The most generous pension plans in the world in these countries

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Portugal, the Netherlands and Iceland topped the ranking of financially sound pension systems, while the U.S. ranked 24th.

The Netherlands topped the latest Mercer CFA Institute Global Pension Systems Index released Tuesday, ranking first in the overall ranking of pension systems, followed by Iceland and Denmark. The rating of 47 pension schemes took into account indicators of adequacy, sustainability and reliability.

The adequacy index

The adequacy index, which accounts for 40% of the overall index, takes into account benefits, system design, savings, government support, home ownership and assets. The following chart shows the scores of this sub-index on a scale of 0 to 100 for the top 25 countries.

USA

The United States ranked 22nd overall with a grade of C+. A grade of C+ on the scale means "a system that has some positive features but also has serious risks and/or weaknesses that should be addressed; without these improvements, its effectiveness and/or long-term sustainability may be questioned." Many Americans are skeptical of the U.S. retirement system, which is funded primarily by savings in 401(k) and individual retirement accounts, as well as Social Security. While white-collar workers benefit, blue-collar workers and people in flexible jobs often struggle to save enough for retirement.

In general, Americans feel they are falling behind in their retirement plan and may be forced to postpone it due to financial hardship. According to a recent Bankrate survey, 56% of Americans believe they are behind in saving for retirement, and about a quarter say they haven't contributed to retirement in at least a year.

Portugal

Portugal, which topped Mercer's list, also ranked second in a ranking of the best countries for a comfortable retirement from U.S. News & The retirement age in Portugal is 66 years and 7 months, to be reduced by three months this year. Data from Numbeo showed that the cost of living in Portugal, excluding rent, is 29% lower than in the US. The healthcare system in Portugal is considered excellent and there are also golden visas that can be obtained by purchasing real estate worth 500,000 euros or investing 500,000 euros in scientific research.

Netherlands

In the Netherlands, in turn, all employees are required to have private and public pension accounts. The state pension starts at age 66. Although prices in the Netherlands are about 10 percent higher than in the U.S., excluding rent, the country has universal health care and its pension structure, according to the report, can "continue to provide very good benefits, supported by a strong asset base and very robust regulation. "

Island

Island, ranked third for adequacy and second overall, has both a basic state pension and a supplementary pension with a retirement age of 67. Iceland provides universal healthcare to its residents, and renting here is relatively inexpensive, according to SmartAsset.

Correction: October 19, 2023 - A previous version of this article incorrectly listed the second best country in the overall ranking.