Over the next few decades, the developed world's population that's over-60 will increase from fewer than one in five to nearly one in three according to World Bank projections. As the population continues to age, the ratio of workers to retirees is falling dramatically. Fewer and fewer contributors are available to meet the needs of a growing group of retired employees.
More people are enjoying longer retirements, thanks to improved life expectancy and the opportunity to retire earlier. This has created an unprecedented demand for pension assets. And that demand has its consequences-challenges as well as opportunities-for every institutional investor and every individual in the world.
For corporations, trade organisations and governments that are responsible for the future well-being of thousands, the impact of aging is felt every day. These institutional investors are responsible not only for the safety of the assets in their care, but achieving the growth necessary to meet future liabilities.
However, the economic pressures on these institutions often means that while demands have increased, resources have not. How well they will be able to meet obligations in the years to come will depend on their ability to shape their environment for success-controlling risk, improving performance and reducing administrative burden.
For mutual funds, investment firms and insurance companies, this trend represents nothing less than an historic opportunity. The flow of retirement assets into investment vehicles is well documented, but the ability to exploit current opportunities is dependent upon how well resources are allocated.
While the population with the highest savings rate (those 40 to 64 years old) is growing, only those investment professionals with capabilities that allow them to pursue growth wherever there is opportunity will be successful. Examples of these opportunities include entering new markets, introducing additional products, and attracting and retaining customers.
At State Street, we never lose sight of our customers' objectives. We work hard to understand their unique situation. And then we put together a plan to help ensure they will be able to meet those goals. Our services and products enable our customers to compete successfully in this demanding environment. We use our cutting edge technology and our global reach to help some of the world's leading
organisations invest more efficiently, control risk and
maximise return.
