Gen Z Sandwich Generation Must Prepare This Before Retirement

Indonesia is expected to face a surge in the number of retirees by 2050, the majority of whom will come from Generation Z and millennials. This condition is seen as a warning for the younger generation to start preparing retirement funds early to avoid being trapped in the sandwich generation phenomenon. Chairman of the DPLK Sinarmas Asset Management Board, Stephanus Rudi OK, stated that based on data compiled in 2015, around 40 million people entered retirement age in 2025, and this figure is expected to continue rising in the following decade. “Without even considering the current economic symptoms, that is already 40 million. Then the next explosion of retiree numbers will be 70 million new retirees. The Gen Z and millennial population is in there,” Stephanus said during the launch of DPLK Sinarmas Asset Management at the Indonesia Stock Exchange (BEI) in Jakarta on Friday. According to him, the increase in the number of retirees could become a major challenge if it is not balanced by the public’s financial readiness. This is because the current productive generation will face the risk of declining welfare upon entering retirement age if they do not have long-term savings or investments. Similarly, Chairman of the Supervisory Board of DPLK Sinarmas Asset Management, Syarifudin Yunus, assessed that the main issue with pension funds in Indonesia is not just about income, but the low level of literacy and public awareness in preparing for old age. As a result, many retirees face economic hardship and remain dependent on family members, forming a sandwich generation. He explained that the sandwich generation phenomenon is still widespread in Indonesia, where a person must bear the economic needs of their parents, spouse, and children simultaneously. “I want to say that in Indonesia’s future, parents should not end up like me; this is the actual target. If education is successful, make access to pension funds easier. Everything is now online,” Syarifudin revealed. In an effort to address these challenges, PT Sinarmas Asset Management launched the Sinarmas Asset Management Financial Institution Pension Fund (DPLK SAM). This product is the first pension fund in Indonesia managed by an investment manager company. DPLK SAM adopts a digital approach through the SimPensiun platform, which allows the public to register, monitor funds, change investment choices, and disburse retirement benefits online. The platform is designed to reach the younger generation, particularly Gen Z and millennials who are entering their productive age. The launch of DPLK SAM took place amid the still low pension fund participation rate in Indonesia. Referring to the 2024-2028 Indonesian Pension Fund Development and Strengthening Roadmap, the density rate of the pension fund industry as of the end of 2023 had only reached 18.94% of the total 147.7 million workforce based on data from the Central Statistics Agency (BPS). As a newly operating digital-based DPLK, DPLK SAM is targeting aggressive growth in the coming years. In 2026, the company is aiming for assets under management of Rp150 billion with a total of 15,000 participants.