The ‘silver dollar’ opportunity: how can global governments best compete for retirement capital? 

Designing a pensions system to attract retiring expatriates

What do governments need to do to attract and retain expatriates after their working lives? 

Ahead of the 2024 World Governments Summit, Mercer partnered with the organizing committee to consider what governments need to do in order to attract and retain expatriates after their working lives.

The ‘silver dollar’ opportunity: competing for retirement capital

At the end of their working lives, expatriates must decide whether to repatriate to their home country or extend their stay overseas into retirement.

For countries building – and growing – a strong expatriate component within their workforce, the ‘silver dollar’ opportunity to retain these workers up to and during retirement should not be overlooked. We expect the competition for retirement capital to evolve rapidly in the next decade.

Established and emerging retirement destinations have a distinct head start through existing and fast-growing expatriate populations. By adopting policies specifically designed to incentivize expatriate workers to remain in a jurisdiction through retirement – converting expatriate workers into expatriate retirees – countries can capitalize on this head start in the competition for ‘silver dollars’.

Key considerations in the competition for retirement capital 

Attracting and retaining expatriates up to and through retirement requires a whole-of-economy plan that considers how the major drivers of relocations overseas evolve throughout a career and into retirement abroad. Governments must seek to:  

Expatriate populations are growing internationally in markets where workers are attracted by employment or education opportunities that promise higher salaries and a better quality of life. Countries accrue significant direct and indirect economic benefits from attracting expatriates, including knowledge transfer, growth in the economy and addressing demographic challenges. However, there is an opportunity for jurisdictions to adopt a longer-term approach to attract and retain expatriates up to and through retirement.

Expatriate jurisdictions should consider how a long-term savings vehicle could support wider policy efforts to encourage expatriate workers to remain until and through retirement. However, countries must overcome complex policy design challenges around scale, flexibility and securing investment outcomes to ensure that the proposition is appealing to expatriates relative to what they could access through a return to their home nation or elsewhere.

There are lessons to be learnt from countries that have already put in place policies that address some of the obstacles to attracting expatriate workers and retirees, including specialized visas and tax policies. A whole-of-economy policy framework that includes strong retirement provisions could help support significant long-term economic benefits.

Design of a novel defined contribution pension scheme for expatriates with clear benefits during the accumulation and decumulation phases can contribute as part of a broader policy package designed to support and attract expatriates up to and through retirement.

The ‘silver dollar’ opportunity: competing for retirement capital

As more countries seek to build their expatriate populations both to and through retirement, markets with a high and/or growing expat community have a head start on the “silver dollar” opportunity. In order to compete for retirement capital, governments and policymakers need to establish and optimize long-term savings frameworks; our report considers how this can be achieved.

About the authors:

  • Robert Ansari
    Partner, Head of Investments and Retirement - India Middle East and Africa, Mercer

  • Preeti Chandrashakhar
    Business Leader, Health and Wealth, India, Mercer

  • Vince Cordova
    Partner and Senior Director - Mobility Consulting, Mercer

  • Nick Davies
    Partner, Senior Investment Consultant, Mercer

  • Asad Hussain
    Senior Investment Consultant, Middle East, Mercer

  • Christine Mahoney
    Senior Partner, Global Defined Benefit/Defined Contribution Leader, Mercer

  • Qamar Shazad
    Actuarial Consultant, Mercer
This article is intended as a basis for discussion only. Whilst every effort has been made to ensure the accuracy and completeness of the material in this article, the authors give no warranty in that regard and accept no liability for any loss or damage incurred through the use of, or reliance upon, this article or the information contained therein.

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