Ageing Thais put pressure on creaking pension system

Thailand's ageing population is placing increasing strain on the country's pension system, with people over 60 set to make up a third of the population within the next 25 years, according to Kiatnakin Phatra Financial Group (KKP). Currently, those over 60 account for 24% of Thailand's total population. The nation is rapidly aging while its per capita income remains modest.

Government welfare provisions are insufficient to support retirees, with over 54% of Thai workers outside the social security system. The old-age allowance only covers around 7% of living expenses for older Thais. KKP's chief economist, Pipat Luengnaruemitchai, warned that government welfare could decline over the next 20 years as the financial burden grows.

Many Thais have not established savings plans, and more than 80% of their savings are in low-risk assets that fail to keep up with inflation. Consequently, nearly 70% of elderly people rely on financial support from their children or continue working. Longer life expectancies, with 47% of 60-year-olds projected to live until at least 85, and rising healthcare costs further exacerbate the situation.

KKP has introduced a two-stage retirement investment strategy to help investors accumulate wealth before retirement and generate regular income post-retirement.