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1、Danger Zone2022 NATIXIS GLOBAL RETIREMENT INDEXGlobal retirement security challenges come home to roost in 2022Table of ContentsFrameworkThe Best Performers Spotlight:GRIs biggest movers:a ten-year retrospectiveRegional PerspectivePerformance by Sub-IndexHealth Index Spotlight:Ukrainian refugees cou
2、ld improve Polish demographic issuesMaterial Wellbeing Index Spotlight:Inflation improving debt-to-GDP ratios?First impressions could be misleadingFinances in Retirement Index Spotlight:The pandemics lasting impact on the US labor marketQuality of Life IndexThe Top 25:Year-on-Year TrendsCountry Repo
3、rtsReferencesFrameworkAppendix A Methodology Constructing the Indicators Constructing the Global Retirement IndexAppendix B:Full Rankings1516 1719 23436384042686970707074753Ten years of the Global Retirement Index2Global retirement security challenges come home to roost in 2022Global Reti
4、rement Index 20222Global Retirement Index 2022Ten years of the Global Retirement IndexWhen we introduced the Natixis Global Retirement Index in 2012,the world had just emerged from the global financial crisis:Memories of market turmoil were still fresh.Inflation was low,but so was growth.Central ban
5、ks had slashed interest rates to all-time lows.Balance sheets had ballooned from asset repurchase programs.And public debt had swelled to record highs around the globe.On top of it all,the first wave of the Baby Boom generation had just reached retirement age,indicating that pay-as-you-go retirement
6、 systems around the world would soon face a stress test like no other.It all raised the question of whether the models for those systems would be sustainable in the long term.The time was right to examine retirement security from a global perspective.Working in collaboration with CoreData Research,N
7、atixis Investment Managers sought to identify,measure,and track the key factors that would determine if individuals around the world would be able to live with dignity in the years after work.As an investment management company,we knew finances would factor greatly into retirement security.After all
8、,the discussion often focuses on saving for retirement and generating an income in retirement.But we also recognized that like many sustainability issues,retirement security was a more complex,multi-dimensional topic.So the index went beyond interest rates,savings rates,and inflation.People are livi
9、ng longer,and with age comes increased need for medical care.So the index considers health factors alongside finances.To ensure their finances hold up,the index considers key economic indicators that examine material wellbeing.And because retirees need to live in a clean,safe environment,the index c
10、onsiders quality of life.In 2022,the world finds itself recovering from another global crisis.Inflation is running at levels not seen since the 1980s.Balance sheets and debt levels have soared even higher.Central bankers again are turning to interest rates as a stopgap,only this time theyre raising
11、rates.After a decade-long bull run,the markets are more volatile,with indexes and investors around the world experiencing losses.The Boomer retirement wave is at its crest,and the Millennial generation is making its presence known in the workforce.As the global economy evolves,the Natixis Global Ret
12、irement Index still meets its clear objective:to provide policy makers,employers and the public at large with a comparative tool for seeing where the factors are best aligned to ensure a secure retirement.3Global Retirement Index 2022The warning signals are blaring and the gauges are flashing bright
13、 red in 2022 as key risk concerns for retirement security are coming to a head in todays rapidly changing economic environment.Inflation,the long-sleeping giant among financial woes for retirees,has been riled up in the jet wash of a global pandemic and war in Ukraine.Skyrocketing prices for oil,foo
14、d and shelter are taking a dramatic bite out of the purchasing power of retirees and presenting a core economic lesson to those still planning for life after work.A bad year to retireBut even while inflation is running at its highest level in 40 years,it is just one factor on a growing list of conce
15、rns.Given all the potential pitfalls,2022 could be one of the worst years to retire in recent memory.With markets down,rates still relatively low,and inflation taking a big bite out of retirees wallets,those who step out of the working world run the risk of taking retirement distributions from an al
16、ready depleted pool of assets.At the same time,its likely they will have to take greater risks with their portfolio to make up ground theyve already lost.Both will make it hard to preserve retirement savings and make it harder to attain a secure retirement,but with 20 years ahead in retirement,there
17、 is still time for 2022s retirees to reset their plans.Where retirement plans can go wrongHow much does inflation factor into retirement security?Financial professionals around the world say underestimating the impact of inflation is the number one mistake investors make in their retirement planning
18、,according to the 2022 Natixis Global Survey of Financial Professionals.Perhaps more than any other factor,it has the potential to upset the plans that have taken decades for millions of people to realize by simply eroding the value of what theyve worked so hard to accumulate.But inflation is just t
