2024 Global Retail Investor Outlook 2025

Cost-of-living crisis linked to steep inflationary cycles elevates pressure on everyday financial expensesIncreases in costs of living linked to inflation put pressure on everyday household expenses, rather than long-term wealth accumulation targets (e.g. saving for retirement). of renters in the US are cost-burdened (spending more than 30% on housing costs),34 and 9% of those in EU spend more than 40% on housing costs – an increase from 2021.35of individuals state "having enough money for an emergency" as a key financial objective, and 43% indicate “saving for leisure/travel” as as a key financial objective. of individuals expect to achieve their financial objectives within five years; approximately one out of four respondents within a year.50% 60%50%Individuals often align their saving and investment choices to short-term goals, adopting time horizons that are not always conducive to building long-term financial well-being. Policy and product design can help guide investors towards success. Policy and product design features can help retail investors align with long-term goals by building confidence and encouraging stable strategies. Frequent contributions, capital protection and volatility hedges help build investor confidence by ensuring more stable and predictable returns. 44% of investors would feel more confident investing with more return guarantees.Tax advantages and employer-backed financial wellness programmes can encourage long-term investing by making participation more accessible and financially beneficial for employees. 40% of non-investors would consider investing more if they received tax incentives. 68% of employees opt into financial wellness plans when offered by their employer.29 Structured investment programmes from an early age and well-designed retirement plans support long-term wealth accumulation and financial security. Approximately 75% coverage for OECD countries with quasi/mandatory pension plans.30 Optional contributions to super-annuation scheme Australia’s superannuation pension plans register (on average) 70% higher than mandatory contribution rates, with investors taking advantage of optional contribution tools offered (e.g. concessional, spouse).31 NISA incentivized investment schemes Around 20 million NISA accounts have been opened, with capital gains tax exemptions on contributions encouraging market participation and long-term investing, reducing reliance on state pensions amid Japan’s ageing population.32 Auto-enrolment for pension gap challenges Auto-enrolment in the UK has led to pension coverage rate jump from 45% to 80%, yet 40% of the population is still expected to be unable to appropriately substitute income upon retirement.33 2024 Global Retail Investor Outlook 35