Seizing the Global HNW Pension Opportunity

Table of Contents

1. EXECUTIVE SUMMARY

1.1. Market summary

1.2. Key findings

1.3. Critical success factors

2. SIZING THE HNWPENSION OPPORTUNITY

2.1. The

5.2 million HNW investors who are of retirement age present a lucrative opportunity

2.1.1. Many HNW investors already have access to their pension assets

2.1.2. The opportunity is not spread equally across the globe

2.2. 31.6% of HNW individuals will be of retirement age within the next 10 years

2.2.1. 3.9 million HNW individuals will gain access to their pension assets within the next 10 years

2.2.2. Offering pension advice is critical in China due to the massive pre-retirement demographic

3. HNW PENSION PLANNING DEMAND AND PROVISION

3.1. Offering pension advice is critical as more players enter the market

3.1.1. 65% of wealth managers in the HNW space offer pension and retirement planning, but many do so via partnerships

3.1.2. New entrants pose an additional threat to assets under management

3.2. Demand for pension planning services varies considerably across countries

3.2.1. A lack of trust in the government and the economy underpins HNW demand for international pensions in South Africa

3.2.2. German HNW investors regard pension planning as an integral part of the wealth planning process as they believe theRiester and Rüruppensions to be insufficient

3.2.3. The prevalence of SMSFs provides a significant opportunity in Australia

3.2.4. The sizable number of HNW expats living in the Philippines will appreciate international pension advice

3.2.5. Pension advice in the HNW space cannot ignore the sizable entrepreneur segment

4. HNW PENSION INVESTMENT DRIVERS

4.1. Convenience and tax considerations are driving demand for pension products

4.2. Tax considerations are the number one driver for pension advice

4.2.1. Pension, tax, and inheritance planning go hand in hand

4.2.2. Passing on wealth in a tax-efficient way is also a driver in countries with no inheritance taxes

4.2.3. Tax advantages for current income are critical in high-tax France

4.3. The convenience of a readymade pension portfolio represents a strong draw for HNW investors

4.3.1. However, one strategy does not fit all

4.3.2. Chinese providers looking to attract pension assets need to focus on the convenience aspect

4.4. Other drivers include compulsory contributions, advisor recommendations, and low costs

4.4.1. The comparatively low importance of compulsory contributions as a pension driver suggests that HNW pension allocations significantly exceed the required minimum

4.4.2. HNW investors do not tend to rely on advisors for pension advice

4.4.3. Lower costsare only a minor driver, butthe emergence of new business models will apply cost pressures

5. GLOBAL PRIVATE PENSION PENETRATION

5.1. Private pension product penetration rises with level of affluence

5.1.1. 67.6% of mass affluent individuals hold private pension products

5.1.2. Private pension penetration peaks among Generation X, but millennials represent the next big opportunity

6. APPENDIX