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.
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.
Although our survey found that respondents are best prepared with respect to saving and acquiring information, respondents are least prepared with respect to:
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:
If you have any questions regarding our policy and public affairs work, please contact the IFoA Policy Team.