Scottish Widows’ latest Retirement Report reveals that over a third of South Asian communities in the UK are on track for a comfortable retirement.
As the UK celebrates South Asian Heritage Month (running from 18th July – 17th August), the latest figures from Scottish Widows' annual study of the nation’s retirement preparations provide some cause for optimism, particularly for Indian communities.
However, despite this, the report uncovers disparities in retirement planning across South Asian communities. Only 35% of respondents in the Pakistani community and 39% of those in other Asian communities are currently on track for a comfortable retirement lifestyle. These figures are broadly consistent with those of White British (36%), White non-British (30%), and Black (35%) communities.
The Indian community has a positive outlook on retirement which can be attributed to several factors, including higher levels of non-pension savings, a greater likelihood of being married or in a civil partnership, an expectation of partner contributions to retirement incomes, and lower levels of debt compared to other underrepresented communities.
Ranila Ravi-Burslem, Intermediary Distribution Director at Scottish Widows, spoke exclusively to Asian Voice about this.
1. What is the importance of positive outcomes in the South Asian community amid ongoing debates on racism and less inclusion?
Positive outcomes in the South Asian community are important for several reasons. First, they can help to challenge the stereotypes and prejudices that those in the community face from racism and discrimination. Second, they can empower those within the South Asian community to overcome the barriers and challenges they face in accessing education, employment, health care and other opportunities. Also, the positive outcomes can highlight the contributions that the South Asian community make to wider society and the economy in various fields and sectors. By celebrating and promoting positive outcomes in the South Asian community, we can foster a more inclusive and diverse society.
2. What can be done to improve outcomes in the Bangladeshi and Pakistani communities?
To increase incomes for Pakistani and Bangladeshi communities, there needs to be more investment and intervention in tackling the systemic barriers and root causes of inequality, such as workplace discrimination, racism and classism.
The data from the Office of National Statistics reveals the disparities in earnings of those within the Bangladeshi and Pakistani communities, earning 16.9% and 20.2% less than their white counterparts. This highlights the need for employers to report on ethnicity pay gaps and take action to address any barriers or biases in the workplace that affect access to employment, quality training, and career progression. Additionally, supporting South Asian community-led initiatives and organisations that promote social cohesion, civic engagement and cultural awareness, and celebrating the achievements and contributions of Bangladeshi and Pakistani individuals and groups in various fields are also important steps to improve outcomes.
3. Why do you think Indians fare better?
The Indian community has a positive outlook on retirement which can be attributed to several factors. These include higher levels of non-pension savings, a greater likelihood of being married or in a civil partnership, an expectation of partner contributions to retirement incomes (85% compared to 50% for those in the White British community), and lower levels of debt compared to the national average. Educational attainment Is a very important factor too. Most people from Indian communities are university educated and therefore are In higher-earning jobs leading to better financial resilience and the ability to save more for retirement.
4. How can there be more parity within the South Asian community, when it comes to retirement planning?
To achieve parity within the South Asian community, when it comes to retirement well-being, there needs to be more awareness and education about the benefits and options of pensions. There also needs to be more grassroots work within South Asian communities to support and guide those who struggle to access or contribute to pension schemes, such as low-income earners, self-employed workers, carers and women, who often face barriers and challenges, such as lower pay, higher unemployment, discrimination, caring responsibilities and cultural norms. Research has shown that women born in Pakistani and other South Asian communities were more likely to work in involuntary part-time jobs because they could not find full-time positions compared to women born in the UK. This may be due to various reasons such as discrimination, language barriers or family responsibilities.
In addition, employers and policymakers need to continue to do their part in making sure workplace pension schemes and auto-enrolment is accessible for all, which can help to secure a comfortable retirement. For example, the NHS, which employs a large proportion of South Asian workers, has recently introduced a new pension scheme that offers more flexibility and choice for staff allowing them to choose their contribution rate, opt for a lump sum or an income at retirement and access their pension benefits earlier or later than the normal pension age. Also, MPs have backed a private members’ bill that would reduce the pensions auto-enrolment age from 22 to 18 and abolish the lower earnings limit, which the government has said would encourage employees to start saving for their retirement earlier in their careers.
5. Do you think in today's world, people need to have a post-retirement plan that safeguards them monetarily and emotionally?
Definitely, I think people need to have a post-retirement plan. When we think about the cost of living and inflation coupled with the lack of wealth in underrepresented communities, this will have an impact on the ability to afford basic needs or desired comforts. Also, as life expectancy, medicine and health care advance, we need to save more for a longer retirement period. For example, in my case, I will be looking to move to a warmer climate due to my arthritis, so I will take steps to ensure that this is possible Emotionally, it’s likely you’ll want to be with friends and family and this may require moving or travelling often. Therefore, having a plan will support ensuring a comfortable and fulfilling retirement.