19、he starting point of a long list of potential mistakes that individuals can make in their retirement plans.From underestimating how long they will live to forgetting to factor in healthcare costs.From overestimating investment income to relying too much on public benefits.And a range of other mistak
20、es underscore just how hard it can be to get it right.Familiar issues.New risks.The risks to global retirement security were clear when we first published the Natixis Global Retirement Index in 2012:aging populations,pension funding shortfalls,and an uncertain economic environment.Those core issues
21、remain the same ten years later,but after a decade of increasing pressure they are presenting some new risks in 2022:Inflation:an immediate threat to retirement security Rapidly escalating costs can pose a significant threat to the financial security of retirees by eroding purchasing power.Instituti
22、onal investors will be challenged to preserve assets in a more volatile investment environment.Interest rates and income:long-term gains,short-term pain After a decade of historically low interest rates,central bank rate hikes hold promise for annuitizing assets in the long term,but not without some
23、 short-term pain for individual and institutional investors alike.Demographics:the good and bad of living longer For individuals,the longevity revolution will tax their income plans.For institutions,rapidly aging populations will test the limits of both pensions and government benefits systems.Getti
24、ng retirement security right and helping to ensure individuals can live with dignity after their working years is a core sustainability issue for society in the 21st century.Success will require a concerted effort from policy makers,employers,the financial services industry and individuals.It all st
25、arts with understanding the risks.Top 10 retirement planning mistakesUnderestimating the impact of inflation 49%Overestimating investment income 42%Setting unrealistic return expectations 40%Underestimating how long you will live 46%Being too conservative in investments 41%12435Forgetting to factor
26、in healthcare costs 39%Relying too much on public benefits 33%Being too aggressive in investments 21%Failing to understand income sources 35%Underestimating real estate costs 23%679810Global retirement security challenges come home to roost in 2022Source:Natixis Investment Managers,Global Survey of
27、Financial Professionals4Global Retirement Index 2022Inflation:an immediate threat to retirement securityA global pandemic,a disruption to the global supply chain,and a war in Ukraine are all linked as a series of world events that has delivered the highest level of inflation since the Reagan-Thatche
28、r era.While inflation is always a concern,the speed at which costs have ramped up gives reason to rethink fundamentals in retirement planning.For most of the past decade inflation has been exceptionally low.Between 2012 and 2020 inflation for 38 OECD member countries averaged just 1.76%.Supply chain
29、 disruptions helped inflation more than double to 4%in 2021,but even still,the decade average remains less than 2%(1.92%).Then came Russias war on Ukraine.In just the first half of the year,inflation for those same 38 countries spiked to 9.6%in May.2But inflation pains were not felt equally across r
30、etirees wallets.With a post-pandemic jump in demand for energy and the war in Ukraine driving scarcity,consumers have felt a powerful inflation effect at the gas pump.Inflation pains were not felt equally across retirees wallets.Source:OECDInflation has increased dramatically from 2012 to 2022 Franc
31、eGermanyItalyMexicoSpainUKUSAOECDJapanQ2 202220122.0%2.0%3.0%4.1%2.4%2.6%2.1%2.2%0.3%5.3%7.6%6.9%7.8%9.1%7.9%8.6%9.7%0.9%5Global Retirement Index 2022Pain at the pumpBetween 2012 and 2021 gasoline cost an average of$2.80 per gallon in the US,3 making a fill-up for a 15-gallon tank$42.While that may
32、still be a significant bill for someone living on a fixed income,it is more manageable than the$75 it cost in June 2022 when average pump prices hit$5.4 While prices have moderated,the point is clear:A 40%hike tallies up to a$1,700 increase in retirees expenses for just one tank a week.But its not j
33、ust at the pump that retirees are feeling the squeeze.July 20222021Rising gas costs put the squeeze on retirees in the last yearUSUKFRANCESPAINMEXICO$2.31$5.79$6.21$5.41$3.33$4.61$8.50$7.16$7.30$4.39Prices are USD per US gallonConsumers are getting less for their money at the grocery storeCOST FOR A
34、 MODERATE WEEKLY MEAL PLAN FOR TWO ADULTS(US)+$1,300 20172022$141$7,353 Annually$168$8,712 AnnuallyPain at the checkout lineFood prices have also spiked,and this jump can be even more detrimental to retirement security.In simple terms,you can always go without travel,but you cant go without food.Gro
35、cery prices had been relatively stable in recent years.Between 2017 and 2021 food inflation averaged about 3.6%across OECD countries.Even in that time,the US(-0.2%)and Canada(-1.0%)saw food prices actually decline in 2017.5 But the picture is much different in 2022.By June 2022,OECD reports that foo
36、d inflation spiked to 13.3%across member countries,including a 12.2%increase in the US,11.95%in Germany,and 9.8%in the UK.Even Japan,where food inflation had been less than 1%in four of the five previous years,saw food prices jump 4.11%.6 In practical terms this translates into a significant increas
