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The top 10 countries in the world for retirement security: Where does the US rank?

As the years pass, saving enough for retirement in the US is becoming harder. Where do retirees live the best?

PIA and how it affects your retirement benefits

In the US, a retiree’s average social security check in August was $1,840.27. For some retirees, these incomes are supplemented by pensions (56 percent) and private retirement accounts like Roth IRAs or a 401(k) (42 percent). Even with public and private options, poverty impacts around one in every ten seniors, highlighting the challenges many older generations face when they exit the workforce.

Even with public and private options, poverty impacts around one in every five seniors, underscoring the challenges many older generations face when they exit the workforce. The average for all OECD countries is 13.1 percent.

To compare the retirement security of workers in the US, we looked at four different variables: the poverty rate for seniors, the average age of retirement, the average number of years spent in retirement, the average, and the retirement savings programs (public and private) available to the average worker.

Best countries to retire

The percentage of the senior population living in poverty is one way to evaluate the security of workers savings for retirement. Though workers may stay in the workforce for more years to keep poverty rates among older generations down, lower poverty levels mean that, overall, older generations tend to live more comfortably. Countries with robust social welfare systems, like Denmark (3 percent), Iceland (3.1 percent), The Netherlands (3.1 percent), and Norway (4.3 percent), recorded the lowest rates in 2020.

Countries with the lowest senior poverty rates

Ranking  Country Povety Rate (+65) 
1 Denamark  3
2 Iceland 3.1
3 The Netherlands 3.1
4 Norway 4.3
5 France 4.4
6 Hungary 4.9
7 Slovak Republic 5
8 Luxemberg 7.1
9 Finland  7.2
10 Ireland  7.4
Source: OECD

Of all OECD countries, the US has the seventh-highest percentage of seniors living in poverty. The organization measures poverty as fifty percent of the country’s median income (roughly $15,000 in the US). However, other domestic organizations like the National Council on Aging reported that in 2022, around a third of all seniors lived in poverty on incomes below 200 percent of the federal poverty line of $27,180.

Countries with the highest senior poverty rates

Ranking Country Poverty Rate (+65)
1 South Korea  43.4
2 Latvia 39
3 Estonia  37.6
4 Mexico 26.6
5 Lithuania 25.2
6 Australia  23.7
7 United States 23.1
8 Israel  20.6
9 Japan 20
10 Chile  17.6
Source: OECD

 

Even countries like Ireland (7.2 percent), Spain (10.2 percent), and Italy (11.3 percent), where average GDP per capita is lower than the US, all experience lower levels of senior poverty.

At what age do most workers retire?

Of the thirty-eight countries in the OECD, twenty-eight countries have retirement ages that differ between men and women. At sixty-seven, the US has the highest retirement age.

Retirement age in OECD

Rank Country  Average retirement age 
1 Australia  50.5
2 Belgium 59.5
3 Austria  60.9
4 Canada  62
5 Chile  62
6 Colombia  62
7 Costa Rica  62
8 Czech Republic 62
9 Israel 62.5
10 Netherlands 62.5
Source: OECD 

In terms of the age at which the average worker retires, the US ranks twenty-seventh at 63.6 years. Interestingly, in Denmark, where poverty is low among seniors, workers tend to exit the labor force around sixty-four. However, because life expectancy in Denmark is higher than that of the US, workers tend to enjoy their retirement for roughly twenty-two years.

Living after retirement

Another factor to look at is how long retirees live after they leave the workforce. On this indicator, the US, at twenty-two years, ranks tenth in the world.

Nevertheless, the quality of life one has is crucial to measure, and with so many seniors in the US living in poverty, this phase of life can be full of many challenges. At the end of the day, retirement security is judged on how seniors fare financially. Although systems are in place to help workers save for retirement in the US, the fact that so many are unable to put away enough cash to avoid living in poverty highlights the insecurity that many face.