There are a few lucky people who do not have to worry about saving for retirement. They have sufficient money that they can choose to stop working anytime and never worry about money. However, for most of us, it is important to invest and save wisely for retirement.
Researchers recently decided to see how much people in the U.S. and 15 other countries knew about investing properly for their retirements. The results were not encouraging, as Bloomberg reports in "The World Isn't Prepared for Retirement." Over half of the Americans surveyed, did not know that it is better to invest in a mutual fund than in a single company's stock. Americans also lacked a basic understanding of the impact of inflation.
In addition to financial illiteracy, other important knowledge gaps were noted. Many respondents did not seem to recognize the major impact that basic changes in the labor force, technology and the climate could have on their retirement plans. The global trend that worried individuals most was the reduction of government benefits. While this is certainly a threat, other factors such as globalization and the loss of jobs to automation were widely underestimated.
Interestingly, Americans were also hesitant to identify some of the positive uses for robotic technology. For instance, only 6% agreed with the idea that they might have a robot to help them in their older age.
Understanding global economic trends and basic financial concepts are important to adequately preparing for longevity. As a society we have some work to do.