You can save money but what are you going to do with it? If there aren't enough young people providing the goods and services the retired people need in retirement, the prices of those goods and services will skyrocket and many who saved won't be able to afford the goods and services.

That's what people do, but to do so they need to work in growth industries and geographies. Otherwise you don't make enough to do just that. Thus they go somewhere that does, in this case Tokyo mostly. Which makes the situation worse for the prefectures that they leave causing brain drain, and now those that stayed need to have the taxation to cover for the two they were already on the hook for, and now the two that the person gone to individualistically "save for their own retirement".

This generally leads to services and infrastructure getting shut down. Not more stuff spread out to less people because certain modern lifestyle features, things like hospitals, need a minimum level of patients and experts to function well above zero.

Saving doesn't solve the problem. In fact, no re-allocation of money would provide a good standard of living with only a small young population to do all the work while a large old population consumes.

> each person show be saving for their own retirement

Saving where, the stock market? I wouldn't be surprised if a shrinking population means a shrinking stock market too.

a very good plan right up until you fall off a ladder