Thinking about retiring soon? You may wish you lived in any one of 18 other countries since they offer better safety nets for retirees than the United States, according to a new retirement index.
Norway, Switzerland, Luxembourg, Sweden and Austria rounded out the top five locations for living comfortably in retirement. Even the Czech Republic, Slovakia and Israel scored higher.
According to the index, which measured financial well-being, health and other factors that contribute to retirement security, the United States ranked 19th in the world.
The index was compiled by Natixis Global Asset Management, an asset management firm, which looked at 150 nations. It ranked the U.S. lower than less affluent nations in part because Americans will need to shoulder more of the financial burden of their retirement as the number of retirees grows and the government’s ability to supports them fades.
“Citizens of other industrialized nations can rely on strong social safety nets in old age, at least for now. In the U.S., we encourage workers to plan save and invest,” says John Hailer, president and CEO for the Americas and Asia at Natixis.
Not surprisingly, health care expenses, which take up a large portion of retirees’ spending, is a big issue. Though the U.S. leads the world in per capita health care spending, individuals are still required to pay a portion of those expenses on their own. And that takes resources away from retirees’ other needs.
By contrast, the robust health care and retiree social programs in Western European nations supports retirees’ ability to live comfortably there, the index found.
Like we didn’t already know, we’re not saving enough for retirement. Citing a Senate report, the index said our retirement savings deficit collectively is an astounding $6.6 trillion. As a result, 53 percent of workers 30 and older are “on a path that will leave them unprepared for retirement,” up significantly from 38 percent in 2011, the index found.
Photo credit: Steven Beger via flickr.com