During a casual chat when I recently returned to my hometown in central Taiwan to visit my parents, my father remarked, “It's been a while since I've received sticky rice” as a village offering by new parents, “… but I've seen more and more funeral tents.”

His observations were precise. My hometown, a small coastal village, saw its birth rate hit a new low this year, yet its aging rate is soaring like an airplane. My father was born into the postwar baby boom, and my grandmother had six children, a common occurrence back then. Overhearing my father's sentiments, my mother chimed in, “My seat number at elementary school was 60, and there were more behind me.”

These postwar generations became the primary source of Taiwan's demographic dividend – which refers to a period in which the working-age population (15 to 64) exceeds two-thirds of the total population, i.e. a dependency ratio below 50%. The continued growth of the young and middle-aged population drives economic growth. However, last year, the National Development Council estimated that starting in 2028, just three years from now, Taiwan's demographic dividend will inexorably end.

The government is apprehensive about this aging process, which means reduced tax revenue, a smaller labor force, increased social burdens, and a sizzling pressure cooker for labor and health insurance. Consequently, it has introduced various policies to encourage childbirth, yet the number of births continues to decline. Tung An-Chi, an associate researcher at the Academia Sinica and the author of this issue’s cover story, said, “Adult diaper sales have long surpassed those of baby diapers.” Instead of worrying daily about the declining number of babies and increasing number of people reaching retirement age, however, why not face reality and instead consider how to build a Taiwanese society with longer and healthier lives?

Article author Linus Chan suggests that this mindset requires redefinition: "Older adults are no longer mere consumers of social resources, but rather a sustainable resource capable of revitalizing their productivity and consumption potential." He argues that if social and financial mechanisms can be created to allow seniors to continue achieving their potential, aging is not necessarily a crisis. For the financial industry, it presents “a transformative opportunity to redefine customer lifetime value and risk assessment.”

This is the so-called longevity dividend. A Harvard University study indicates that while aging has reduced the average annual GDP growth rate from 2.5% to 1.7%, with proper planning, the longevity dividend could bring it back to 2.1%. However, Taiwan’s financial industry is clearly still in its infancy in this regard. Faced with these post-war baby boomers with accumulated wealth, wealth management products are still designed with capital preservation, risk mitigation, and inheritance in mind, ignoring the higher requirements and demands of this group for asset appreciation to make the most out of their longer remaining lifespan.

Of course, it is normal for people to become more stable and conservative as they get older. Therefore, designing eye-catching financial products which can balance asset appreciation with security will be an area of innovation for the financial industry. In the past, sunset was used to describe old age, as if life were like an hourglass counting down – but keeping in mind that after the hourglass has run out, we can turn it over again and start over, the sunset of life is also its sunrise.