27 Mar BlackRock chief warns a looming crisis over pensions
The world faces a looming “retirement crisis” that requires a rething of pensions and working patterns as medical breakthroughs boost longevity.
ㄴ Larry Fink: BlackRock’s chief executive
Fink, whose previous missives have helped boost interest in stakeholder capitalism and climate change, cited UN projections that one in six people globally would be older than 65 by 2050, up from one in 11 in 2019, as he called for increasing lgobal use of capital markets to help worker save for old age.
He warned that the rise of defined contribution prension plans had combined with the growing strain on the social security government retirement programme to leave the Us particularly unprepared for a huge increase in the retiree population.
Flink described the mismatch abetween what Americans were saving and what they would need as “a problem so big and urgent that government and corporate leaders ned to stop business as usual and step out of their silos and sit around the same table to find a solution”
More than half of BlackRock’s $10tn in assets under management are retirement savings, including institutional pension funds, corporate defined contribution plans known as 401(k)s and individual accounts.
Fink’s focus on retirement came alongside an effort to stake out a middle groud in the political wars over sustainable investing, an approach he called “energy pragmatism”
Fink wrote that global politicians and businesspeople increasingly planned to invest in both oil and gas for energy security and green power for energy transition.
The US Congress has passed two reform packages in the past five years aimed at making 401(k) and other retirement plans more comprehensive and effective.
Others highlighted a $4tn gap between what Americnas need for old and and what they have saved. She says all companies should be required to enrol workers in a savings plan that will create substantial pension pot, rather than leaving it up to them to opt in.
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