Retirement preparation in the Philippines is not rated as optimal, said Insular Life Assurance Co. Ltd. (InLife), based on a survey of 1,000 adults.
“We want a high score because the score tells us how prepared we are as a nation,” Gay L. Martinez, chief marketing officer and chief bancassurance officer for InLife, said at a briefing Tuesday.
The Philippines was rated 47 on a scale of 100 on InLife's Retirement Index, which the company said was in the moderate range but far from optimal.
Survey respondents ranged in age from 18 to 59 across various income groups.
Jose Eduardo O., Chief Product and Innovation Officer, InLife. “47 is on the low side, so there is definitely a lot of room for improvement in the preparation of Filipinos,” Ang said.
InLife Business Insight and Community Management Head Abigail A. Magtibay said, “Many Filipinos only start thinking seriously about retirement when there are changes in their lives. So, if they get married, they have children. It's often reactive. We don't have a proactive mindset when it comes to retirement.”
“For the average Filipino, there is still a tendency (to keep money) in savings or digital wallets, but what would be good to enhance our retirement preparedness would be to diversify into other financial instruments. We also pay attention to insurance ownership. InLife policy holders scored 62 points compared to their counterparts who do not have an InLife policy, who scored 42 points,” he said.
He said, “Filipinos who feel excited about retirement and have positive sentiment toward retirement will score significantly higher on the index. Conversely, those who are indifferent or anxious will delay planning. Of course, this will mean a lower score.”
“The index also shows that social support is a key driver. People who regularly discuss retirement with their family, their friends or financial advisors will score higher because they are more prepared,” he said.
Ms Magtibay said coverage under the social security system and government service insurance system is inadequate, especially for people in informal employment.
“Many Filipinos, especially those in the freelance or gig economy or informal employment, do not have any employer-provided pension plans and have limited awareness of their rights. The index shows that pension participation contributes significantly to retirement preparation. On the other hand, those who have employer-provided pension plans will show higher preparedness,” he said. , Aaron Michael C. Cy
