Not so long ago it was a surprise that people were living so long. Now we constantly hear “we are all living longer”. But recent mortality data in the UK surprised in the opposite direction: more people have died than expected. It’s complicated, but it looks like a slowing down rather than a reversing of the trend towards longer lives. We are still likely to keep living longer. Policy makers and anyone planning retirement need to keep anticipating longevity improvements.
It’s striking that how to decumulate – how to organise savings for income in retirement – is a hot topic right now in many countries. Why aren’t solutions ready?
Every developed country is facing up to how people should manage their money in retirement. New Zealand is no exception, but is unusual in having no annuity market. If annuities came to New Zealand, would the problem be solved?