\n\tRIYADH: Saudi Arabia has an opportunity to strengthen its retirement system and unlock billions of riyals in long-term domestic investment, according to a BlackRock report, which found that while many workers are financially confident today, fewer are adequately prepared for retirement.\u00a0<\/p>\n
\n\tThe \u201cRead on Retirement: GCC 2026\u201d report argues that expanding workplace retirement savings plans and encouraging long-term investing could improve financial security for individuals while supporting Saudi Arabia\u2019s Vision 2030 goals of diversifying the economy and deepening capital markets.\u00a0<\/p>\n
\n\tThe findings come as the Kingdom continues to reform its financial sector, with initiatives aimed at increasing household savings and expanding investment opportunities for both Saudi nationals and expatriates.\u00a0<\/p>\n
\n\t\u201cDeveloping robust retirement systems is not just a social imperative, it is a capital markets opportunity,\u201d Kashif Riaz, head of BlackRock Riyadh Investment Management and Middle East Financial Advisory, said.\u00a0<\/p>\n
\n\t\u201cBy moving toward funded, long-term savings frameworks, Saudi Arabia can mobilize domestic capital at scale, channeling household savings into productive investment, deepening local markets, and supporting the Kingdom\u2019s broader economic diversification agenda,\u201d he added.\u00a0<\/p>\n
\n\tSaudi-expat retirement confidence gap<\/p>\n
\n\tThe study found that 75 percent of workers in Saudi Arabia have either started saving or are planning for retirement. However, only 57 percent regularly save or invest, while just 24 percent contribute to pensions or dedicated long-term savings plans.\u00a0<\/p>\n
\n\tThe report also revealed a significant divide between Saudi nationals and expatriates. While 59 percent of Saudis said they feel financially prepared for retirement, only 41 percent of expatriates shared the same confidence, largely because many rely on personal savings rather than structured pension schemes.\u00a0<\/p>\n
\n\tOverall, half of respondents expect personal savings and investments to fund their retirement, while only 6 percent anticipate relying on employer-sponsored retirement plans. More than one-third of Saudi nationals expect public pensions to remain a key source of retirement income.\u00a0<\/p>\n
\n\tThe survey also highlighted how household wealth is currently allocated. Nearly half of respondents hold their savings in cash, 40 percent invest in gold and only 18 percent own property, suggesting that much of the country\u2019s household wealth is not invested in long-term growth assets.\u00a0<\/p>\n
\n\t\u2018Start saving from day 1\u2019<\/p>\n
\n\tFor many retirees, the report\u2019s findings reflect personal experience.\u00a0<\/p>\n
\n\tMohsen Ibrahim, a Saudi retiree in his seventies, told Arab News that although he understood the importance of planning for retirement, he struggled to put those plans into action.\u00a0<\/p>\n
\n\t\u201cWhen I retired, I didn\u2019t feel financially prepared,\u201d he said. \u201cLong before my retirement, I was aware of the consequences and obligations that I\u2019d be facing. However, I mismanaged my finances and didn\u2019t put solid plans in place. Even when I did make plans, I didn\u2019t stick to them.\u201d\u00a0<\/p>\n
\n\tLooking back, Ibrahim believes financial discipline should begin as soon as people enter the workforce.\u00a0<\/p>\n
\n\t\u201cMy first advice to young Saudis is to start saving from your first day of employment or your first paycheck,\u201d he said. \u201cI would assume at least 50 percent of your income, no matter how big or small your salary is. Then, the second step is laying out a primary financial plan.\u201d\u00a0<\/p>\n
\n\tSaudi financial analyst Talaat Hafiz told Arab News that strengthening retirement savings could deliver benefits far beyond individual financial security.\u00a0<\/p>\n
\n\t\u201cA stronger retirement savings system could play a transformative role in advancing Saudi Arabia\u2019s economic development,\u201d he said.\u00a0<\/p>\n
\n\t\u201cBy generating a stable pool of long-term domestic capital, retirement funds can be invested across equities, fixed income, infrastructure and private markets. This enhances capital market liquidity, supports business growth and reduces reliance on short-term financing.\u201d\u00a0<\/p>\n
\n\tHafiz said retirement reform aligns closely with Vision 2030\u2019s objective of increasing household savings from 6 percent to 10 percent of household income.\u00a0<\/p>\n
