Australia has been named as one of the top 10 countries in the world for overall retirement wellbeing but its global ranking dropped three places to ninth place overall, according to a global investment manager.
The rankings were released by Natixis Investment Managers as part of its 2019 Global Retirement Index (GRI) which assess 44 countries on a number of factors that create retirement security and are used as an indicator of the attractiveness of a country’s retirement environment.
Natixis highlighted that Australia’s compulsory superannuation system, which created positive outcome for retirees, was central to its high ranking as were high scores in the areas of interest rates and bank nonperforming loans, which it noted where signs of strong financial system.
Other areas to record an increase where the Health sub-index, which measures life expectancy, health expenditure per capita, and non-insured health, where Australia was ranked 11th overall and seventh for life expectancy.
Australia, however, slipped to 15th place in the Quality of Life, compared to ninth two years ago, and fell from 21st to 24th place in the area of Material Wellbeing, which measures income equality, income per capita and unemployment.
Natixis Investment Managers chief executive for Australia Damon Hambly said: “Australia’s superannuation system is the envy of many other countries and provides retirement security for Australians, but the fact is that most balances are too low, particularly given our ageing population, which is why our retirement age is set to increase to 67 in 2023. Along with Denmark, we are the first of a number of OECD countries to take this step – the United States and Spain are next in 2027.”
Despite the top 10 ranking, the analysis showed that when split between men and women, the latter faced a different set of circumstances compared with men when it comes to Material Wellbeing, due to the risk of outliving their assets in retirement.
Natixis noted this was caused by longer average life spans, lower levels of employment and discriminatory wage practices which resulted in women having less money saved for retirement.
Natixis Investment Managers managing director for Australia Louise Watson said: “If left unchecked, the different circumstances and barriers women face could potentially derail their retirement security.”
“Australian women retire with on average 47 per cent less superannuation than men yet they are likely to live five years longer so it’s really important that we work together as an industry to find ways of closing the gap.”
The ranking was released shortly after the government announced a review of Australia’s retirement income system following a recommendation from the Productivity Commission as part of its review of the superannuation system.
