In April 2014, the National Pension Commission,
PenCom, announced that the pension assets has hit 4.3 Trillion Naira, and also
stated that the operators in the scheme has 20 PFAs, 4PFCs, 7CPFAs, 19AES,and
morerecently the Police Pension Fund.
The astronomical increase in pension assets at the
point of writing this article may far in be excess of 4.7 Trillion, may have
been necessitated by the strict oversight functions of PenCom, the body vested
by the provisions of the Pension Reform Act as being responsible for the
supervision and control of the Pension Fund Administrators, Pension Fund
Custodians and other relevant players in the scheme.
The recent amendment of the 2004 Pension Reform
Act, which resulted in its repeal and the subsequent provisions of the Pension
Reform Act 2014 will positively consolidate more on the pension assets as the
relevant portions of the law has increased the coverage to states, local
governments, and employers with minimum of three employees.
What these portends is that of sustainability , a
market deepening and expansion which will definitely results in Larger pension
assets. But market deepening and expansion has its problemswhich includes handling the issue of customer
service delivery and incidence of high technological cost.
Technology is a paramount necessity in all spheres
of business life and pension cannot be an exception, linked to technology is
the issue of customer service delivery as the market deepening will come with
it, a larger customer base waiting to be serviced on a regular bases.
But far from these, the increase in Pension Assets
will definitely results in large investible funds for the real sector and
infrastructure, but the idea of investing in real sector and infrastructure
comes with ita myriad of problems like
corruption, inflation of contracts, kick back just to mention a few, what then
do we doas corruption or fraudulent
practices may results in the retiree not able to access his funds at the point
of retirement.
Henry Ford said “Think you can, think you can’t , either
way you will be right” and according to Robert Schuller 1988 “ I can ! Said the
retired postman.He was a rural mailman
for twenty years” Schuller (1988:64)
But when retired after two decades of postal
service in Makanda, Illinois Wayman has acquired a small pension and $1100 savings.
His travel company does nearly $7 million in sales a year with Presley Tours.
How does a retired mail man become a prosperous businessman and according to
Schuler, he did it by believing in himself and his abilities and by making
people happy. Schuller (op cited)
But in my own opinion Wayman succeeded because he
was doing what he loves most, and he has a positive mental attitude. Positive
attitude in life is that all that matters and secondlydoing whatever you have been assigned to do
with dedication and happinessirrespective of how much you are paid. According to research it has been
discovered that people who continued whatever they spend many years doing are
more likely to succeed than those who change vocation, job after retirement.
On how many people fail during retirement, is a
function of their ability to kick starting whatever they are used to even on a
smaller scale during old age. Old age comes with it issues, problems, non acceptance , health issues anda disconnect with current happenings in life,
there is also the generation gap, and so doing what you love most or whatever
you have been doing most is the key to survival. So a retired policeman, or army
officer can comfortable operate a security outfit and consultancy.
And how did Wayman arrived at that, “one day
someone said to him” I would love to see the ocean. That simple wish
enthusiasticallyexpressed to Wayman led
to a tour of 546 people to Miami Beach , Wayman made $120and had such a good time that he decided to
go into business” Schuller op cited.
But from my interaction with retirees within my six
years in pension industry, I want to believe that what drove Wayman was not the
money but the actual sharing of one’s thought and deepest hopes fulfilled. And
as Chinua Achebe will say the sharing of
one’s thought and deepest hope fulfilled can drive human beings to success. And
the keen desire to return and do what he was doing before was the actual
driving force for Wayman Presley.
It has been proved that people always wish for what
they don’t have, I believe that Wayman was looking forward to his retirement
during his working career but it did not take time for him to realize that he
could have love going back to work may be after staying for the initial period
of six months. That is the irony of life. The irony of life is that people tend
to be what they are not, that is why you see the whites sun tanning and the
blacks bleaching.
What this is indirectly saying is
that within the working career ,work with zeal and dedication, know all that you
need to know about the job, because you may never can tell, that you are
indirectlydeveloping a business for
yourself during old age.
In an article captioned “You may
never retired” that appeared in wall street journal it states” that sum sizable
number of retireesmay continue to work
after retirement due to so many reasons like their pension pot was not enough, they were ripped offof the retirement savings and majority
because they love what they do.
But a more interesting story was
the story of life of Mary Calendar, “Mary was making potato salad in an inn in
Los Angeles during world war 11, her boss asked her to make pies for a large
crowd. That was the start of a new career for Mary” Schuller (op cited).
