Asian Retirees Asset Rich, Income Poor


    Households in Hong Kong, Japan, Singapore, South Korea, and Taiwan have relatively high levels of accumulated wealth and more efficiently mobilizing these assets could significantly supplement other sources of retirement income, says ‘Asset rich, income poor? Key components of retirement income security for aging Asia,’ a report by Manulife Asset Management. The report examines the economies of these five countries which are in the advanced stages of their demographic dividends and have accumulated considerable levels of household wealth. While these levels of wealth suggest that constituent households should be able to retire with a high degree of income security, evidence indicates that many are actually entering retirement asset rich, but income poor. Michael Dommermuth, president of international asset management, Manulife Asset Management Asia, says “While the market tends to focus on the accumulation phase of preparing for retirement, we believe that it is just as important to be mindful of the de-cumulation phase. Our analysis reveals that all five economies have relatively bright prospects for improving retirement income security within the structures of existing policies, programs and practices. For example, generally high levels of household wealth can be more efficiently mobilized by diverting cash holdings into equity, fixed income, or asset allocation products, many of which are income generating.”