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13 Sep 2023

Thai Economy

Financial sector can help the silver age prepare for a more stable life (Current Issue No.3432 Full Ed.)


        The elderly or silver age population worldwide is set to increase at a steady and rapid rate. Silver age consumers, therefore, will become an economically important segment as the amount of their spending is higher than that of other age groups. Deloitte has projected that spending by Thai silver age consumers will reach US331 billion by 2030, surpassing that of Singapore, and Thailand will be the first developing country in the world to become a super-aged society by 2029. The transition towards an aging society, however, poses challenges for Thailand due to the relatively fragile financial position of the majority of senior citizens and insufficient state welfare benefits, or sometimes referred to as “elderly poverty”. We at KResearch, see that the financial sector can act as another catalyst for nurturing quality lifestyles among silver age consumers.
        The majority of Thai senior citizens are unprepared for retirement because of their relatively low income and savings while state welfare benefits are limited. With such economic status, they are still working or relying on their children for support. Presently, approximately 34 percent of the elderly population earn less than THB30,000 per year, which is below the poverty line. As a result, only five percent of all the elderly in Thailand have savings, and 40 percent of them have savings less than THB50,000 per person, suggesting that their financial position remains fragile, and their retirement is susceptible to financial risks. Additionally, state welfare benefits, including a monthly allowance of THB600-1,000 on average for all Thai senior citizens, remain inadequate.  

        Thailand will likely become the first country in the world to experience “elderly poverty”. This issue presents challenges for the country in terms of the demographic structure, workforce, economic growth and fiscal position of the government. Notwithstanding this, KResearch believes that the financial sector can act as a catalyst for nurturing high-quality, stable lifestyles among aging consumers by enabling both immediate income generation and ensuring long-term savings stability. Improvements for financial products in Thailand can be made if there is support from and cooperation between the private and public sector agencies.   

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Thai Economy