Managing Future Longevity Risk: Financial Implications of Ageing Populations

John Kiff, Senior Financial Expert, IMF

Ira Pastor, ideaXme life sciences ambassador, interviews John Kiff, Senior Financial Sector Expert at the International Monetary Fund (IMF) Financial Stability Division in the Monetary and Capital Markets Department.

Ira Pastor Comments

So on past shows as we’ve been profiling many of the novel products and technologies being developed by industry, by academia, and by governments on the healthy aging and longevity front, we’ve also taken time to discuss a range of the traditional and novel funding pools emerging to support these programs, from traditional life science venture capital and private equity, to the public stock markets, to innovative prize models, such as UK Research and Innovation’s (UKRI) Healthy Ageing Challenge program and the Healthy Longevity Global Grand Challenge of the U.S. National Academy of Medicine.

Today, we are going to stay on this financial theme, but are going to head in a different direction, to talk to a thought leader who is asking the really big questions today, about what the future of global financial stability looks like, especially in a world where technologies may soon allow for “90 to become the new 50.”

That people are now living longer, due to science and technology, is very desirable and has greatly improved individual welfare. However, there are financial costs of longer life expectancy, for governments through employee retirement plans and social security schemes, for corporate employers with defined-benefit pension plans, for insurers that sell annuities, and for individuals without guaranteed retirement benefits.

The financial implications of longevity risk (defined as the financial implications of people living longer than expected) are very large. It is estimated that if average life spans by 2050 were to increase only 3 years more than now expected, the already vast cost of aging would increase by 50 percent, with private defined benefit pension liabilities alone amounting to greater than $23 trillion.

The International Monetary Fund (IMF) is an international organization headquartered in Washington, D.C., consisting of 189 countries working to foster global monetary cooperation, secure financial stability, facilitate international trade, promote high employment and sustainable economic growth, and reduce poverty around the world.

John Kiff

John Kiff is a Senior Financial Sector Expert at the International Monetary Fund (IMF) Financial Stability Division in the Monetary and Capital Markets Department.

As part of this team since 2005, he is involved in producing the IMF’s semi-annual Global Financial Stability Report, as well as focusing on OTC derivative market infrastructure, securitization, and longevity risk transfer markets.

Mr. Kiff is also focused on fintech and digital asset policy issues, including producing the IMF’s monthly Fintech Update, and co-writing staff discussion notes on central bank digital currency.

Prior to the IMF, John worked at the Bank of Canada for 25 years, where he spent most of his time managing the funding and investment of the government’s foreign exchange reserves.

On this episode we will hear from Mr. Kiff about:

His background; how he developed an interest in economics, in central banking, and how he became focused on the topic of longevity risk management. A general introduction to the IMF as well as its relationship with the World Bank. A general discussion about “Longevity Risk” and the tools of Longevity Bonds and Longevity Swaps. A discussion of some other novel financial instruments and strategies for managing Longevity Risk. His work in the areas of digital currencies.

Credits: Ira Pastor interview video, text, and audio.

Follow Ira Pastor on Twitter: @IraSamuelPastor

If you liked this interview, be sure to check out our interview on Human Longevity via Preventative Medicine!

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