The COVID outbreak and its devastating effect on the world economy is expected to have a long-term effect on billions of retirements in the decades to come.
Dr. David Knox, Senior Partner at Mercer Retirement Consulting, told the Financial Times last week that the economic recession brought on by the COVID outbreak “has led to reduced pension contributions, lower returns, and higher government debt in most countries.”
He continued, “Inevitably this will impact future pensions, meaning some people will have to work longer, while others have to settle for a lower standard of living during retirement.”
Last month, pension funds for truckers, teachers, and NYC’s Metropolitan Transportation Authority filed a lawsuit against Allianz, an asset manager, claiming they lost about $4 billion due to the outbreak, Reuters reported. The suit, filed in the U.S. Southern District of New York, claims the German company failed to safeguard assets during the downturn.
The FT reported that even before the outbreak and turbulence in the markets, lingering low-interest rates and an aging population have added strain on the pension system in the U.S. The paper pointed out that some account holders were able to dip into their 401K during the downturn, which could have a long-term effect on retirement goals.
Countries such as Indonesia reduced its social security contribution from 2 percent to 0.2 percent from May to July, the report said.
Hargreaves Lansdown, a British financial company, reported 14 percent of people reduced their pension contribution and 11 percent cut contributions out entirely, according to the Mirror.
TREND FORECAST: As we have been reporting in the Trends Journal since the outbreak of the COVID War, the rich have gotten much richer while the vast majority of the world’s population have gotten much poorer.
With the “Greatest Depression” worsening, artificially pumped up equity markets will crash; nations, states, and cities will default on bonds; and much of the population, especially the elderly, will sink into poverty, unable to afford to even live modestly.
