The best — and worst — countries to retire in Europe

In fact, since 2021, three countries have topped Mercer CFA Institute’s global index. That is, Iceland (average 84.6), the Netherlands (average 84.4) and Denmark (average 81.8) are considered to have the best pension systems compared to these countries. For the past 3 years.

Eimear Walsh, head of Mercer, said: “All three countries have large industrial funds with defined contributions from workers and employers. They have mandatory or quasi-mandatory schemes. The country benefits from economies of scale compared to a fragmented market like the UK,” said Eimear Walsh, head of Mercer. She spoke to CNBC about investing and wealth.

The Netherlands achieved the highest overall index value (85.0) this year thanks to its generous benefits package, strong asset base and sound regulation, while popular European destinations such as Spain, Italy and Croatia It faces some drawbacks.

The Mercer Index consists of three subcategories that evaluate pension plans: adequacy, sustainability, and completeness.

The main purpose of a pension system should be to provide sufficient income to retirees – essentially a safety net. A government’s ability to create incentives for average earners to save for retirement is critical to the health of any system.

Payment plan design is also important, according to Mercer’s rankings, as is whether workers can continue receiving benefits when they are temporarily away from work for child care or illness.

Portugal’s income-based state pension system earned it the top spot in Mercer’s index with a score of 86.7 in its latest report. The Netherlands came in a close second with a score of 85.6. Both systems have minimum pension rates and a net for the lowest income groups.The lowest rating in Europe was 31st place in Poland.^cent Globally, it has a score of 59.8.

Portugal was also named the best country to retire in Europe. Immigration to Spain, a moving company. The June report ranked European countries on several factors including visas, beaches, safety and house prices.

Another listing for asset management company Black Tower, Released in 2021using several key factors, ranked it much higher among European countries and placed Belarus at the bottom.

Accumulated pension plans provided by the private sector also play an important role in stabilizing the country’s retirement system. The Mercer Index examines whether countries’ private pension plans are creating sufficient value for members and whether there is sufficient public confidence in these plans.

Finland had the highest integrity score in 2023 at 90.9. Belgium ranked second with a score of 88.2, and the Netherlands ranked her third with a score of 87.7. France was the worst performing country in Europe, with a score of 54.4. Notably, the United States also ranks well below the world average in this category with her 59.5 points.

Finland is also classified as a “happy place” for retirees by the Natixis index. Despite not being in Natixis’ top 10 overall score, Finland has topped the investment bank’s Quality of Life category for the fifth year in a row. According to the report, high happiness scores, high air quality, water and sanitation, and biodiversity are the main factors behind Finland’s first place.

Norway was the top performer in the 2023 Natixis Index, maintaining its position from last year with an overall score of 83%. Switzerland ranks second in the overall index and tops in the “retirement benefits” sector.

Mercer believes long-term national economic growth will also play an important role. This is because it directly impacts the workforce and the amount saved for retirement. Additionally, the amount of debt a country carries and the amount of public funds spent on pensions impact the sustainability of the retirement system.

Based on these factors, Iceland has the most sustainable system in Europe, with a rating of 83.8. Denmark and the Netherlands follow with 82.5 and 82.4 respectively. Italy has the lowest score in Europe with 23.7 points, followed by Spain with 28.5 points.

However, Mercer’s Walsh noted that there are some soft factors not taken into account in the index that may still make countries like Italy and Spain popular retirement destinations for many people. .

“We focus on pension systems, but that’s not the only thing to consider. It’s an important balance. A lot of it also depends on the tax system, the climate and culture of the country, and whether people are actually happy there. It also depends on whether you can become “,” she said.