To fix the world's retirement framework, analysts say, countries could start by...
1. Get everyone in. The Transamerica and Aegon analysts say programs should reach all workers. How this principle would affect financial professionals would depend on exactly what "universal access" means and how universal access is provided.
2. Make saving, and saving increases, automatic. The analysts say policymakers should take advantage of the power of inertia. Automatic allocation and increase strategies could hurt advisors who give cookie-cutter advice, but help advisors who can show how the personalized advice they offer is superior to what the robots spit out.
3. Educate. The analysts say workers who are saving for their own retirement need basic financial literacy. Expanded financial literacy programs might need people like you to help increase retirement savers' financial literacy.
4. Keep governments engaged. Even if workers save for themselves, the government still needs to arrange for affordable post-retirement health care, and to make sure that older people who want to work can still work, the analysts say. These efforts could create opportunities for financial professionals' associations to form alliances with groups that represent older workers, such as AARP.


5. Encourage annuitization. The analysts say workers who are saving for their own retirement need to be able to convert at least part of their savings into a lifetime stream of income. Like the universal access proposal, how this would affect financial professionals would depend on the details. The equivalent of individual retirement accounts for all might be better for financial professionals who serve indiviiduals than employer-based, automatic retirement plan annuitization provisions would be.

Life insurers could help the world save one of the critical problems facing governments all around the world:

Analysts at the Transamerica Center for Retirement Studies and the Aegon Center for Longevity of Retirement talk about how they would reboot the world’s retirement systems in a new report on retirement in the 21st century.

The authors include the results of a survey of 16,000 workers and retirees in 15 countries in  the Americas, Europe, Asia and Australia.

(Related: How 3 Generations Prepare for Retirement)

The analysts list steps that governments, and societies as a whole, should take to make things better. They suggest that one thing countries can do is simply to give employers more positive ideas about aging, and about what older people can do.

“Older individuals have wisdom and experience to share with younger generations,” the analysts write.

But ”stereotypical views of older people, aging, and retirement portrayed in the media and too frequently part of our daily conversation… are a significant barrier for older people who may want and/or need to stay in the workforce longer to save and prepare for a secure retirement,” the analysts write.

The analysts also include new survey data on use of life insurance and annuities in retirement.

This is what they found, for example, when the survey participants were asked about financial strategies for preparing for retirement:

  • 46% mentioned Social Security or other government programs.
  • 38% mentioned banking services, such as certificates of deposit.
  • 31% mentioned life insurance.
  • 9% mentioned fixed annuities.
  • 6% mentioned long-term care insurance.
  • 5% mentioned variable annuities.

Financial professionals might be interested in a section with the title “Forging the new social contract.” In that section, the analysts include ideas for reframing retirement systems that could, in some cases, change, eliminate or create markets for commercial retirement savings products.

For a look at some of those ideas, and how they might life agents and brokers, see the idea card gallery above.

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