Continuing he stated that in 1948, she and her husband sold their car, to buy a
refrigerator and an oven “in 1964 they open their first pie shop in Orange county
and by 1986, they sold the family business about 115 restaurants to Ramada Inn
Inc for $90 Million “What a tremendous accomplishment as that business may be
hitting 2 billion Dollars in 2014.
Finally life during retirement is
a great and rewarding life and what you make out of it is a function of the
zeal, knowledge and experience, you acquired during your working career and
when you are happy you are more likely to live long, and others will be jealous
of your state and according to Dave Bernard in an article captioned “Finding
Retirement state of mind” which appeared
in US News .he stated that “they appear to be genuinely
happy with their state of affairs and making the most of each day. When you ask
about their retirement experience they shine a genuine smile and are happy to
regale you – often at length – about how wonderful it is to be in their shoes.
Their happiness is infectious and you may find yourself caught up in their joy.
Although it is safe to assume not everything is perfect in their world, their
overall outlook is positive”. But when these are lacking, the retiree may
likely not live long, thereby prompting others to fear retirement.
Big mistakes are easy to catch, but even a small
miscalculation may jeopardize your retirement portfolio. Here are three
common missteps to avoid.
We think it’s the big mistakes that cost us in
retirement, like hiring an unscrupulous adviser or funneling savings
into a risky investment that goes belly up. Major errors can certainly
hurt. But the smaller seemingly sensible decisions we make without
really examining the rationale behind them can also come back to bite us
in the… Assiduous planning
is key to a secure retirement, but the effectiveness of plans we make
depends on the assumptions behind them. And when you’re making a plan
that extends well into the future, as is the case with retirement, even a
small miscalculation can take you way off course. Below are three
mistakes that may seem minor, but that can seriously erode your odds of
achieving a successful retirement. Make sure you’re not incorporating
these errors of judgment into your retirement planning. 1. Relying on an unrealistic rate of return.
Clearly, the higher the return you earn on the money in 401(k)s, IRAs
and other retirement accounts, the less you’ll have to stash away in
savings each month to build a sizable nest egg. For example, if you
start saving $600 a month at age 30 and earn a 7% annual rate of return,
you’ll have $1 million by age 65. Bump up that rate of return to 8% a
year, however, and you have to put away only $480 a month to hit the $1
million mark by 65, leaving you an extra $120 month to spend. Earn 9%
annually, and the monthly savings required to get to $1 million shrinks
to just $385 a month, freeing up even more for spending.
Problem is, just because a retirement calculator
lets you plug in a higher rate of return or a more aggressive
stocks-bonds mix, doesn’t mean that loftier gains will actually
materialize. Shooting for higher returns always involves taking on more
risk, which raises the possibility that your aggressive investing
strategy could backfire and leave you with a smaller nest egg than you
expected. That can be especially dangerous when you’re on the verge of
retirement.
For example, just prior to the financial crisis,
nearly one in four pre-retirees had more than 90% of their 401(k)s in
stocks. A pre-retiree with a $1 million retirement account invested 90%
in stocks and 10% in bonds would have suffered a loss in 2008 of roughly
33%, reducing its value to $670,000—enough of a drop to require
seriously scaling back retirement plans if not postponing them
altogether. No one knows whether recent market turbulence will be a
prelude to a similar meltdown. But anyone who has his retirement savings
invested in a high-octane stocks-bonds mix, clearly runs the risk of a
experiencing a significant setback.
A better strategy when creating your retirement plan is to keep your return assumptions modest and focus instead on saving as much as you can.
That way, you’re not as dependent on investment returns to build an
adequate nest egg. To see how different savings rates and stocks-bonds
mixes can affect your chances of achieving a secure retirement, check
out the Retirement Income Calculator in RDR’s Retirement Toolbox. 2. Factoring pay from a retirement job into your planning.
It’s almost become a cliche. Virtually every survey asking pre-retirees
what they plan to do in retirement shows that the overwhelming majority
plan to work. Indeed, a recent Merrill Lynch survey
found that nearly three out of four people over 50 said their ideal
retirement would include working. Which is fine. Staying connected to
the work world in some way can not only offer financial benefits, it can
also keep retirees more active and socially engaged.
It would be a
mistake, however, to factor the earnings you expect to receive while
working in retirement into your estimate of how much you have to save.
Or, to put it more bluntly, you’re taking a big risk if you assume that
you can skimp on saving because you’ll be make up for a stunted nest egg
with money from a retirement job.
Why? Well for one thing, what
people say they plan to do in 10 or 20 years and what they end up doing
can be very different things. You may find that the eagerness you feel
in your 50s to continue to working may fade as you hit your 60s and 70s.