37、e in grocery bills.For example,USDAs estimated costs for a moderate weekly meal plan for two adults increased from$141.40 in 2017 to$167.53 in 2022.7 It all adds up to another$1,300 annually.For those on a fixed income an extra$3,000 for food and fuel can have a dramatic impact on quality of life.Fo
38、r those on a fixed income an extra$3,000 for food and fuel can have a dramatic impact on quality of life.Sources:Statista,GlobalPetrolPSource:USDA 6Global Retirement Index 2022Social Security orders up a COLAPolicymakers have a key tool at their disposal to help mitigate the impact of inflation on p
39、ensioners the Cost of Living Adjustment.In the US,low inflation has meant Social Security beneficiaries had received an average adjustment of just 1.32%between 2012 and 2021.The good news was that the COLA was increased to 5.9%in December of 2021.8 Unfortunately,inflation has reached much higher lev
40、els and expenses are increasing.For example,rising prescription drug benefit premiums in general,and for Alzheimer medication Aduhelm in particular,have resulted in a one-time increase in Medicare Part B monthly premiums from$148 to$1709 in 2022.Reduced pricing for the drug will result in significan
41、t cost savings,and as a result,premium payments are expected to decrease in 2023.The good and the bad of inflation for institutionsWhile inflation has a negative impact on individuals,certain institutions may find an indirect benefit.Pensions generally make out better in inflationary times as centra
42、l banks implement interest rate hikes to curb inflation.This is because of the seesaw effect that rates have on pension liabilities.In simplest terms:The higher the rate,the lower the liabilities.Heres how it works.All pensions calculate their future liabilities,or payments that will be made to memb
43、ers for decades into the future.But they are required to calculate the sum of what they will pay members over time using present-day dollars.When rates are low,liabilities look a lot larger.Thats because the low rates mean the future income from any bonds managers hold will be low as well.When rates
44、 rise,the future income of those holdings is greater.As a result,pensions will receive a higher level of income.Now with rates increasing,liabilities are shrinking for many.But not all pensions respond in equal measure.The math on inflation ultimately works out to the better for private pensions.Wit
45、h inflation driving rates up and liabilities down,these managers generally see their contribution rate decline.On the public side of pensions,the math may not be as advantageous.Two key differences for public and private pensionsTwo other factors add significantly to the challenge for public pension
46、s:First,most private pensions are closed to new members as employers have shifted retirement plans from defined benefit pensions to defined contribution plans,so fewer and fewer people will receive pension payments.Most public pensions remain open to new members.In the simplest terms,getting new mem
47、bers means they will need more money to pay more members and their payments will have to stretch out over a longer,indefinite period of time.Second,many public plans also include a cost of living adjustment which makes liabilities more variable over the long term.Ultimately,inflation is not just the
48、 apex of retirement security threats;it is also the trigger for another key challenge facing individuals and institutions:rising interest rates.Interest RatesPension LiabilitiesRate hikes mean that institutions have the potential for greater income in the future,which makes todays liabilities lower.
49、WHEN RATES RISE,PENSION LIABILITIES FALL7Global Retirement Index 2022Low interest rates have been the bane of retirement security for well over a decade.Beginning with the cuts implemented during the global financial crisis,interest rates stayed at historic lows for more than a decade.But now in the
50、 inflationary post-pandemic economy,central banks have begun to raise rates in earnest.While that is good news in the long term,it will not be without some short-term pain.In the US,the fed funds rate had dropped to 0.7%in 2011 and stayed well below historic averages until 2016 when a series of smal
51、l rate hikes began to suggest a return to the norm.Then came the global pandemic and rates were slashed to 0.05%in April 2020.Two years later,as inflation has spiked,the Fed has responded by hiking rates by 75 basis points,first in June and then again in July.10 In Europe,a series of cuts by the ECB
52、 took rates down to 0%in 2012.By 2014 rates were into negative territory,where they stayed for the next eight years.It wasnt until July of 2022,when bankers in Europe implemented a 50bps hike,that rates even got back to zero.11 Similarly,rates in the UK have remained low,not topping 1%since 2009.Cov
53、id and the threat of recession brought about cuts that brought the Bank of England rate to a 300-year low of 0.1%in March of 2020.12 Two-plus years later,rates were increased to 1.25%in June 2022.Elsewhere,the German Bund rose to 0.5%in July 2022 after going to 0%during the pandemic.Australia hiked
54、rates from 0.85%to 1.35%the same month.In Japan,where they have been steadying the economy against stagflation since the 90s,the Bank of Japan has continued its negative rate policy,maintaining the-0.1%rate thats been in place since 2016.13 Interest rates and income:long-term gains,short-term pain1.
