5 Developing Threats to Retirement Security
The COVID-19 pandemic, economic crises and other issues have intensified longer-term threats to retirement security, including record levels of public debt, lower for longer rates, climate quality and income inequality.
In a supplemental report to the 2020 Global Retirement Index released this week by Natixis Investment Managers, titled “What Could Possibly Go Wrong?,” Natixis identifies five specific issues that the firm believes present the greatest threats for retirement security in the future. They include:
- The long-term impacts of the recession on savings: The speed and severity of the global economic slowdown stemming from the COVID-19 outbreak are greater than those in recent recessions. Resulting measures taken to cover income shortfalls may dampen the savings needed for future retirement security. For instance, workers may make hardship-based early retirement withdrawals that are never replaced, and employers may reduce or suspend matching contributions to defined contribution plans, steps that may become permanent.
“The Natixis Global Retirement Index is an accurate snapshot of retirement security that serves as an important guide for policymakers,” said Edward Farrington, Head of Retirement Strategies at Natixis Investment Managers. “At the same time, the COVID-19 pandemic, economic crises and other issues that have come to light this year have intensified longer-term threats. It will be important for individuals, employers, institutional investors, asset managers and policymakers to plan for how they will take on the challenge of retirement security in the years and decades to come.”
The report provides suggestions for how individuals, employers, institutional investors, policymakers and asset managers can begin to address these trends now. For more information, download the 2020 Global Retirement Index here.
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.