Or even if you wish to work—and actively seek it through sites like RetiredBrains.com and Retirementjobs.com, it may not be as easy as you think to land a job you like. Maybe that’s why the Employee Benefit Research Institute’s Retirement Confidence Survey
finds year after year that the percentage of workers who say they plan
to work after retiring (65% in the 2014 RCS) is much higher than the
percentage of retirees who say they have actually worked for pay since
retiring (27%).
So when you’re making projections about income
sources in retirement, keep work earnings on the modest side, if you
factor them in at all. And don’t fall into the trap of believing you can
get by with saving less today because you’ll stay in the workforce
longer or rejoin it whenever you need some extra cash in retirement. Or
you may find yourself working some type of job in retirement whether you
like it or not. 3. Taking Social Security sooner rather than later. Although a recent GAO report
found that the percentage of people claiming Social Security at age 62
has declined in recent years, 62 remains the single most popular age to
begin taking benefits, and a large majority still claim benefits before
their full retirement age. But unless you have no choice but to grab benefits early on, doing so can be a costly mistake.
One
reason is that for each year you delay between 62 and 70, you boost the
size of your benefit roughly 7% to 8%. You’re not going to find a
low-risk-high-return option like that anywhere else in today’s financial
markets. More important, waiting for a higher monthly check can often
dramatically increase the amount of money you receive over your
lifetime. That’s especially true for married couples, who can take
advantage of a variety of claiming strategies to maximize their expected
benefit.
For example, if a
65-year-old husband earning $90,00 a year and his 62-year-old wife who
earns $60,00 claim Social Security at 65 and 62 respectively, they might
receive just over $1.1 million in today’s dollars in joint benefits
over their expected lifetimes, according 401(k) advice firm Financial
Engines.
But they can boost their estimated joint lifetime benefit by roughly $177,000, according to the Social Security calculator
on Financial Engines’ site, if the wife files for her own benefit based
on her work record at age 63, the husband files a restricted
application for spousal benefits at 66 and then switches to his own
benefit based on his work record at age 70.
Although you may not think of it this way, Social Security is, if not your biggest, certainly one of your biggest and most valuable retirement assets.
And chances are you’ll get more out of it by taking it later rather
than sooner and, if you’re married, coordinating the timing with your
spouse.
We’ve all heard it before: Americans are lousy when it comes to
saving for retirement. The justification for the lack of savings ranges
from economic hardship to our inability to escape the consumerism that
surrounds us on a daily basis. Regardless of the reason, many people
refuse to change their financial habits. However, options are available
to those who haven’t built a large nest egg for retirement.
An unsurprising portion of Americans have nothing saved for their golden years. According to a recent survey
by Bankrate, 33 percent of 30- to 49-year-olds have not saved any money
for retirement, while 26 percent of 50- to 64-year-olds say the same.
In fact, 14 percent of people 65 and older haven’t placed any money
aside for the future, either. Yet the majority of Americans feel the
same or better about their personal finances than they did last year.
How much do you really need to save for retirement? The answer
clearly depends on your own situation, but people are typically told
they need to save $1 million or more. It’s safe to say that many
Americans will not accomplish that milestone. Fortunately, there are
effective financial actions you can take to help compensate for a lack
of savings. Let’s take a look at three alternatives to accumulating a
million-dollar nest egg.
Source: Thinkstock
1. Delay retirement
The first alternative is the most obvious, but also the riskiest. If
your retirement funds are unable to generate sufficient income to
replace your day job, maintaining some form of employment in your later
years may be the solution for you. Delaying retirement can help improve
your finances and secure larger Social Security payments. For example,
someone born after 1960 can receive 124 percent of his or her monthly
Social Security benefit by retiring at age 70 instead of age 67. While
Social Security benefits could be taken as early as age 62, that person
would only receive 70 percent of his or her monthly benefit.
Although working longer is a dangerous strategy since your future
health status and job opportunities are unknown, many Americans appear
to be relying on this approach. According to a Gallup poll,
24 percent of baby boomers don’t expect to retire until they reach the
age of 65, and 39 percent of baby boomers don’t expect to retire until
they are 66 or older. A separate poll from Wells Fargo reveals that 37
percent of Americans with incomes between $25,000 and $100,000 say they
will never retire and will work until they are either too sick or dead.
Working longer may also reduce health care expenses in retirement.
Couples retiring at age 65 are expected to incur $220,000 in medical
costs on average during their golden years, according to an analysis by
Fidelity Investments. Couples retiring earlier, at age 62, and before
Medicare coverage experienced an average of $57,000 in additional costs.
