Top 20 Countries With the Best Retirement Systems

Mixing government pensions with private savings helps these countries offer their senior citizens a healthy retirement.

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Updated July 11, 2024
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In the global landscape of retirement planning, certain countries stand out for their robust and comprehensive retirement systems. Based on data from Mercer, a leading global consulting firm, we delve into the top 20 countries offering retirees the most secure and sustainable retirement plans.

From Europe to Oceania and beyond, these nations prioritize the financial well-being of their aging populations, providing a blueprint for effective retirement planning worldwide. Each country’s index is calculated based on three main factors:

  • Adequacy: How much do you get?
  • Sustainability: Can the system keep delivering?
  • Integrity: Can the system be trusted?

In these countries, some people may be able to retire early. Let’s see how they stack up.

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20. Kazakhstan

podgorakz/Adobe Buildings in Kazakhstan

Kazakhstan’s retirement income system comprises a basic pension and an earnings-related benefit (for retirees with service records before 1998), both paid from general government revenue.

A fully funded mandatory defined contribution (DC) component launched in 1998 requires a compulsory employee contribution of 10%, with additional employer-sponsored contributions for hazardous conditions.

19. Germany

JFL Photography/Adobe berlin skyline panorama

Germany’s retirement income system integrates an earnings-related, pay-as-you-go structure with supplementary plans from major employers. The nation emphasizes the importance of a minimum pension for low-income pensioners and aims to expand private pension coverage.

By enhancing funding in private plans and ensuring broader employee participation, Germany aims to fortify its retirement income system.

18. Portugal

TTstudio/Adobe lisbon portugal skyline

Portugal's retirement system features an earnings-related public pension supplemented by voluntary personal and occupational schemes. Addressing low coverage in private plans and reducing government debt are focal points for the system’s improvement.

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17. New Zealand

Martin Valigursky/Adobe Sheep on a field near lake in New Zealand

New Zealand’s retirement income framework encompasses a universal public pension alongside voluntary schemes like KiwiSaver. Efforts to boost KiwiSaver contributions and coverage and reduce household debt aim to enhance retirement readiness and overall financial security later in life.

16. Austria

Iraklis Milas/Adobe christmas market in front of rathaus

Austria's retirement system comprises a public pension scheme supplemented by voluntary private plans. With a focus on aiding low-income individuals and expanding pension coverage, Austria strives to strengthen its retirement landscape.

Increasing support for low-income pensioners, fostering greater pension plan access, and implementing protective measures for divorcees are key strategies for Austria’s retirement system.

15. Uruguay

danflcreativo/Adobe la barra beach

Uruguay’s retirement system merges a state pension with mandatory private arrangements, emphasizing individual contributions for retirement benefits. Strengthening private pension contributions and governance standards and adapting pension ages to life expectancy changes can further enhance Uruguay's retirement system.

14. Chile

michalknitl/Adobe Navarino Island in Chile

Chile's retirement model integrates social assistance with a privately managed mandatory DC system, focusing on improving support for low-income seniors and expanding employer-sponsored plans.

Elevating minimum support for impoverished seniors, raising the retirement age for women, and broadening occupational plan coverage will further improve Chile's retirement system.

13. Ireland

borisb17/Adobe temple bar street dublin ireland

Ireland's retirement system offers a basic social security scheme complemented by voluntary occupational and personal pensions. The nation's shift toward auto-enrollment aims to enhance pension coverage and savings. In addition, bolstering workforce participation among seniors and safeguarding members' pension benefits are crucial for the system's evolution.

12. Canada

Maurizio De Mattei/Adobe  famous harbor front of Lunenburg Nova Scotia Canada

Canada's retirement structure encompasses universal pensions, voluntary occupational plans, and individual savings accounts, focusing on expanding pension plan coverage. Augmenting pension plan accessibility, introducing minimum access ages, and encouraging household savings are vital for system enhancement.

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11. Switzerland

ake1150/Adobe Spiez castle with cruise ship

Switzerland’s retirement system balances public and private pensions, emphasizing a transition toward retirement income streams. Introducing income stream requirements, adjusting retirement ages, and promoting homeownership are further strengthening Switzerland's retirement framework.

10. United Kingdom

Sergii Figurnyi/Adobe red double decker bus

The U.K.'s retirement landscape comprises a state pension supplemented by occupational and personal pensions, with a recent emphasis on auto-enrollment.

