Retirement index shows Filipinos lag in future preparedness

New index reveals gaps in Filipinos’ preparedness for life after work

Filipinos may pride themselves on caring for aging parents, yet when it comes to preparing for their own senior years, they fall short. A new retirement index shows the country’s readiness remains “far from ideal,” revealing a cultural gap between family-oriented values and financial planning habits.

The inaugural Retirement Index by Insular Life Assurance Co. Ltd. (InLife) found that Filipinos scored just 47 out of 100 in overall readiness—evidence that cultural priorities and economic pressures still outweigh financial planning.

Only 24 percent of Filipinos currently have a concrete retirement plan, according to InLife’s data.

A new metric for readiness

The index, said to be the first of its kind in the country, surveyed 1,000 Filipinos aged 18 to 59 across income levels. It evaluated not just financial capability but also factors such as health, pension participation, and social support—expanding the idea of retirement beyond pure wealth accumulation. 

According to Abigail Magtibay, InLife’s head of business insights and community management, many Filipinos tend to plan reactively.

“Many Filipinos only begin to seriously think of retirement when there are changes in their life. It’s often reactive. Unfortunately, many people do not have a proactive mindset in terms of retirement,” Magtibay told radar Business.

Older Filipinos, with more stable income and assets, scored better at 54, while Gen Z respondents lagged behind at 36—reflecting limited earnings and short-term financial habits despite higher insurance awareness. 

“Social support is a key driver. People who regularly discuss retirement with their family, friends, or financial advisors would score higher because they are more prepared,” she said. 

Financial strain, changing work patterns

Industry observers note that the rise of freelance and gig work, coupled with stagnant wages, has widened the retirement gap. Many workers operate outside traditional employment structures, leaving them without access to formal pension systems or employer contributions.

Even with government programs like the Social Security System (SSS) and Government Service Insurance System (GSIS), experts warn that benefits may not be enough to sustain retirement needs amid inflation and longer lifespans.

InLife’s Gae Martinez said insurance plays a critical role in bridging that gap.

“Insurance addresses two major risks: dying too soon and living too long,” she said, pointing to new products such as Retire Assure 2, designed to help Filipinos build passive income and diversify assets beyond savings accounts and e-wallets.

With only 24 percent of Filipinos having a proper retirement plan, an urgent need to secure the population’s future is imminent, the firm said. For those who begin planning early, it’s essential to diversify their assets across different financial instruments.

A wider insurance picture

The insurance industry is entering a new growth phase as companies pivot toward financial inclusion and long-term planning tools. In the Philippines, insurance penetration rose to 1.89% in the first quarter of 2025, up from 1.78% a year earlier, according to the Insurance Commission.

However, the OECD notes that the country still faces one of Asia’s widest “retirement protection gaps,” meaning that personal savings and private insurance fall short of what retirees need to maintain living standards.

Retirement as a long-term goal

The company said the index is intended not just as a marketing tool but as a wake-up call to improve financial literacy and promote proactive planning. Insights from the index are also expected to be used to strengthen public education campaigns and develop flexible savings models suited to younger, informal, and digital-first workers.

Magtibay added that discussions around retirement are still limited in Filipino households, yet people who talk about it regularly with family or advisors score higher in preparedness.

Martinez said, “Retirement should not just be viewed as a financial milestone. It’s an emotional, social, and even cultural journey that demands awareness, attention, and consistency.”

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