Russia’s financial regulator has predicted the decline of the national pension system as a result of the millennial generation’s preference for instant gratification and the sharing economy.
Russians born between 1980 and 2000 makes up more than half of the country’s working-age population, according to official statistics. Prime Minister Dmitry Medvedev's new cabinet is expected to discuss extending the retirement age in Russia later this month, the RBC business portal reported.
In its 2019-2021 financial market guidelines report published this week, Russia’s Central Bank named millennials’ changing attitude towards savings as a factor that threatened the future of the country’s financial system.
“Despite the Russian youth’s relatively active savings, the majority tends to invest spare money into receiving quality experiences which are not always forward-looking,” the guideline reads.
“This could undermine the sustainability of the existing pension system in the medium term,” the Central Bank said.
The regulator said the youth’s trend toward “Uberization,” or the switch in focus from owning goods to using them temporarily, “could impact the balance of savings in the economy and the population’s strategies for savings.”
“After all, the final value for a consumer in most cases is using, rather than owning,” it explained.
It warned that lack of retirement savings could constrain the younger generation later in life and offered an “automatic registration” pension plan as a solution.
A Message from The Moscow Times:
Dear readers,
We are facing unprecedented challenges. Russia's Prosecutor General's Office has designated The Moscow Times as an "undesirable" organization, criminalizing our work and putting our staff at risk of prosecution. This follows our earlier unjust labeling as a "foreign agent."
These actions are direct attempts to silence independent journalism in Russia. The authorities claim our work "discredits the decisions of the Russian leadership." We see things differently: we strive to provide accurate, unbiased reporting on Russia.
We, the journalists of The Moscow Times, refuse to be silenced. But to continue our work, we need your help.
Your support, no matter how small, makes a world of difference. If you can, please support us monthly starting from just $2. It's quick to set up, and every contribution makes a significant impact.
By supporting The Moscow Times, you're defending open, independent journalism in the face of repression. Thank you for standing with us.
Remind me later.
