The U.S. might get a lot of things right as a country, but retirement is far from one of them, a new global ranking of retirement security suggests.
The top nation for retirement security is Norway, followed by Switzerland and Iceland, according to the new study from Natixis Investment Managers. The U.S. slipped two places in this year’s analysis, from No. 18 in 2022 to No. 20 on this year’s ranking of 44 nations.
The reasons for America’s middling standing when it comes to retirement security come down to the nation’s high inflation and rising government indebtedness, as well as lowered life expectancy, which has due to COVID and rising overdose and gun-related deaths.
Hoping for a miracle
At the same time, more Americans are expressing increased anxiety about retirement, with Natixis finding that 47% said it would “take a miracle” for them to achieve retirement security, up 6 percentage points from 2021.
“The big thing has been inflation, and even though it’s come under control more in the past six months, eight months, people have a bit of post traumatic stress from it,” Dave Goodsell, head of the Natixis Center for Investor Insights, told CBS MoneyWatch.
He added, “A good example is the number of people who said it would take a miracle to retire. Part of that is feeling the pressure of higher prices.”
Notably, these feelings of stress are coming from a survey group of affluent, individual investors with at least $100,000 in investable assets, while roughly half of Americans have nothing saved for retirement.
Almost half of those surveyed by Natixis said they believe they’ll have to make tough choices in their later years, with one-third believing they’ll need to work in retirement and about a quarter expecting they’ll have to sell their home.
“The simple truth is you don’t need a miracle — you need a plan,” Goodsell said. “You really need to step back and see what you can possibly do to increase your odds of success.”
The global index of retirement security ranks nations based on four areas: health, quality of life, finances in retirement and material well-being.
“Countries in the top 10 overall tend to be good all-rounders,” the Natixis analysis found.
Norway, which the firm called a “standout performer,” ranked first in health and fourth in quality of life. Life expectancy rose in Norway, in contrast the the U.S.’ decline. The U.S. ranked 25th for health in the current survey, down from 17th in the prior year.
“If you look at the top performers, they tend to be smaller countries,” Goodsell noted. “It’s easier for a smaller country to get consensus on a lot of the issues, say, like health care,” compared with larger countries like the U.S.
Below are the country rankings in the 2023 Natixis Investment Managers Global Retirement Index:
8. New Zealand
16. United Kingdom
18. Czech Republic
20. United States
27. Slovak Republic
39. Russian Federation