NEW YORK (MainStreet) The U.S. barely maintained a top 20 ranking in the world in meeting retirement security and needs ¬ finishing behind many European countries with stronger social programs and private pension systems.
For the second year in a row, the U.S. ranked 19th, according to a report from Natixis Global Asset Management, which ranked 150 countries based on health care, finances, economic well being and quality of life factors. The study noted while the U.S. is reaping benefits of an improvingdomestic economy, those positives are moderated by the potential for rising interest rates and inflation, as well as persistent income inequality.
"The responsibility for financial security in retirement is falling even more heavily on individuals than ever before and this trend is likely to continue as government resources become more scarce," said John Hailer, chief executive officer of Natixis in the Americas and Asia. "It is becoming increasingly apparent that to ensure financial security in retirement, individuals need to set personal goals and view planning and saving for retirement as a serious, conscious and strategic pursuit."
For overall retirement security, the U.S. remains behind the majority of countries in Western Europe and Canada, and ahead only of Israel on the list of the top 20 nations. Despite ranking sixth highest in per capita income, the U.S. ranks first in per capita healthcare expenditures, yet 33rd for life expectancy and a remarkable 81st for income inequality.
"There is no one-size-fits-all solution to this serious, growing retirement planning challenge," Hailer said. "The optimal pension system for any country depends on a variety of economic, social, cultural and political factors. However, the policies and practices adopted in some regions that rate highly could hold valuable lessons for other nations, such as the U.S., which need to shore up its retirement system."