Revealed: How much UAE expats save for retirement

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Revealed: How much UAE expats save for retirement

Less than half are currently saving regularly for their retirement, the study suggests.

By Staff Report

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Published: Mon 25 Mar 2019, 3:30 PM

Last updated: Mon 25 Mar 2019, 11:51 PM

Majority of UAE expatriates do not have realistic plans for securing a comfortable lifestyle when they finish working, according to a survey by Friends Provident International and YouGov released on Monday.  
While the research shows that overall more than one-third of respondents (34 per cent) expect to be retired by the time they reach the age of 55, and more than half (53 per cent) before they are 60; less than half (48 per cent) are currently saving regularly for their retirement. 
Furthermore, only one-third of respondents have an investment portfolio set aside to provide an income in retirement. Of the respondents that said they have a retirement portfolio, half (53 per cent) claimed the value of their investments was less than $50,000 and three-quarters (76 per cent) said the value was less than $100,000. 
When asked where they expect to retire, 81 per cent said they would return to their home country and the remainder to another country. Australia, Canada, New Zealand and the UAE were cited as the most popular retirement destinations for those not intending to return home. 
Less than one-third (32 per cent) of respondents said they are entitled to a state pension in their home country - a further 16 per cent were not sure they would qualify, and 52 per cent said they will not be entitled to a pension when they retire.
Chris Divito, managing director Middle East and Africa at FPI, said, it is concerning that while 75 per cent of respondents expect to be retired by the time they are 65, less than half are currently saving regularly for their retirement.  
"Of the people that are saving regularly, only one third are putting aside up to 10 per cent of their monthly income. Perhaps even more worryingly, 58 per cent of people only intend saving for up to 10 years before they retire. That is unlikely to give them enough time to build a retirement fund that is sufficient to sustain them in what should be their golden years," Divito said. 
Based on FPI research, many expats in the UAE are going to fall some way short of achieving the comfortable retirement plans. 
In terms of the monthly income, respondents are targeting post-retirement, overall, three quarters (74 per cent) said they are looking to secure an income of between $1,000 and $4,000 per month (half said they were targeting an income of between $1,000 and $2,000 per month and a quarter [24 per cent] said between $3,000 and $4,000 per month).  
When asked who they approach for financial advice just 12 per cent of respondents said they used the services of a financial adviser, while three times as many (35 per cent) turn to friends and family. A quarter said they do their own research and financial planning online.

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