“How we prepare for older age in the 21st century is one of our greatest opportunities and most pressing issues. Collective action by individuals, governments, and employers is needed to modernize retirement systems. Empowering and supporting individuals to take greater control over their retirement security is a cornerstone of a new social contract for retirement,” Alex Wynaendts, CEO of Aegon, told attendees at the OECD Forum in Paris.
"We can help billions of people around the world achieve a secure retirement. The sooner we roll up our sleeves and get started, the sooner we can effect positive change."
The annual OECD Forum stimulates discussion and searches for answers to key economic and social challenges facing the world. This 2-day public engagement event gathers high-level government representatives, CEOs, leaders from civil society and trade unions as well as prominent members of academia and media.
Speaking during the panel discussion, Towards a New Societal Contract?, Mr. Wynaendts said that increases in longevity present the human race with the gift of extra time. "This gift requires engaging our imaginations and rethinking our life priorities and continuum, including how much time we spend in the workforce relative to retirement."
Increases in longevity combined with lower birth rates have also created a major societal challenge. Populations in countries around the world are growing older and, as a result, social security and other government benefits are under tremendous financial strain. Reforms are urgently needed and will take time to implement. In the meantime, people cannot afford to delay their retirement preparations.
Mr. Wynaendts highlighted the findings and recommendations of Aegon's new research report, The New Social Contract: Empowering individuals in a transitioning world. The report explores people's retirement preparations including the need to remain in paid employment longer, stay physically and mentally active, maintain good health, and have the ability to remain in their own home and communities throughout their lives. It presents a holistic approach to retirement planning and outlines the Five Fundamentals for Retirement Readiness, which are action steps people can and should be taking right now. The report calls for collective action and provides specific recommendations for governments, employers, industry, and other social partners to begin building a new social contract for retirement.
The New Social Contract: Empowering individuals in a transitioning world is based on the eighth Annual Aegon Retirement Readiness survey of 14,400 workers and 1,600 retired people across 15 countries spanning Europe, the Americas, Asia and Australia. It is a collaboration among Aegon Center for Longevity and Retirement and nonprofits Transamerica Center for Retirement Studies® (TCRS) and Instituto de Longevidade Mongeral Aegon.
The report builds on the 2018 report, The New Social Contract: A blueprint for retirement in the 21st century, which creates a call to action and outlines nine essential design features for modernizing retirement systems based on the premise that everyone should have the opportunity to retire with dignity.