27 June 2012

Secure old age in Russia? Don't make me laugh!

How to save up for old age
Education, health and children are the best retirement investmentsRoman Markelov, Rossiyskaya Gazeta

Only one in twenty-fifth Russians counts on financial assistance from their own children after retirement.

Basically, people prefer to save themselves.

Such data is provided by the research holding "Romir" in its report. Analysts conducted a sociological survey among Russian citizens aged 16 to 50 years and older.

Quite a large part of the population, as it turned out, professes the principle of "help yourself" and saves for old age in cash or opens a bank account. There were 43 percent of such respondents. In turn, 12 percent of respondents were more sophisticated in choosing investments for old age and prefer real estate, expensive purchases and other assets, according to the Romira study. Another 12 percent use the services of a non-state pension fund, and 5 percent of citizens have issued a life insurance policy. At the same time, every fourth respondent stated that he does not create his own "airbag" for old age at all.

"The percentage of people investing in real estate very clearly shows the real number of people who can afford it," says Dmitry Miroshnichenko, a researcher at the Development Center of the Higher School of Economics. But, according to him, investing in an apartment or a house in general is a pretty good solution. Only one thing is unclear – what will happen to real estate prices in Russia in thirty years or so.

"But saving for old age with cash or deposits in a bank means losing to inflation," the analyst continues. In his opinion, pension funds and life insurance policies are fraught with a lot of risks. "A lot here depends not on the person himself, but rather on the qualifications of managers and in general on whether the company will survive until the depositor retires," says Miroshnichenko.

According to the analyst, it is almost impossible to find financial instruments in Russia today that would definitely guarantee a comfortable old age for a person. "The planning horizon is very large here. Therefore, I would advise investing in yourself, especially while you are young," Miroshnichenko notes. For example, you should start with your own education and health. "The first will allow you to earn money, the second will prolong the active phase of life," explains the expert of RG.

There is, however, another form of investment, which, according to Romir, only four percent of Russians hope for. "This is an investment in children who could feed you in old age. The millennial world practice has shown the effectiveness of such an investment," Miroshnichenko said.

In total, the experts of "Romir" calculated that 60 percent of Russians think about what they will live on in retirement anyway. According to our expert, it's never too early to think about it. "And you have to start at the age of thirty," Miroshnichenko summed up.

Portal "Eternal youth" http://vechnayamolodost.ru27.06.2012

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