Pension dilemmas for expatriates : an analysis of need structures and potential solutions

Abstract

Purpose: The purpose of this thesis is to examine a market opportunity with the Market Opportunity Navigator by Marc Gruber and Sharon Tal in order to discover and develop a product fit for a specific market, namely for self-initiated expatriates in the Asia Pacific region needing to fill their pension gaps after living and working away from their home country. Since the trend for self-initiated expatriation has risen to currently 80% of the expatriate workforce in the APAC region, the lack of financial education may pose some risks regarding pension benefits and other long-term financial implications. This thesis explores how to ameliorate this problem and develop a solution for it. Design/methodology/approach: The approach of exploring the market opportunity is done with the Market Opportunity Navigator, in combination with scientific research, market research, surveys and interviews. Findings: Findings have been that previous to this thesis there has not been any scientific research done on the financial implications of self-expatriation, neither short term nor long term. Another finding has been that there is a need and demand for financial education for the specific situation of self-initiated expatriates, the details of which has been drilled down and refined through surveys and interviews. Research limitations/implications: Limitations of the research were the fairly small survey pool which should be representative enough for the thesis, yet more deep dive must be done in the future. The methodology does not take current the extreme political and pandemic situation into account, which will have an influence over the next 24-36 months. Practical implications: This thesis poses a thought stimulus on the situation of the self-expatriated, who may be financially at risk in old age if no provisions are taken. A strategy to reach this community and help with long term, low cost solutions is proposed in this thesis as well as the consideration of continuing research on this topic. Originality/value: A first step has been done in order help self-initiated expatriates in giving guidance on financial pitfalls when working abroad without paying into the home country’s or local pension scheme. So far there has been no scientific research on this topic, neither about long term implications, loss of retirement income, tax implications or alternative solutions. The originality lies therein that this topic needs further research and solutions