UK climbs three spots in global ranking on retirement security

Natixis IM Global Retirement Index says UK performance has improved in a range of areas

Jonathan Stapleton
clock • 3 min read
The UK climbed up three spots in the ranking
Image:

The UK climbed up three spots in the ranking

Retirement security has jumped for the first time in five years, climbing three spots in Natixis Investment Managers' 2023 Global Retirement Index (GRI) rankings.

The Natixis report showed the UK had climbed up three spots in the ranking to 16th with an overall score of 73% - well ahead of the US and France, who had scores of 71% and 69% respectively, but behind countries such as Norway (83%), Switzerland (82%), Iceland (81%) and Ireland (80%) who led the table.

The investment manager's global retirement index assesses factors that drive retirement security across 44 countries where retirement is a pressing social and economic issue. It was compiled by Natixis Investment Managers with support from CoreData Research.

A screenshot of a computerDescription automatically generated

Natixis said the UK's positive score was primarily fuelled by strong performance in its finances in retirement sub-index - noting the country had leapt fourteen places to 15th in that category following improvements in tax pressure and government indebtedness indicators.

It said the UK's positive score was also boosted by a significantly higher ranking on the interest rates indicator after the UK's central bank implemented a series of rate hikes to tame runaway inflation.

Despite this, the UK fell four places to 11th in the quality-of-life sub-index - ranking lower in air quality, happiness as well as biodiversity and habitat.

Natixis said nearly all developed countries in the index improved - adding only Portugal, Spain and Japan saw decreases.

It said Norway, Switzerland, and Luxembourg were the only nations to rank in the top ten in each of the four sub-indices. Natixis added that Germany's entrance to the top ten is the result of significant improvements in the finances in retirement and material wellbeing sub-indices.

Retirement worries

Despite an improving picture, additional individual investor research from Natixis IM revealed that optimism at the overall level was not being felt in the everyday lives of individuals, who remain concerned about retirement.

While nearly three quarters (73%) of individual investors with over $100,000 (£80,061) in investable assets in the UK feel positive about their finances, 60% say inflation is a major investment concern, and 53% say it is significantly impacting the ability to save for retirement.

The survey also found that while 56% globally think they will have the freedom to do what they want when they want in retirement, 48% worry "it would take a miracle" for them to retire securely, 28% believe they will have no choice but to live frugally, and 21% think they will have to continue working.

Natixis Investment Managers executive managing director and head of Northern Europe & MENA Andrew Benton said: "After a decade of low inflation and double-digit investment returns from equities, many individuals have had unrealistic expectations. However, the past year has been a reality check and arguably a reset of these expectations.

"Saving alone won't allow most people to reach their retirement goals, and so investing and working with professionals are important steps to achieving financial security in retirement. While retirement security has improved globally and, in the UK, individuals need to set realistic goals and maximize the opportunities to save, no matter how far away retirement may seem."

 

More on Pensions

Compulsion and choice: Lessons from the Aussie pension system

Compulsion and choice: Lessons from the Aussie pension system

In his latest article for Professional Adviser, Roger Brosch explores what the ‘super’ Down Under means for pensions up here

Roger Brosch
clock 10 July 2024 • 4 min read
Whichever political party wins on 4 July pensions need reform

Whichever political party wins on 4 July pensions need reform

A more bold and ambitious vision will be required

Jonathan Hawkins
clock 02 July 2024 • 5 min read
Why it's time to shout louder about third-party pension contributions

Why it's time to shout louder about third-party pension contributions

Despite all the noise around pensions, engagement is still deafeningly silent

Laura Barnes
clock 02 July 2024 • 4 min read

In-depth

The Adviser Incubator: Meet graduate Rebecca Penny

The Adviser Incubator: Meet graduate Rebecca Penny

An inside look at The Verve Foundation’s programme

Hope Coumbe
clock 12 July 2024 • 6 min read
Navigating a digital minefield: Advisers on dealing with fraud

Navigating a digital minefield: Advisers on dealing with fraud

With fraud on the rise, IFAs share how they are combatting the threat

Sahar Nazir
clock 11 July 2024 • 7 min read
PA Awards 2025: Nominations for all categories now open!

PA Awards 2025: Nominations for all categories now open!

Our 20th anniversary awards will be held in London next March

Professional Adviser
clock 10 July 2024 • 2 min read