Pensions ‘Perfect Storm’ Looms For Unprepared World HSBC Insurance Study Reveals
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Clive Bannister, Group Managing Director of HSBC Insurance: Pensions Perfect Storm Quote
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Clive Bannister, Group Managing Director of HSBC Insurance: Full Future of Retirement – It’s Time To Prepare Discussion
A ‘PERFECT STORM’ of demographic, individual and financial elements is poised to derail people’s retirement plans unless they prepare properly now, a global survey from HSBC Insurance reveals today (Wednesday 10 June).
The fifth annual Future of Retirement study, It’s Time to Prepare, shows:
The consequence of these combined factors is that many people will struggle to make ends meet when they come to retire, unless they urgently review their priorities and planning.
Stephen Green, Group Chairman of HSBC, said: “A perfect storm is confronting pensions planning, created by an ageing population, falling pension funds values, a drop in state and employer contributions and an economic downturn which is forcing people to make tough financial choices.”
The preparedness gap
The Future of Retirement survey, which questioned 15,000 people in 15 countries, making it the largest study of its kind in the world, reveals:
Stephen Green continued: “The ‘preparedness gap’ reveals that families need greater support and guidance to effectively handle their finances, not simply in schools and colleges but through ‘trusted advisers’ providing professional financial guidance.
“If people prepare adequately for the long-term an extended later life can present a golden opportunity for many – but now is the time for people to seriously consider boosting their pensions contributions to improve their prospects of a comfortable retirement. The cost of procrastination is likely to be high.”
Advice gap opens up
Clive Bannister, Group Managing Director, HSBC Insurance, said: “This year’s Future of Retirement report reveals a need for people to have access to more and better financial advice and guidance to help them survive the downturn while making the right financial decisions for the long-term.”
Coping with the downturn – possessions not pensions?
General insurance solutions – motor, travel, home and even pet insurance – are seen as a greater priority than addressing longer-term needs around insuring health or income, even when job security is in question.
Despite global economic uncertainty, only 6% intend to take out income protection insurance in the next 12 months compared to 16% insuring their home.
The Future of Retirement survey shows that, as a result of the economic downturn:
Mark Twigg, Director at financial services consultancy Cicero Consulting, which undertook the survey for HSBC Insurance, said: “It’s Time to Prepare reveals the lack of understanding people have around their long-term retirement needs. They are less well educated or aware when trying to understand these needs and to act on them, than with their short-term requirements.
“As the economic ‘perfect storm’ threatens it is important that people are encouraged to understand long-term risks and to manage them effectively. While people are taking more responsibility for themselves, there is also a definite role for financial institutions to continue, and to build on, their work to educate and inform.”
The Future of Retirement:
The report findings are crucial to HSBC meeting the needs of its 128 million customers worldwide.
Countries surveyed for It’s Time to Prepare include: Brazil, Canada, China, France, Hong Kong, India, Japan, Mexico, Saudi Arabia, Singapore, South Korea, Turkey, UAE, UK, and US
For further information visit http://www.hsbc.com/1/2/retirement/future-of-retirement/future-of-retirement-press-room
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