Source: Thinkstock
2. Eliminate debt
Naturally, having fewer expenses in retirement reduces the need for
income. Instead of focusing on small actions such as skipping daily
lattes or canceling extra premium channels, make dramatic changes by
reducing the biggest bills first and retiring debt free.
Do you really need that oversized house with the accompanying
mortgage? Housing is easily one of the biggest expenses we have in life.
If you’re looking to give your retirement a financial boost, live in a
home that is affordable, not something that looks like it belongs on a
magazine cover. You won’t miss those empty rooms and you’ll sleep better
knowing that you have a mortgage-free retirement. Not having a $200,000
mortgage in retirement can save you $1,000 in monthly payments. If
you’re willing to plan far enough ahead, make extra payments each month
on your existing mortgage to pay it off sooner and save money on
interest payments.
Brand new cars and auto loans should also be avoided. The average
auto loan term increased to 66 months during the first quarter of 2014,
according to Experian Automotive. That is the highest level on record
and quite the burden for a retiree with little or no savings. Nearly 25
percent of all new loans originating during the quarter had terms
extending out 73 months to 84 months, and the average amount financed
for a new vehicle loan reached an all-time high of $27,612. A reliable
used car can be found for at least half that price.
Source: Thinkstock
3. Pack your bags
Retirement is no time to be feeling extra patriotic. Leaving
the comfort zone of America could help stretch retirement dollars
further. The world is a big place, so you need to research the
possibilities thoroughly, but plenty of publications around the Internet
offer good starting points. Live and Invest Overseas recently released
its 2014 Retire Overseas Index, naming the best countries for
retirement. Based on factors such as economic conditions, tax rates,
climate, and safety statistics, Portugal ranked as the top retirement
destination, followed by Ecuador and Malaysia.
If leaving the country is too unimaginable, you can still maximize
retirement savings by moving to a different state. Bankrate.com recently
listed
South Dakota, Colorado, Utah, North Dakota, and Wyoming as the best
retirement destinations within the United States. Yes, the winters are
brutal in some of these places, but weather probably shouldn’t be your
main concern if you haven’t saved enough for retirement.
“While the states that ranked highly may not be thought of as typical
retiree havens, seniors should consider more than sunshine when
choosing a place for their golden years,” said Bankrate.com research and
statistics analyst Chris Kahn. “The Dakotas both ranked in our top 10
for the second year in a row due to their low cost of living, low crime
rates, good health care quality, low taxes, and excellent satisfaction
scores from residents. Of course, the best place to retire will differ
drastically depending on the individual.”
Fireworks explode over downtown
Austin, Texas, in celebration of Independence Day on Thursday, July 4,
2013. (AP Photo/Austin American-Statesman, Jay Janner)
If you don't have a
traditional pension through your job and haven't been saving a
significant amount in a 401(k) or individual retirement account, Social
Security is likely to be your largest source of retirement income.
Almost all retirees (86 percent) receive Social Security payments, and
for over a third (36 percent) of retirees, Social Security accounts for
90 percent or more of their retirement income. The type of lifestyle
Social Security alone will provide largely depends on how much you have
earned in Social Security benefits and where you live.
The average
Social Security benefit for retired workers was $1,294 per month at the
end of 2013. A couple who each brought in this amount would have $31,056
in annual Social Security benefits, which will also be adjusted for
inflation each year. U.S. News analyzed Census Bureau and Bureau of
Labor Statistics data to determine where a retired couple age 65 or
older could cover their basic expenses, including typical costs for
housing, food, utilities, transportation and health care, on this
amount.
It's
important to note that in most places, Social Security alone barely
covered these basic expenses. After paying for those five major costs,
retirees living on Social Security alone likely won't have much cash
left over for recreation, hobbies, clothing, consumer goods or travel.
"If they are highly dependent on Social Security, it is not an easy
life," says John Palmer, a Syracuse University professor and former
public trustee for the Medicare and Social Security programs. "If they
own their own home and don't have high medical expenses, they can
probably get by."
Retirees
would often be much more comfortable if they had income from another
source in addition to Social Security, such as personal savings, a
part-time job or a traditional pension. Taking steps to maximize your
Social Security benefit is also important. "Not collecting until you are
in your late 60s, if you can do it, is a good idea," Palmer says. "For
every year you retire earlier than that and choose to collect Social
Security, your monthly benefit is about 7 to 8 percent less, and for
every year you delay up to age 70, your benefit increases by 8 percent."
