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Retirement Readiness: a focus on Japan

The Hague, January 18, 2013

Following the Retirement Readiness Survey, Aegon has released a supplemental report on aging trends within Japan. Read more about the country’s “Silver Century” in this full report.

Japan is known for enjoying one of the highest life expectancies in the world, but it may be less known that the country also faces one of the lowest birthrates. An estimated 40% of the population will comprise of individuals 65 or older by the year 2060, resulting in what is being referred to as the "Silver Century". While these statistics may be concerning, a larger concern is how Japan prepares itself as a significant portion of their population enters retirement.

Japanese couple outside

Key findings
"All of the countries researched as part of the Aegon Retirement Readiness Survey are faced with an aging society. Yet, Japan finds itself at the forefront of this demographic trend..."

The Japanese were traditionally known for being good savers, but this trend has changed since the mid-1990's. Aegon's study has revealed that the collapse in "Japan's saving rates has been so stark that household savings behavior now lags behind other countries surveyed." Although individuals do acknowledge the importance of planning for retirement, only 2% feel they are saving enough.

Furthermore, the Japanese are more pessimistic about their retirement years compared to other countries. While 72% of respondents in all other countries studied expect future generations of retirees to be "worse off" than current retirees, Japan tops that sentiment at 80%.

Other key findings:

  • 62% of Japanese employees strongly agreed with the statement that the value of their future state pension benefits is likely to be reduced as a result of the financial crisis.
  • Japanese are more flexible about their retirement and are less "wedded" to current retirement ages than other countries studied. While 43% of all respondents think the current retirement age should remain unchanged, only 13% of Japanese respondents agree with them.
  • Respondents do not equate retirement with stopping working altogether, with many seeking other jobs after their official retirement.