Baby boomers not ready to retire

Korea’s baby boomers barely eked out a passing grade in terms of whether they are ready to retire, according to a new index unveiled yesterday that rated over 3,700 citizens born in the decade after the Korean War on how prepared they are financially and psychologically for the move.

In the underlying study, Korean citizens between the ages of 47 and 55 who are facing retirement were found to be generally unprepared in both categories, rating as low as 52.6 points out of 100 in one category.

However, in terms of health or social engagements, such as being prepared to spend more time with family and friends, Korean baby boomers were found to be slightly better equipped.

Yesterday, the Seoul National University Institute on Aging and MetLife Korea joined together to introduce a multi-faceted retirement readiness index. This was extrapolated from a survey of 3,783 baby boomers born between 1955 and 1963. The respondents were from the same pool as a similar study conducted two years ago by the SNU Institute on Aging, with the exception of those that had already retired or had never been employed.

According to the latest study, Korea’s baby boomers scored an average of 62.22, barely avoiding an “F” grade. They rated the lowest in terms of financial readiness, with an average of 52.6 points, and also scored poorly in psychological readiness with 61.3 points.

Soon-to-be-retired Koreans fared better in terms of social relationships and health, scoring 66.36 points and 68.62 points, respectively.

The scores were assigned by questions that isolated the respondents’ current status, their pool of resources, and what actions they are taking to prepare for their retirement. For example, under psychological readiness, the study asked questions about their current level of happiness, their ability to cope with feeling out of control, and their level of self-acceptance.

“The conclusions reached in the study may long have held true for baby boomers, but there were not previously any indices that fully reflected all the different aspects of that reality,” said Han Gyoung-hae, a professor at the Seoul National University Institute on Aging, which led the research.

“Existing indices tended to focus only on financial aspects, and it has only been a few years since people began talking about the non-financial aspects of getting ready to retire and their importance in Korea.”

The institute plans to report the findings to a meeting of the Gerontological Society of America this year, reflecting growing interest in tracking the effects of retirement as they impact one of the fastest-aging societies in the world.

With more such studies slated to be conducted every two years with the backing of MetLife Korea, Han said she hopes to delve deeper into the minute trends of people’s lives after they stop working.

“By fine-tuning the findings to fit smaller and smaller trends, as well as tracking the same pool of baby boomers throughout different stages of their retirement, I believe it will be possible to both validate our findings through what’s really happening and identify a greater variation of baby boomers’ needs,” said Han.

By Lee Jung-yoon [joyce@joongang.co.kr]