In
expensive cities including San Jose, California, Honolulu and San
Francisco, Social Security alone did not cover the basic costs retirees
face. "I wouldn't want to try to make it just on Social Security in New
York City or the D.C. area, but in a lot of the rest of the country, the
cost of living is substantially lower," says Kenneth Robinson, a
certified financial planner for Practical Financial Planning in
Cleveland. "Moving has expenses that go along with it, but if you have
relatives who live in a less expensive place than where you are now, you
might want to consider a move."
In these cities, a household with
typical expenses and two average Social Security checks coming in could
get by on Social Security income. Here are 10 places where it's
possible for retirees to cover basic costs on Social Security alone: Albuquerque, New Mexico
Albuquerque
homeowners age 65 and older pay a median of $1,078 per month if they
have a mortgage and just $368 monthly if they have paid off the
mortgage. Senior citizen renters pay a median of $686 monthly to live in
Albuquerque. The city also provides many services to retirees who don't
have a lot of extra cash. There are six senior centers where people age
50 and older can become members for just $13 a year. The Albuquerque
50+ Games is an athletic competition that includes bocce ball, tennis
and pickleball exclusively for people 50 and older. And New Mexico
residents age 65 and older can take classes at the University of New
Mexico for just $5 per credit hour. Austin, Texas
The
low housing costs in Texas are drawing people to the state. A home in
Austin costs retirees a median of $1,395 monthly with a mortgage and
$545 if they own their home debt-free. The median rent for retirees age
65 and older is $887 monthly. Texas doesn't have a state income tax, but
it's important to carefully consider the property tax you might face on
any home purchase. This state capital city typically has mild and sunny
winters that largely eliminate high heating bills, although you may pay
significant cooling costs during the hottest summer months. Seniors age
65 and older even qualify for a tuition wavier on up to six credit
hours at the University of Texas at Austin. Buffalo, New York
If
you can tolerate the cold and snowy winters in this upstate New York
city, you'll be rewarded with a very low cost of living. Senior citizen
homeowners pay just $466 monthly in housing costs if they have paid off
their mortgage and $1,009 monthly if they are still making payments on
their home. The typical rent for retirees age 65 and older is $611
monthly. The City of Buffalo also provides a senior discount card that
entitles retirees to a percentage off their purchases when they shop at
local businesses, including restaurants, salons and pharmacies.
Columbia, South Carolina
South
Carolina's capital city has 60 city parks and green spaces, and seniors
can also get discount tickets to a variety of local attractions,
including the Riverbanks Zoo and Columbia Museum of Art. South Carolina
residents age 60 and older who are no longer working are also eligible
for free tuition at the University of South Carolina. Housing remains
affordable, costing retirees $1,074 monthly with a mortgage, $367 with a
paid-off house or $801 in monthly rent. And Social Security income is
not taxed at the state level.
Grand Rapids, Michigan
This
small city is becoming known for its outsized art scene, which includes
the Frederik Meijer Gardens & Sculpture Park, Grand Rapids Art
Museum, Urban Institute of Contemporary Arts and the art competition
ArtPrize. There are also plenty of opportunities for outdoor activities
at the 74 city-owned parks with 1,210 acres of land, the Grand River and
nearby Lake Michigan. Retirees age 65 and older pay just $684 monthly
in rent. Older homeowners pay $1,080 monthly with a mortgage and $427
per month if their house is paid off. The city is also the hometown of
U.S. President Gerald Ford and houses his presidential museum. Jacksonville, Florida
Jacksonville
offers balmy winters similar to other parts of Florida, but at much
more affordable prices than Miami or Fort Lauderdale. Retirees age 65
and older pay a median rent of $861 per month. Older homeowners pay a
median of $1,247 per month if they have a mortgage, which drops
significantly to $405 once they pay off the house. The St. Johns River
bisects the city and offers plenty of fishing and boating opportunities.
Jacksonville is also a short drive from the Atlantic Ocean and boasts
22 miles of white-sand beaches. An added bonus: There's no state income
tax in Florida.
Pittsburgh
Pittsburgh
is a world-class city that isn't priced like one. Pittsburgh has
several professional sports teams, noteworthy museums and several major
colleges, including the University of Pittsburgh and Carnegie Mellon
University. The UPMC-University of Pittsburgh Medical Center is ranked
13 th in the country in geriatrics. But housing prices remain
affordable. Senior citizen homeowners pay a median of $1,023 monthly
with a mortgage and $434 when they have paid off their house. Retiree
renters pay a median of $614 per month. Social Security income isn't
taxed at the state level in Pennsylvania. Plus, residents age 65 or
older ride free on the bus, T or Monongahela Incline, thanks to a
program funded by Pennsylvania Lottery proceeds.
