Most discussion of aging focuses on the rapidly escalating cost of pensions and health care, not the potentially far more damaging effects on wealth, savings, and economic well-being. A McKinsey Global Institute (MGI) study of Germany, Italy, Japan, the United Kingdom, and the United States shows that as more and more people retire, lower savings rates will hold back growth in household financial wealth. By 2024, it will be 36 percent—$31 trillion—less than it would have been if historical rates of expansion had persisted. This reality will depress investment, growth, and living standards in the largest, wealthiest economies and threaten the future development of poor ones.

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