2017
Aren’t people in Japan healthy? As a matter of fact, the Japanese are healthy. Life expectancy and healthy life expectancy longer in Japan than other countries Global life expectancy Global healthy life expectancy Life expectancy Healthy life expectancy Source: WHO 2015 BMI: Japanese are in better shape % of overweight (BMI>25) % of obesity (BMI>30) BMI average (kg/m^2) Source: WHO Japan 24 % 3 % 22.6 2014, average of male and female adults 54 % 21 % 25.9 Global average (15 countries)
Why are people in Japan negative about their health and retirement prospects? Cultural aspects - Being modest and low self esteem Reference - most people are healthy Knowing too much about the health condition? Mandatory to take annual medical check.
Example of Ningen Dock Report, complete medical examination
Financial preparedness ARRI: Good awareness, but low understanding and even lower engagement in saving behavior. In fact, Japan has one of the lowest household savings ratios: 0.7% in 2015 (OECD) Global Japan
Healthier people feel more ready for retirement In Japan, those who say they are in excellent or good health achieve a higher Aegon Retirement Readiness Index score Q- How would you describe your health overall? Base: All not fully retired (N=900)
Let’s see what it feels like to be an older person
Some elements of the Old Age Suit Simulation of unsteady gait
Some more elements Simulation of various eye diseases Macular degeneration Unilateral retinal detachment Diabetic retinopathy Cataract Glaucoma Retinitis pigmentosa
Strategists can be a source of inspiration in preparing for retirement Those with a written Those without a Those with an unwritten retirement strategy retirement strategy at all retirement strategy 88 Very/somewhat aware of the 76 53 need to plan financially for retirement (%) 74 48 Habitual savers (%) 19 Strongly/somewhat agree that they have a very good idea of 78 63 42 the total value of all personal savings for retirement (%) Extremely/very confident they will 53 29 11 have a comfortable retirement (%)
Six tips for creating a written retirement plan 1 Make a bucket list of 6 Become a your retirement habitual saver! goals and aspirations 2 Assign a cost to 5 Consult a the things that are trusted on your bucket list adviser 4 Think about the 3 Figure out sacrifices you are where you prepared to make currently are now and in the future
Make a bucket list of your retirement goals and aspirations Think big and put everything on the list to start: things like travel, new hobbies, volunteering, etc. Decide on your priorities, what is realistic, and what is not. Revisit the list frequently and talk about it with friends and family. Sharing a goal can really help build your commitment to saving for it! Assign a cost to the things that are on your bucket list Think about where and how you would like to live as well as your goals and aspirations. How much will it cost to move closer to the grandkids? How expensive is a ticket to the Louvre and a hotel in Paris? Figure out where you currently are Calculate how much you have saved already and see how much you need to reach your goals. Make a monthly budget to see how much extra you can save based on your income and planned expenses. Set yourself some short and medium term savings goals to help get you on track.
Think about sacrifices you are willing to make now and in the future Are you prepared to save more now to reach your goals? Is moving or downsizing an option to manage expenses in the future? Are you prepared to work longer to reach your goals? Are there things you can trim from your bucket list? Consult a trusted adviser It is always good to check your plan with a trusted adviser to make sure that you are not forgetting anything and that your assumptions are realistic. Become a habitual saver! Now that you have a plan, get into the habit of saving on a consistent basis. Saving is like working out, it is hard at the start but the long term benefits are worth the effort.
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