Spokane, Washington
The
Spokane River flows through downtown Spokane and can be enjoyed at
Riverfront Park, one of the city's numerous recreation areas for hiking
and biking. Washington state does not have an individual income tax, and
housing in retirement is affordable, costing just $419 monthly with a
paid-off house and $1,139 per month with a mortgage. The median rent for
people age 65 and older is $733 monthly. The city partially funds
Project Joy, a group of entertainers age 50 and older who perform at
assisted living facilities, retirement complexes and other venues.
St. Louis
People
who live in St. Louis know you don't need to pay excessively high
housing prices to live in a place with professional sports teams,
museums, gardens and parks. Home costs for seniors are $1,115 monthly
with a mortgage and $434 per month with a paid-off house, while renters
pay a median of $664 monthly. There are also services to help seniors
get to doctor appointments and the grocery store, and the St. Louis Area
Agency on Aging runs a program that connects senior citizens age 60 and
older with volunteers and youth groups willing to provide chores that
include yard work, painting and gutter cleaning at no cost. The
Barnes-Jewish Hospital/Washington University is nationally ranked in
geriatrics.
Tucson, Arizona
This
Sonoran Desert city is surrounded by five mountain ranges and is famous
for its enormous cactuses. Retirees can take in the giant saguaros at
Saguaro National Park, where U.S. citizens age 62 and older can get a
lifetime pass to this and other national parks for just $10. Yet this
sunny city remains affordable. Monthly rent for people 65 and older is a
median of $771. Older homeowners pay $1,095 monthly with a mortgage,
but that drops significantly to $366 for people who have paid off their
homes. The University of Arizona offers affordable classes for seniors
through its Osher Lifelong Learning Institute. Plus, the state of
Arizona doesn't tax Social Security income.
People enjoy the sunshine on
the bank of the lake of Geneva in front of the Swiss Alps near the
Chateau de Chillon (Chillon Castle) in Veytaux near Montreux,
Switzerland, Sunday, April 20, 2014. (AP Photo/Keystone/Salvatore Di
Nolfi)
The global population is aging rapidly. Today, there are
roughly 868 million people who are at least 60 years old globally, or
about 12% of the world’s population. By 2050, more than 2 billion people
will be 60 or older, or 21% of the projected global population. In the
United States, 27% of all Americans will be at least 60 years old.
HelpAge International’s “Global AgeWatch 2014 Index”
ranked the social and economic well-being of older residents in 96
countries. The report rated each country on four broad factors important
to an aging population: supporting income security, fostering good
health, employment and education, and the overall environment for older
residents.. Norway was rated as the best country for older people to
live in, bypassing Sweden, last year’s top-rated country. Meanwhile,
Afghanistan was rated the worst country for older people for the second
consecutive year.
Generally,
wealthy countries are better able to provide for their residents than
poor countries. All but one of the top 10 countries had a GDP per capita
of at least $30,000. At the other end of the spectrum, just one of the
10 worst-rated countries had a per capita GDP of more than $5,000.
However,
Kate Bunting, CEO of HelpAge USA, told 24/7 Wall St. that being a
wealthy nation alone is not enough for a country to rate well. “We focus
on a multidimensional look at being older,” Bunting said. The ability
of older people to continue working and ensuring that they do not feel
socially isolated are examples of important factors not necessarily
captured by GDP, Bunting added. Despite the challenges of crafting
policies to help an older population, “We feel that global aging is
really a triumph of development.”
Wide-ranging pension coverage is
one factor that can help the elderly population of a country. In many
of the 10 highest-rated countries, 100% of the population 65 and over
receives a pension. According to HelpAge International, only half of the
global population can expect to receive a pension of any kind in old
age.
Providing for older residents’ long-term health is also a
critical factor in a country’s ranking. In each of the top 10 countries
to grow old in, a resident who is 60 years old can expect to live at
least another 23 years, on average. However, in all of the worst
countries to grow old in, the average life expectancy for a 60 year old
resident is less than 20 years, with four of these nations reporting
average life expectancies at 60 of just 16 years.
An aging global
population creates new challenges -- and opportunities -- for policy
makers. According to Bunting, “We can start thinking about this as an
opportunity for us to think globally about the kinds of policies we need
in place in order for people ... to age comfortably.”
Within the
specific context of the United States, which ranked as the eighth best
country to grow old in, improving access to health care is an important
challenge. Additionally, while the U.S. has a strong social protection
system, in the form of Social Security, “there are still challenges with
that system,” Bunting said. The poverty rate among the American elderly
is also an issue of concern.