\n\t\u201cStrengthening the retirement savings system is not solely about enhancing retirement security; it is also about mobilizing long-term domestic savings to support economic transformation,\u201d he said.\u00a0<\/p>\n
\n\tHe added that countries with mature pension systems generally enjoy deeper and more resilient capital markets, creating a virtuous cycle between household savings and economic growth.\u00a0<\/p>\n
\n\tKnowledge gap<\/p>\n
\n\tDespite widespread interest in saving, many workers remain uncertain about how to prepare for retirement. According to the report, only 21 percent of Saudi nationals said they are confident they understand their retirement options.\u00a0<\/p>\n
\n\tAmong the biggest obstacles identified were limited access to unbiased financial information, uncertainty over how much to save and confusion about available retirement products.\u00a0<\/p>\n
\n\tThe report found that 36 percent of respondents did not know where to find impartial financial guidance, while 32 percent were unsure how much they should be saving and 26 percent did not know what retirement savings options were available.\u00a0<\/p>\n
\n\tHafiz said the issue is not a lack of willingness but a lack of confidence.\u00a0<\/p>\n
\n\t\u201cLimited financial literacy, concerns about investment risk and a cultural preference for tangible assets such as real estate and gold continue to discourage many people from investing for the long term,\u201d he said.\u00a0<\/p>\n
\n\t\u201cImproving financial literacy, expanding access to retirement savings products and building public confidence in long-term investing would enhance individual retirement preparedness while supporting Saudi Vision 2030.\u201d\u00a0<\/p>\n
\n\tThe report also found strong support for workplace retirement programs.\u00a0<\/p>\n
\n\tAmong Saudi nationals, 95 percent said defined-contribution workplace savings schemes were appealing, while 91 percent said they would consider participating.\u00a0<\/p>\n
\n\tWorkers who already had access to workplace retirement plans also reported significantly higher levels of retirement confidence than those without such schemes.\u00a0<\/p>\n
\n\tFor expatriates, Hafiz said Saudi Arabia already offers a broad range of investment opportunities, including more than 360 mutual funds and access to the Saudi stock market.\u00a0<\/p>\n
\n\tHowever, introducing voluntary employer-sponsored retirement plans with matching contributions could encourage more disciplined long-term saving.\u00a0<\/p>\n
\n\tHe also pointed to recent government initiatives designed to encourage a stronger savings culture, including the General Organization for Social Insurance\u2019s GOSI Jameya, a rotating savings product for retirees, and the Ministry of Finance\u2019s Sah Government Savings Sukuk Program, which offers individuals an accessible government-backed savings instrument.\u00a0<\/p>\n
\n\tLooking ahead, Hafiz believes Saudi Arabia is moving in the right direction but said the next phase should focus on expanding voluntary retirement savings programs, improving financial literacy, encouraging greater private-sector participation and using digital technology to make retirement planning more accessible.\u00a0<\/p>\n
\n\t\u201cUltimately, retirement savings should not be viewed simply as a social policy,\u201d he said. \u201cIt is also an economic strategy that supports financial security for individuals while providing long-term capital that contributes to sustainable economic growth and diversification.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"RIYADH: Saudi Arabia has an opportunity to strengthen its retirement system and unlock billions of riyals in long-term…\n","protected":false},"author":2,"featured_media":722481,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[84,4176,4174,4175,56,54,55],"class_list":["post-722480","post","type-post","status-publish","format-standard","has-post-thumbnail","category-personal-finance","tag-business","tag-finance","tag-personal-finance","tag-personalfinance","tag-uk","tag-united-kingdom","tag-unitedkingdom"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/722480","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=722480"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/722480\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/722481"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=722480"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=722480"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=722480"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}