December 2018

13Dec

Is Latin America Prepared for an Aging Population?

Latin America, while still comparatively young, is aging fast. Our research finds that population aging is challenging the fiscal sustainability of public pension and health care systems in the region. Policymakers will need to ensure adequate benefits for the rising share of older people—notably their social acceptability—by supporting formal employment and gradually reforming pension and healthcare systems. Demographic dividend Latin American countries are still younger than most advanced economies, but population aging is expected to accelerate. Today Latin American women have on...

December 13, 2018
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13Dec

Aging Japan: Dementia puts financial assets of the elderly at risk

“What’s a microwave?” she asked her husband, Eiichi. Yumiko was in the early stages of dementia, struggling with vocabulary and unable to teach the kimono-dressing classes she had run for 25 years. The difficulty with everyday tasks has made life challenging for her and Eiichi, who has been caring for her since 2008. But she is also unable to deal with her finances - a situation that experts say is increasingly common in fast-ageing Japan and that puts trillions of yen worth...

December 13, 2018
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13Dec

US. Pension Risk Transfer Volume Falls

A LIMRA analyst sees strong demand for small and midsize deals. U.S. life insurers reported a small drop in pension plan buyout annuity sales in the third quarter. Pension risk transfer sales fell to $6.3 billion, down from $6.4 billion in the third quarter of 2017, according to survey data from the LIMRA Secure Retirement Institute. The institute bases the survey results on data from 16 companies that share information about their sales of large, single-premium group annuity contracts. Pension risk transfer volume...

December 13, 2018
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13Dec

Older Australians living overseas will need to prove they are alive to keep getting pension

Australians aged over 80 who are living overseas will soon have to produce a "proof of life certificate" to continue receiving the pension. From July 1, pensioners will be asked to go to an Australian embassy or consulate every two years to register that they are still alive and entitled to receive a welfare payment. Social Services Minister Paul Fletcher said estimates suggested there had been thousands of cases where a person died while living overseas but continued to receive the...

December 13, 2018
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12Dec

US. No, Retirement Plan Participation Isn’t Plummeting

This week the Schwartz Center for Economic Policy Analysis (SCEPA) published a short article claiming that “New Data Shows Drop in Retirement Coverage for All Income Levels,” contributing to the narrative that Americans face a “retirement crisis” that government must step in to address. In reality, the article should have been titled “Bad Data Show Drop in Retirement Coverage for All Income Levels,” because the decline in retirement plan coverage reported by SCEPA is almost surely a problem with...

December 12, 2018
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12Dec

Sustainability is about survival

As we report in this issue, investing is no longer seen as just a good cause, but at once a golden opportunity and a global imperative. Speaking at the UNDP’s Social Good Summit in Geneva in October, Marcus Neto, director of the UNDP’s Istanbul International Centre for Private Sector in Development, spoke repeatedly and unambiguously of a “pot of gold” waiting for investors in the UN Sustainable Development Goals. That doesn’t sound like the kind of language familiar from...

December 12, 2018
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12Dec

UK watchdog orders shake up of advisors to pension trustees

Poor competition in the market for advice to pension fund trustees has resulted in "substantial customer detriment", Britain's Competition and Markets Authority said on Wednesday. UK pension schemes have total assets of 1.6 trillion pounds ($2.04 trillion), and the dominant advisors are Aon, Mercer, and Willis Towers Watson. Half of pension schemes buy fiduciary management that makes investment decisions on their behalf, from their existing investment consultant. It announced a range of reforms to the investment consultancy and fiduciary management sector, saying...

December 12, 2018
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12Dec

Pension savings withdrawal made 100% tax free in India

The government has made the NPSmore tax friendly by offering complete tax exemption to the 60% of the corpus that an investor can withdraw on maturity. When they retire, NPS investors have to use 40% of the corpus to buy an annuity and can withdraw the remaining 60% of the corpus. Till now, only 40% of this withdrawn amount was tax free, while the remaining 20% was taxed. Last week, the Union Cabinet approved a proposal to enhance the tax exemption limit to...

December 12, 2018
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12Dec

Greece cancels pension cuts after budget improvements

Greek lawmakers have voted to cancel a major round of pension cuts which were to take effect on Jan. 1, following a fast-track debate procedure in parliament. Lawmakers in the 300-seat parliament voted unanimously late Tuesday in favor of canceling the cuts that would have been worth around 1 percent of Greece's annual GDP. The measures would have seen 1.4 million of Greece's 2.6 million pensioners suffer monthly losses of at least 14 percent, according to European Commission estimates. Greece's third and...

December 12, 2018
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11Dec

US. Saving Infrastructure and Pensions at Once? That’s Ambitious

A plan to sell $300 billion of 40-year bonds only to pension funds cuts out too many investors. Every politician in Washington loves infrastructure, in theory. Nancy Pelosi said in October that one of her goals was to “build the infrastructure of America from sea to shining sea.” President Donald Trump has promised to “build gleaming new roads, bridges, highways, railways and waterways all across our land.” Yet time and again, details end up derailing any efforts to fix what’s...

December 11, 2018
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