To identify the best and worst
countries to grow old in, 24/7 Wall St. reviewed HelpAge International’s
2014 Global AgeWatch Index of 96 countries. Each country was graded
based on four measures: income security, health status, employment and
education, and the overall environment for older residents. All data are
for the most recent available period at the time the report was put
together. We also reviewed figures from the IMF for population,
inflation, debt, and other economic variables.
These are the best (and worst) countries to grow old in. The Best Countries To Grow Old In: 5. Germany
.
People enjoy a leisure day in downtown Duesseldorf, Germany. (AP Photo/Martin Meissner)
> Total population: 80.9 million > Pct. population aged 60+: 27.5% (2nd highest) > GDP per capita: $34,620 (18th highest) > Life expectancy at 60: 24 (tied-13th highest)
Germany
currently has the second highest proportion of residents aged 60 and
older, at 27.5% of the population, trailing only Japan. By 2040, this
figure will rise to nearly 40% of the population. Germany’s population
has grown little in recent years, with German Federal Statistical Office
data indicating that immigration has offset the decline in the
population of native Germans. Still, with 100% pension coverage for
seniors, and a GDP per capita $34,620, among the better figures in the
world, few nations few nations provide better income security in old age
thanGermany. Additionally, Germans over 60 years old are generally
well-educated and can expect to live quite long, making Germany one of
the best nations to grow old in. 4. Canad.
People play a game of pickup soccer in downtown Toronto. (REUTERS/Mark Blinch)
> Total population: 35.5 million > Pct. population aged 60+: 21.7% (29th highest) > GDP per capita: $35,739 (15th highest) > Life expectancy at 60: 25 (tied 2nd highest)
Few
countries provided better health care for the elderly than Canada. A 60
year old Canadian could expect to live 25 years, 18.3 of which will be
in good health, both among the highest figures in the world. Residents
over 50 were also just as likely as younger adults to feel their life
was meaningful -- an important indicator of mental well-being and a
measure in which most countries performed far worse than Canada. Each
province and territory in the country provided its residents with
insurance for medically necessary care, although many Canadians also had
private supplementary coverage. 3. Switzerland
.
Downtown Bern with the Swiss Alps in the background. (REUTERS/Ruben Sprich)
> Total population: 8.1 million > Pct. population aged 60+: 23.6% (21st highest) > GDP per capita: $39,301 (10th highest) > Life expectancy at 60: 25 (tied 2nd highest)
No
country generated a better enabling environment for older residents
than Switzerland. The vast majority of Swiss residents over 50 surveyed
said they had someone to count on in an emergency, had personal freedom
in their lives, and were satisfied with public transit where they lived.
Elderly residents in Switzerland were also among the healthiest in the
world. A 60 year old Swiss resident could expect to live 19 more years
in good health, more than almost any other nation. With a GDP per capita
of $39,301, Switzerland is one of the world’s wealthier countries. All
residents 65 and older also received a pension. Despite these facts,
17.6% of Swiss people 60 and older lived in poverty, a relatively high
rate.
2. Sweden
.
The sun sets over the Grand Hotel in downtown Stockholm. (REUTERS/Henrik Montgomery/Scanpix Sweden)
> Total population: 9.7 million > Pct. population aged 60+: 25.6% (7th highest) > GDP per capita: $34,862 (17th highest) > Life expectancy at 60: 24 (tied-13th highest)
More
than one quarter of Swedes are at least 60 years old, one of the
highest proportions in the world. And while this figure is expected rise
to 28.5% by 2050, this represents a far-slower growth in the elderly
population than in many countries. Older Swedes are more likely than
their counterparts in most countries to have income security, as 100% of
the population 65 and older received a pension, and just 5% of
residents 60 and older lived below the poverty line, one of the lowest
rates in the world. Further, older Swedes were among the most likely
people in the world to be capable of working at an advanced age. They
were also among the most likely to state that they lived in an enabling
environment. 1. Norway
.
A woman walks her dog near the marina in downtown Bergen, southwestern Norway. (REUTERS/Stoyan Nenov)
> Total population: 5.1 million > Pct. population aged 60+: 21.8% (27th highest) > GDP per capita: $46,733 (5th highest) > Life expectancy at 60: 24 (tied-13th highest)
Norway
is the best country in the world to grow old in, according to HelpAge.
Older Norwegians had better income security than their counterparts
anywhere else in the world, with a universal pension and GDP per capita
of $46,733, fifth highest among countries reviewed. Just 1.8% of people
over 60 lived below the poverty line, one of the lowest rates worldwide.
Additionally, over 99% of residents 60 and over had completed at least a
secondary education, the highest rate in the world. Further, nearly 96%
of residents over 50 said they were happy with the level of personal
freedom in their lives, the second highest percentage in the world. The Worst Countries To Grow Old In: 5. The United Republic of Tanzania
.
