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The world is living longer. By 2050, 16% of the population of democratic countries that support free market economies will be over the age of 65.1 This should be celebrated, but we also must consider the implications increased longevity has on the financial systems intended to meet retirement needs. In many countries, these systems are adapting. In these papers, we review some of these changes, while also considering the implications for members in these systems. For many, modifications in lifestyle and savings habits will need to be considered.

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WHAT ARE THE RISKS?

All investments involve risks, including possible loss of principal. The value of investments can go down as well as up, and investors may not get back the full amount invested. Stock prices fluctuate, sometimes rapidly and dramatically, due to factors affecting individual companies, particular industries or sectors, or general market conditions. Bond prices generally move in the opposite direction of interest rates. Thus, as prices of bonds in an investment portfolio adjust to a rise in interest rates, the value of the portfolio may decline. Special risks are associated with foreign investing, including currency fluctuations, economic instability and political developments.

  1. United Nations, Department of Economic and Social Affairs: Population Dynamics, World Population Prospects.

IMPORTANT LEGAL INFORMATION

This material is intended to be of general interest only and should not be construed as individual investment advice or a recommendation or solicitation to buy, sell or hold any security or to adopt any investment strategy. It does not constitute legal or tax advice.

The views expressed are those of the investment manager and the comments, opinions and analyses are rendered as at publication date and may change without notice. The information provided in this material is not intended as a complete analysis of every material fact regarding any country, region or market. All investments involve risks, including possible loss of principal.

Data from third party sources may have been used in the preparation of this material and Franklin Templeton ("FT") has not independently verified, validated or audited such data. FT accepts no liability whatsoever for any loss arising from use of this information and reliance upon the comments opinions and analyses in the material is at the sole discretion of the user.

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Investments entail risks, the value of investments can go down as well as up and investors should be aware they might not get back the full value invested.

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