Both demand for international pension and savings plans and the assets managed by those plans are growing.
Nearly a quarter of the 1,023 plans included in advisory firm WTW’s International Pension Plan Survey were established in the past five years, and assets under management of the plans grew to $19.3 billion, up 5% from the year before, according to the results of the survey, released March 6.
About half of the plans were established for expatriate workers who couldn’t stay on plans in their home country and either couldn’t get a plan in their host country or weren’t entitled to a benefit from a host plan, the survey found.
“Companies are facing skills shortages in many hotspots across the world and are redefining their employee experience and total benefits offer to stay competitive,” Tony Broomhead, managing director of integrated and global solutions for WTW, said in a news release. “Many multinationals, charities and international governmental organizations are looking for ways to offer minimum yet sufficient levels of pensions and savings to their global staff.”
Employers are also offering international pension and savings plans to employees in unstable countries, the survey found.
Thirteen percent of plans were created for local employees, typically in countries with economic or political instability, the survey found. The top countries for workers on these plans were Egypt, Argentina, Lebanon, Sri Lanka and Ecuador.
“Expats are often excluded from joining local ‘host’ pension schemes, or it may be inadvisable for them to do so. And local staff in many countries may also have limited options, or any savings may face the risk of economic instability or local sovereign debt default. International plans are a flexible way for employers to offer these vital benefits in a secure and efficient way,” Broomhead said.