A destroyed house that was hit by a rocket in the capital Dar es Salaam (Khalfan Said/AP Photo)
> Total population: 47.7 million > Pct. population aged 60+: 4.9% (36th lowest) > GDP per capita: $1,331 (24th lowest) > Life expectancy at 60: 18 (tied-63th lowest)
While
nearly 93% of 55-64 year old Tanzanian residents were employed -- the
second highest rate worldwide -- many of these jobs were likely
low-skilled. Just 3.1% of country residents over 60 had completed at
least a secondary education, one of the lowest attainment rates in the
world. Further, less than 40% of residents over 50 were satisfied with
the country’s public transportation options, worse than in the vast
majority of nations worldwides. Like many countries in the region,
Tanzania is quite poor, with a GDP per capita of just $1,331, one of the
lowest in the world. Despite poor economic output, Tanzania has managed
to avoid violent internal turmoil that is often common in African and
Middle-Eastern nations.
4. Malawi
.
Villagers walk to a local market in Galufu, Malawi (Per-Anders Pettersson/Getty Images)
> Total population: 17.6 million > Pct. population aged 60+: 4.9% (35th lowest) > GDP per capita: $667 (6th lowest) > Life expectancy at 60: 16 (tied-11th lowest)
Malawi
is exceptionally poor, with an economic output of just $667 per capita.
The U.S., by contrast had a GDP of nearly $45,000 per capita. Nearly
all of Malawi’s 55-64 year old population worked, with an employment
rate of 96.6%, by far the highest among countries reviewed. Yet, like in
several other nations in the region, elderly residents are poorly
educated. Just 4.5% of people over 60 had completed at least a secondary
education, much less than in most countries. While the high employment
rate may help some older residents feel independent, less than half of
people over 50 said they had someone they could count on when in
trouble, one of the worst measures of social connectivity. Nearly 18% of
Malawi residents over 60 also lived in poverty, one of the higher rates
worldwide. 3. West Bank and Gaza
.
The destroyed houses in an area east of Beit Hanoun in the northern Gaza Strip. (AP Photo/Adel Hana)
> Total population: N/A > Pct. population aged 60+: 4.6% (28th lowest) > GDP per capita: $2,465 (48th lowest) > Life expectancy at 60: 18 (tied-63rd lowest)
The
West Bank and Gaza, separated by miles of Israeli territory, are nearly
the worst regions in which to grow old. Palestinians and Israelis have
been in a nearly continuous conflict, and tensions may worsen as Hamas
recently renewed its political presence in the West Bank. While nearly
three-quarters of people over 50 felt safe walking home and approved of
the public transport system -- both among the higher rates reviewed --
just 30% of residents aged 55 to 64 had a job, nearly the lowest rate.
Poor employment and political turmoil may have also contributed to only
41% of Palestinians over 50 feeling freedom in their lives, one of the
lower rates among countries reviewed. 2. Mozambique
.
Mozambique (Getty Images)
> Total population: 26.5 million > Pct. population aged 60+: 5.1% (40th lowest) > GDP per capita: $842 (8th lowest) > Life expectancy at 60: 16 (tied-11th lowest)
Located
on the Indian Ocean in southeastern Africa, Mozambique has struggled
with a long history of colonialism and civil war. While the country has
stabilized considerably since its independence in 1992, Mozambique is
still quite poor. The nation’s GDP per capita was just $842 last year,
among the lowest economic outputs worldwide. The country’s weak economy
is likely having some effect on the well-being of elderly residents, as
nearly 20% of people over 60 lived in poverty, considerably higher than
in most other countries. Less than a third of Mozambique residents over
50-years old felt safe walking home at night, nearly the worst rate.
1. Afghanistan
.
A man pulls his handcart in Kabul. (REUTERS/Omar Sobhani)
> Total population: 31.3 million > Pct. population aged 60+: 3.9% (11th lowest) > GDP per capita: $1,225 (8th lowest) > Life expectancy at 60: 16 (tied-11th lowest)
Afghanistan
is the worst country for the elderly. At 60 years old, Afghan residents
could expect only 9.2 years of good health -- one of the only nations
in the world where healthy life expectancy at 60 was less than a decade.
While older Afghans were more likely to work than older residents in
other countries, people over 60 were very poorly educated. Just 5.2% had
completed at least a secondary education, among the lowest rates
worldwide. While the U.S. and its allies have considerably reduced its
military presence in the country, Afghanistan has been the site of
conflict for decades. The withdrawal of the U.S. from the country could
also further imperil the nation’s political and economic stability.
