A new survey has found that most expats living in the United Arab Emirates (UAE) are not saving enough to live comfortably once they retire.
A report carried out by Friends Provident International and YouGov found that fewer than half of expats living in the UAE are regularly putting money aside for their retirement. This is despite the fact that more than one third of the survey’s 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.
What’s more, only one-third of respondents have an investment portfolio set aside to provide an income during their retirement years. Of the respondents that said they do have a retirement portfolio, around half (53 per cent) claimed the value of their investments was less than US$50,000 (approximately £38,000) and three-quarters (76 per cent) said the value was less than US$100,000 (approx. £76,000).
Chris Divito, managing director Middle East and Africa at Friends Provident International, 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,” he said. “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,” he added.
The survey also found that the large majority of UAE-based expats do not expect to stay in the Emirates once they retire. A whopping 81 per cent stated that they would either look to return to their ‘home’ country once they stop working, or look to move to another one. Australia, Canada and New Zealand were the most popular retirement destinations for those looking to leave the UAE but not wanting to return ‘home’.
Based on the FPI research, many expats in the UAE are going to fall some way short of achieving their comfortable retirement plans.
In terms of the monthly income that the survey’s respondents are targeting post-retirement, three quarters said they are looking to secure an income of between US$1,000 and US$4,000 per month.
When asked who they approach for financial advice, only 12 per cent 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.
Article published 27th March 2019