Efforts to broaden pension scheme coverage and increase minimum contributions are underway. Restoring income stream requirements, expanding pension coverage, and reducing household debt can enhance the U.K.'s retirement system even more.

9. Sweden

Mistervlad/Adobe Stockholm old town (Gamla Stan) cityscape

Sweden's retirement structure integrates notional accounts with mandatory DC plans, with efforts to adapt to demographic changes. Emphasizing workforce participation and tax incentives for retirement savings are key strategies. Raising pension ages, facilitating employee contributions, and reintroducing tax incentives will boost Sweden's retirement system.

8. Norway

Tomas Marek/Adobe fishing village undredal

Norway’s retirement system emphasizes earnings-related pensions alongside occupational plans, with an emphasis on bolstering mandatory contributions and household savings.

Promoting voluntary contributions and introducing divorce protection measures are pivotal for system enhancement. By encouraging savings and fortifying pension contributions, Norway is working to further improve its retirement system sustainability.

7. Singapore

krunja/Adobe airplane flying over singapore

Singapore's retirement framework centers on the Central Provident Fund (CPF), featuring provisions for housing and medical expenses alongside retirement savings. Broadening access to tax-approved retirement plans and enhancing communication with members is critical.

Streamlining corporate retirement plans, extending CPF benefits to non-residents, and improving member communication can boost Singapore's retirement system.

6. Finland

Mistervlad/Adobe helsinki cityscape

Finland's retirement system integrates a basic pension with statutory earnings-related schemes, focusing on increasing support for seniors and increasing savings.

Augmenting support for low-income retirees, promoting savings, and ensuring divorce protection are pivotal. By prioritizing support for vulnerable retirees and encouraging savings, Finland aims to fortify its retirement system.

5. Australia

yongtick/Adobe circular quay in sydney australia with tourists during day time

Australia's retirement income system features a means-tested age pension supplemented by mandatory employer contributions to private-sector plans. Additional voluntary contributions enhance retirement savings.

To improve its system, Australia could moderate means-tested pension tests, introduce mandatory income streams in retirement, offer government contributions for primary caregivers, and provide clearer benefit projections.

4. Israel

rudi1976/Adobe tel aviv skyline

Israel’s retirement income system combines a universal state pension with private pensions featuring compulsory contributions from employers and employees. Minimum annuity requirements ensure steady retirement income.

To strengthen its system, Israel could work on reducing government debt, improving protection for pension plan members, and introducing a carer’s pension credit for caregivers.

3. Denmark

Annap/Adobe Solvang, California

Denmark’s retirement income system includes a public basic pension supplemented by means-tested benefits and fully funded DC schemes. Mandatory occupational plans ensure retirees have lifelong financial security.

To enhance its system, Denmark might focus on protecting the interests of both parties in a divorce and requiring all pension plans to provide annual reports for transparency.

2. Iceland

Marc Jedamus/Adobe reykjavik at wintertime Iceland

Iceland's retirement income system features a basic state pension complemented by a pension supplement and mandatory occupational private pension schemes. Contributions from both employers and employees ensure robust funding for retirees.

To bolster its system, Iceland could work toward protecting pension interests in divorce cases and lowering government debt as a percentage of GDP.

1. Netherlands

andreykr/Adobe colorful building at water coast with boats in amsterdam netherlands

The Netherlands currently boasts the No. 1 retirement income system in the world, anchored by a flat-rate public pension and quasi-mandatory earnings-related occupational pension schemes. This comprehensive approach ensures retirees receive stable income streams linked to industrial agreements.

To enhance its system further, the Netherlands could focus on increasing labor force participation among older adults and introducing a carer’s pension credit for those caring for young children.

Bottom line

Xavier Lorenzo/Adobe senior couple enjoying summer vacation

Wondering where the U.S. ranked in this survey? It came in at No. 22.

As you explore the top retirement systems globally, reflect on your priorities for retirement. Consider factors like income security, health care provisions, and lifestyle preferences. Have you made the right money moves to fund your retirement?

Whether it's a robust public pension or comprehensive private savings options, the choice of a retirement destination significantly impacts the quality of your golden years.

What aspects of retirement planning resonate most with your aspirations and financial goals? Consider the 20 countries above if you’re looking for a solid retirement.

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Adam Palasciano

Adam Palasciano is a personal finance-obsessed and money-savvy individual who loves to hash out content on all things saving money. He specializes in writing millennial-friendly personal finance content, covering topics ranging from trending financial news, debt, credit cards, cryptocurrency, and more.