A new global survey of retiree well-being paints a bleak picture for Americans hoping for an old age free of financial stress. A separate report on the impact of global warming makes it even worse.
The 2019 Global Retirement Index released Thursday by Natixis Investment Managers cites a trifecta of risks for retirees, policymakers and long-term global sustainability: low interest rates, longer lifespans and the high costs of climate change.
The constant struggle to get by on a fixed income is likely pushing down the U.S. score in one of four broad categories the index measures: material well-being. The U.S. scored 58% overall, down from last year’s 61%, and dropped two spots in the overall country ranking, to No. 18. The nation’s low rank for income equality (37th worst of 44 countries) is partially to blame.
With income streams low, retirees may move into riskier assets in a bid to make up for a shortfall in income. “Many retirees may not have the time they need to recoup any losses due to a market downturn,” the report by Natxis noted.
Health care is often one of the largest expenses for American retirees. A new study by the Natural Resources Defense Council, an environmental advocacy group, and the University of California, San Francisco calculated that 10 climate-sensitive events in 2012—such as wildfires, extreme heat and Hurricane Sandy—played an outsized role in this dynamic, leading to more than $10 billion in health-related costs.
{{/usCountry}}Health care is often one of the largest expenses for American retirees. A new study by the Natural Resources Defense Council, an environmental advocacy group, and the University of California, San Francisco calculated that 10 climate-sensitive events in 2012—such as wildfires, extreme heat and Hurricane Sandy—played an outsized role in this dynamic, leading to more than $10 billion in health-related costs.
{{/usCountry}}Severe weather that forces retirees to relocate, even temporarily, can be very disruptive for someone living on a fixed income, said Ed Farrington, executive vice president of Retirement Strategies at Natixis. The group’s report stated that “retirees are finding insurance costs escalating as insurers seek to keep pace with climate and weather-related property damage.”
There are a few glimmers of hope, however. A separate Natixis survey found that 64% of millennials actively seek investments aligned with their values, compared with 43% of baby boomers, and that 59% want to make a positive social or environmental impact when they invest, versus 48% for boomers. Such numbers may encourage more opportunities to put money in planet-saving investments.
“You get the economy you invest in,” said Garvin Jabusch, co-founder of Green Alpha Investors.
(This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.)
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