Across the globe, retirement is lasting far longer, posing a financial challenge for individuals and institutions. So far, policies have not adapted to this change.
Our research paper "Global Demographics and Retirement Implications" analyzes the impacts of demographic change and what this means for society and retirement savings systems.
We are switching gears. The way we live, work, consume, and save
are changing not only in our market, but across the globe.
As analyzed in our research, these changes are accelerating within retirement savings schemes as the responsibility for funding retirement increasingly falls to the individual, thanks to a shift from traditional defined-benefit pensions to rising defined-contribution constructs. Lifestyle and life-expectancy changes coupled with increased savings autonomy suggest a new retirement paradigm; however, attitudes, policies, and infrastructures haven’t kept pace, creating the potential for significant strain on social systems. But there is an opportunity for governments, employers, and individuals to get ahead of and correct for the societal stress that could come from mismatched population and retirement savings infrastructure dynamics.
At State Street, we have experience with preparing each vital constituent for the new era of retirement, from participants, to employers, to governments seeking policy insights. To learn more about how our interdisciplinary team can support your organization in facilitating change, contact us.
The World is Aging
Not only are people living longer, but older people are quickly
becoming the largest cohort across the globe.
Retirement Now Lasts Much Longer
People who retire earlier and live longer are facing decades during which expenses must be met. This new, extended phase in life increases the potential for financial insecurity, creating a burden on governments, employers, and working individuals.
Dependency ratios — used to measure the pressure on productive populations by dependent populations
(such as retirees) — are under strain. One solution to both the data and the human experience is to shift the expected working-life boundaries to reflect the new demographic era.
For some, extending working life is not feasible. For others, working longer and more flexibly, could promote:
Such advantages can translate into healthier and more secure citizens, contributing to longer-term societal benefits.
Stepping Stones to Change
Find Out More
For deeper insight into the global impacts of demographic change on how people work, consume, and save — and what this means for societal and retirement savings infrastructures — read our thinking on Global Demographics and Retirement Implications.
The practice of enrolling employees in a retirement savings planautomatically, used by some employers to promote participation. Auto-enrolled individuals are given a default savings rate and investment fund, which they can then modify or opt out of entirely.
The automated increase of a participant’s rate of contribution to their defined contribution plan, designed to encourage the participant to save more.
Default Investment Vehicles
Investments used by plan sponsors as the default for any participant whom they have automatically enrolled in a retirement savings plan.
Defined Benefit Plan
An employer-sponsored retirement plan where employee benefits are derived from a specified formula using factors such as, but not limited to, salary history and duration of employment. Investment risk and portfolio management are entirely under the control of the company.
Defined Contribution Plan
An employer-sponsored retirement plan whereby employees make contributions to accumulate wealth during their working years to provide income in retirement. Often times, an employer will match an employee’s contribution,
up to a certain amount.
United States: State Street Global Advisors, 1 Iron
Street, Boston, MA 02210. T: +1 617 786 3000
Investing involves risk including the risk of loss of principal.
The whole or any part of this work may not be reproduced, copied or transmitted or any of its contents disclosed to third parties without SSGA’s express written consent.
The information provided does not constitute investment advice and it should not be relied on as such. It should not be considered a solicitation to buy or an offer to sell a security. It does not take into account any investor’s particular investment objectives, strategies, tax status or investment horizon. You should consult your tax and financial advisor. All material has been obtained from sources believed to be reliable. There is no representation or warranty as to the accuracy of the information and State Street shall have no liability for decisions based on such information.
The trademarks and service marks referenced herein are the property of their respective owners. Third party data providers make no warranties or representations of any kind relating to the accuracy, completeness or timeliness of the data and have no liability for damages of any kind relating to the use of such data.
Before investing, consider the funds' investment objectives, risks, charges and expenses. To obtain a prospectus or summary prospectus which contains this and other information, call 1-800-997-7327, download a prospectus or summary prospectus now, or talk to your financial advisor. Read it carefully before investing.
Distributor: State Street Global Advisors Funds Distributors, LLC, member FINRA, SIPC, an indirect wholly owned subsidiary of State Street Corporation. References to State Street may include State Street Corporation and its affiliates. Certain State Street affiliates provide services and receive fees from the SSGA Funds.
THIS SITE IS INTENDED FOR U.S. INVESTORS ONLY.
No Offer/Local Restrictions
Nothing contained in or on the Site should be construed as a solicitation of an offer to buy or offer, or recommendation, to acquire or dispose of any security, commodity, investment or to engage in any other transaction. SSGA Intermediary Business offers a number of products and services designed specifically for various categories of investors. Not all products will be available to all investors. The information provided on the Site is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation.
All persons and entities accessing the Site do so on their own initiative and are responsible for compliance with applicable local laws and regulations. The Site is not directed to any person in any jurisdiction where the publication or availability of the Site is prohibited, by reason of that person's nationality, residence or otherwise. Persons under these restrictions must not access the Site.
Information for Non-U.S. Investors:
The products and services described on this web site are intended to be made available only to persons in the United States, and the information on this web site is only for such persons. Nothing on this web site shall be considered a solicitation to buy or an offer to sell a security to any person in any jurisdiction where such offer, solicitation, purchase or sale would be unlawful under the securities laws of such jurisdiction.
Not FDIC Insured * No Bank Guarantee * May Lose Value