By Lawrence Bartlett | October 30, 2008
DREAMS of a life of ease and luxury over a long retirement have been shattered for many ageing baby-boomers around the world as the global economic meltdown shrinks their savings.
In Australia, a billion dollars a day was wiped off the nation's retirement funds in the past four months as stock markets plunged on fears of a global recession.
"If people panic and get out, they will lose their money forever,'' warned the Association of Superannuation Funds chief executive Pauline Vamos.
That is not the sort of future envisaged during the boom years as compulsory contributions by employers and employees produced double-digit returns -- and fed the dreams that went with them.
"It's a culture shock,'' KPMG demographer and author Bernard Salt told AFP.
"Baby-boomers could well morph into the disappointed generation when they get to retirement.
"They've had, with a few exceptions, 30 years in prosperity and maybe this is their time of adversity that arrives the moment they are ready to retire.
"Working hard, paying taxes, saving money for their retirement -- they get to retirement and their nest egg is cut in half.''
Mr Salt said that while the average retirement age in Australia was 58, "an event such as this will encourage people to work longer -- they'll say 'I need to wait until the storm has passed'.''
In the United States, workers are also having to put off their plans for retirement as the global economic slump affects their savings and the cost of living climbs.
At least seven in 10 Americans older than 45 expect they will have to continue to work beyond 65, the usual age of retirement, according to a study by the AARP, a huge lobbying and interest group for people over 50.
"Baby-boomers particularly are finding that they need to delay their retirement or come out of retirement to come back to work, in large part because of the decline in their assets,'' said Tim Driver, director of Retirementjobs.com, which helps retirees find a job.
In Singapore, a 65-year-old retiree at a rally at Speakers' Corner last weekend, said he might have to find a part-time job to support himself and his wife.
The former mid-level company manager stands to lose $S200,000 ($199,360) of his retirement funds invested in a product linked to the collapsed US investment bank Lehman Brothers.
"I have stopped playing golf. I cannot focus on my game,'' he said at the free-speech corner. "If I don't get anything back, I will have get out of retirement and find a part-time job.''
Disgruntled investors have been holding weekend gatherings at Singapore's Speakers' Corner since October 11 to demand financial institutions give back their investments.
In Malaysia, "it is a very bleak situation for many elderly investors'' whose funds had lost more than half their value, said Patrick Lim, president of the Malaysian Investors' Association.
"As Malaysia is not a welfare state, these retirees have no access to any additional funds so they will have to go out and try to find a job but no one wants to hire old people,'' he said.
Albert Ho, a lawmaker on the welfare services panel of Hong Kong's legislature, said he was handling a lot of cases involving retirees losing their life savings to stocks or high-risk financial investment products.
"Some retirees wanted to find a job to support themselves. But the poor economy now makes it tremendously difficult for them to re-enter the job market,'' he said.
"We are thinking about ways to help them reintegrate into the market, by offering them jobs which do not require a lot of physical work. But we haven't come up with any concrete proposal yet.''
However, the boom years cushioned some against hard times, and the faces of the retirees at the Manly bowling club in Sydney one recent spring morning did not reflect the trauma expected to accompany disappearing billions.
Their equanimity seemed to suggest instead that to the inevitability of death and taxes has been added one more certainty - market meltdowns. Followed, they hope, by market rebounds.
"We base our hope on history,'' said a former teacher who wanted to be identified only as Dave, 59.
"Things will get better. The market will rise again.
"I lost about 50 per cent of my super, but I am alive and the sea is warming up and I am spending with circumspection.''
Nick Vatoff, 81, formerly a builder, put the figures into perspective.
"I lost more than $200,000 , some on the stock market, some in my retirement fund but I can still be okay if it doesn't go any further,'' he said.
John Ballantyne, 65, who retired on his investments after a lifetime in the livestock industry, said he had also lost heavily and would have to cut down on some luxuries.
"My wife and I have done a lot of travelling abroad, but we'll now have to restrict our travel, we'll tighten the belt,'' he said.
But Manly, like other beachside suburbs, is home to some of the wealthier inhabitants of Australia's biggest city and in other parts of the country many ageing workers face the same fate as their counterparts in the US.
A study earlier this month found that a quarter of people approaching retirement age now expected to have to work until their 70s because their pension funds were shrinking.
