The U.S. continues to lag other developed nations when it comes to ensuring retirement security, according to the 2019 Natixis Global Retirement Index.
In fact, the U.S dropped two spots to no.18 for retiree well-being, according to the annual index, which gives a snapshot of the well-being and financial security of retirees in 44 countries. And for all four indices measured, the U.S. ranked the same or lower, this year.
The Global Retirement Index, in its seventh year, incorporates 18 performance indicators, grouped into four thematic sub-indices, which cover key aspects for welfare in retirement: the material means to live comfortably in retirement; access to quality financial services to help preserve savings value and maximize income; access to quality health services; and a clean and safe environment. It used these criteria to calculate the relative performance for each of the 44 countries.
The U.S. held steady at 10th place in the Health category; it fell from 26th to 28th place for Material Wellbeing; dipped from 9th to 10th for Finances and it went from 19th to 20th in the Quality Of Life category.
And surprisingly, at a time when Americans are living longer, the report said the U.S. is experiencing a decline in life expectancy as Americans’ longevity failed to keep pace with top-ranked Japan and other nations.
The report noted that the U.S. remained in the top 10 in the health category because it improved in insured health expenditure, which measures the portion of that expenditure paid for by insurance, and by maintaining the highest score globally for per capita health spending.
As for the well-being, the U.S. has the eighth-worst score for income equality, even though it has the sixth-highest income per capita score among all the countries.
And although it has strong financial institutions, the U.S. lost ground in the finance category because of growing pressure on Social Security and Medicare funds. Rising government debt and tax pressures also contributed to the lower score.
And a lower score for happiness, which evaluates the quality of retirees’ current lives, weighed on the U.S.’s Quality of Life performance. Also, the U.S. did not show enough improvement in its environmental factors to move out of the bottom 10, the report noted.
The top three overall countries with the highest GRI score are Iceland, Switzerland and Norway. All three have consistently traded off finishing first in the overall ranking for the past three years, the report noted.
In terms of regions, North America has the highest overall GRI score at 72%, closely followed by Western Europe (70%) in second place. There is some distance between the dominant block of North America and Western Europe and the rest of the pack. The report pointed out that North America has a lower overall score this year due to declines in all four sub-indices.
But aided by the U.S. and Canada, North America again achieved the highest score for the Health and Finances sub-indices and ranks second in Material Wellbeing and Quality of Life, the report noted. The U.S. ranked first and third, respectively, for the health expenditure per capita and insured health expenditure indicators, while Canada finished at the top in life expectancy. Both countries also performed strongly in the Finances sub-index, racking up multiple top 10 indicator finishes, the report showed.
Western Europe continued its dominance, with 15 countries featuring in the top 25 for the third successive year. The Nordic countries maintained a strong showing in the top 10 with Iceland leading the way at No.1, Norway (No. 3), Sweden (No. 6) and Denmark (No. 7).
Asia Pacific and Eastern Europe both have four nations in the top 25 countries in 2019 GRI, while North America claimed two. No Latin American country made it in the top 25.