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RETIREMENT PLANNING

RETIREMENT PLANNING. Why, When and some things to Consider……. The jamaican landscape. Some Fun Facts. Total Population 2,700,000 Working Population 1,260,000 Life Expectancy Now IF JUST BORN 73.0 Years IF AGE 65 83.0 Years Private Sector Pension Planners 80,000

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RETIREMENT PLANNING

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  1. RETIREMENT PLANNING Why, When and some things to Consider……

  2. The jamaican landscape

  3. Some Fun Facts Total Population 2,700,000 Working Population 1,260,000 Life Expectancy Now IF JUST BORN 73.0 Years IF AGE 65 83.0 Years Private Sector Pension Planners 80,000 Public Sector Pension Planners 240,000

  4. Jamaica’s Population Growth

  5. Trends • Aging Populations • Increasing Life Expectancy • Challenging Economic Backdrop

  6. Aging Populations

  7. Aging Populations

  8. Increasing Life Expectancy

  9. Increasing Life expectancy

  10. Economic Backdrop • Inflation and worse…medical inflation • Savings and interest on savings…JDX • Limited access to public health care • Shifting social practices and expectations • Weak social safety nets

  11. Inflation and Worse….Medical Inflation

  12. Savings, Interest and JDX Fall in interest rates of 4.5% STRAIN ON PENSIONERS RELYING ON INTEREST FOR INCOME Reduced the life time of pensioners savings SAVINGS PUT ASIDE FOR RETIREMENT NOW WILL NOT LAST AS LONG 30% fall in retirement income that can be supported by workers pension savings for annuities THE AMOUNT REQUIRED TO SUPPORT $100 OF RETIREMENT INCOME CAN NOW ONLY SUPPORT $70

  13. Limited Access to Public Health Care • Translation ….expensive private care • Drug supplies relatively well supported through JADEP and NHF • Hospital care is not well supported • Elective care means long waiting lists • Emergency care relies on availability of hospital facilities

  14. Shifting social practices and expectations…… • Relying on children is a thing of the past…often not living in same country • Shifting from extended family arrangement to institutional arrangements • Growing need for affordable living options

  15. Weaker Social Safety Nets • Weak economy vulnerable to shocks leaving limited funds for social protections • Worsened by aging populations • Higher demand for medical • Less working population to provide support

  16. Retirement Planning …..in the new reality

  17. Don’t panic …..now you know what you are up against and so you know what to prepare for

  18. What do you need to consider…. • How long you can or want to work to generate income • Lifestyle and quality of life as you age • Having a lifetime income • Protection against inflation • Emergency savings • Health coverage and wellness • Alternative living arrangements if healthy or if in need of assisted living

  19. How do you see yourself living….. DO Identify your plans during your retirement DO NOT Isolate yourself without occupation

  20. Lifetime Income DO Purchase lifetime income protection DO NOT leave lifetime income protection to chance

  21. Protection against inflation… DO Find ways to hedge against inflation DO NOT Forget that purchasing power erodes with time

  22. Emergency Savings • Reduce your obligations to the minimum as you move to retirement • Maximize your savings and tax efficiencies • Starting early allows for more interest build up….but…it is never too late….savings provide a cushion • Make room for savings set backs

  23. Benefits of starting early

  24. Health Insurance and Health DO Keep healthy DO NOT Wait to secure health insurance coverage

  25. Living arrangements DO Match your housing to your needs and means DO NOT Keep a big house just for sentiment

  26. In closing….. • Living in an age of uncertainty • Changing and unpredictable landscape • Planning and minimizing uncertainty in retirement key • If you have not already started planning….. start NOW

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