DREAMS of a life of ease and luxury over a long retirement have been shattered for many ageing baby-boomers around the world as the global economic meltdown shrinks their savings.
In Australia, a billion dollars a day was wiped off the nation's retirement funds in the past four months as stock markets plunged on fears of a global recession.
"If people panic and get out, they will lose their money forever,'' warned the Association of Superannuation Funds chief executive Pauline Vamos.
That is not the sort of future envisaged during the boom years as compulsory contributions by employers and employees produced double-digit returns -- and fed the dreams that went with them.
"It's a culture shock,'' KPMG demographer and author Bernard Salt told AFP.
"Baby-boomers could well morph into the disappointed generation when they get to retirement.
"They've had, with a few exceptions, 30 years in prosperity and maybe this is their time of adversity that arrives the moment they are ready to retire.
"Working hard, paying taxes, saving money for their retirement -- they get to retirement and their nest egg is cut in half.''
Mr Salt said that while the average retirement age in Australia was 58, "an event such as this will encourage people to work longer -- they'll say 'I need to wait until the storm has passed'.''
In the United States, workers are also having to put off their plans for retirement as the global economic slump affects their savings and the cost of living climbs.
At least seven in 10 Americans older than 45 expect they will have to continue to work beyond 65, the usual age of retirement, according to a study by the AARP, a huge lobbying and interest group for people over 50.
"Baby-boomers particularly are finding that they need to delay their retirement or come out of retirement to come back to work, in large part because of the decline in their assets,'' said Tim Driver, director of Retirementjobs.com, which helps retirees find a job.
In Singapore, a 65-year-old retiree at a rally at Speakers' Corner last weekend, said he might have to find a part-time job to support himself and his wife.
The former mid-level company manager stands to lose $S200,000 ($199,360) of his retirement funds invested in a product linked to the collapsed US investment bank Lehman Brothers.
"I have stopped playing golf. I cannot focus on my game,'' he said at the free-speech corner. "If I don't get anything back, I will have get out of retirement and find a part-time job.''
Disgruntled investors have been holding weekend gatherings at Singapore's Speakers' Corner since October 11 to demand financial institutions give back their investments.
In Malaysia, "it is a very bleak situation for many elderly investors'' whose funds had lost more than half their value, said Patrick Lim, president of the Malaysian Investors' Association.
"As Malaysia is not a welfare state, these retirees have no access to any additional funds so they will have to go out and try to find a job but no one wants to hire old people,'' he said.
Albert Ho, a lawmaker on the welfare services panel of Hong Kong's legislature, said he was handling a lot of cases involving retirees losing their life savings to stocks or high-risk financial investment products.
"Some retirees wanted to find a job to support themselves. But the poor economy now makes it tremendously difficult for them to re-enter the job market,'' he said.
"We are thinking about ways to help them reintegrate into the market, by offering them jobs which do not require a lot of physical work. But we haven't come up with any concrete proposal yet.''
However, the boom years cushioned some against hard times, and the faces of the retirees at the Manly bowling club in Sydney one recent spring morning did not reflect the trauma expected to accompany disappearing billions.
Their equanimity seemed to suggest instead that to the inevitability of death and taxes has been added one more certainty - market meltdowns. Followed, they hope, by market rebounds.
"We base our hope on history,'' said a former teacher who wanted to be identified only as Dave, 59.
"Things will get better. The market will rise again.
"I lost about 50 per cent of my super, but I am alive and the sea is warming up and I am spending with circumspection.''
Nick Vatoff, 81, formerly a builder, put the figures into perspective.
"I lost more than $200,000 , some on the stock market, some in my retirement fund but I can still be okay if it doesn't go any further,'' he said.
John Ballantyne, 65, who retired on his investments after a lifetime in the livestock industry, said he had also lost heavily and would have to cut down on some luxuries.
"My wife and I have done a lot of travelling abroad, but we'll now have to restrict our travel, we'll tighten the belt,'' he said.
But Manly, like other beachside suburbs, is home to some of the wealthier inhabitants of Australia's biggest city and in other parts of the country many ageing workers face the same fate as their counterparts in the US.
A study earlier this month found that a quarter of people approaching retirement age now expected to have to work until their 70s because their pension funds were shrinking.