55、582.50%1.75%1.25%0.25%0.15%1.75%0.25%-0.50%0.0%-0.50%-0.50%0.25%Federal ReserveECBBank of England8/11/20226/30/202212/31/202112/31/2020CENTRAL BANK RATES HAVE INCREASED SUBSTANTIALLY IN THE LAST TWO YEARSSource:Bloomberg8Global Retirement Index 2022The good and the bad of ratesThere are a lot of adv
56、antages to living in a low-interest-rate world.Low rates helped propel global growth from$75 trillion to$104 trillion14 over the past decade.Theyve helped drive equity markets to record highs,helped business grow,and helped individuals attain homeownership.Those investing for retirement most certain
57、ly benefited from the boon,but low rates have not helped retirees in equal measure.In fact,low rates have presented retirees with some difficult choices.In the simplest terms,low rates have made it hard for retirees to generate income off their savings.With rates in low to negative territory,many we
58、re not able to follow the golden rule of“Never touch the principal.”Instead of waiting for bonds to throw off a sustainable income,retirees were forced to dip into the principal of their nest egg when they might normally seek to preserve their capital.This puts them in the difficult position of lowe
59、ring their expected income,accepting that their assets may run out too early,or taking on more investment risk to make up the difference.Each decision takes on heavier consequences in 2022s volatile markets.Risks at every turn for retireesWith inflation running at a 40-year high,those on a fixed inc
60、ome will already find it difficult to keep pace with rising costs,let alone find room to cut their income.Longevity adds to the challenge.People may be living longer,but nobody knows how long they will live.As a result,theres a crucial piece missing to the equation that tells you how much income you
61、 can take from your savings while ensuring it will last the rest of your life.And as markets have shown in 2022,equity markets do not operate in a vacuum.Economic surprises like an inflationary spike,slow growth,and recession can lead to a swift market downturn,further complicating their ability to
62、preserve capital while taking income.Bonds also experiencing turbulenceIn the long run,retirees may gain some hope for higher income in the future,but not without some pain along the way as markets weather the change.Unfortunately,few investors may understand what rising rates hold in store for them
63、.In 2019,the Natixis Center for Investor Insight conducted a quiz with 9,000 investors in 27 countries.We asked them what two things happen when rates go up.They werent sure.Professionals may recognize that with rising rates theres a greater chance for higher income in the future,but that the presen
64、t value of the bonds you currently own goes down.Only 3%of investors worldwide understood both sides of the equation.One-third didnt understand either.15 of investors from our Survey of Individual Investors understand how rates affect bonds.Higher rates decrease the present value of the bond.1Higher
65、 rates today mean bonds will generate higher income down the road.2MANY INVESTORS DONT UNDERSTAND HOW RISING RATES AFFECT BONDS3%Source:Natixis Investment Managers,Global Survey of Individual Investors9Global Retirement Index 2022Bond yields have hovered around historic lows for more than a decade,w
66、hich has put income-oriented investors at a disadvantage.Now with rates ratcheting up,they are feeling even more pain as US government bond values have plummeted-10.41%as of June 30,2022 according to the ICE BofA 7-10 Year Treasury Index,setting the stage for their worst calendar performance year si
67、nce the index began in 1973.German government bonds are down-11.39%and Eurozone government bonds are down-12.44%in the same time frame which is shaping up to the worst year on the continent since the ICE BofA Index data began in 1986.16Funding ratios still troubled by volatile marketIts not just ind
68、ividuals who are faced with interest rate challenges.The success and health of public and private pensions is directly linked to interest rate policy.Not only do rates affect pension funding ratios,but the knock-on effects can affect their overall investment performance.Rising rates foretell higher
69、yields for bonds in the future.For pensions that estimate their liabilities using current rates,higher rates demonstrate a greater ability to make payments to members decades in the future.Improved funding ratios are positive for pension managers,but they will also feel the effects of any downturns
70、that may come from reactions to rate hikes.For example,pension managers might have breathed a sigh of relief at the start of 2022.Even with rates at pandemic lows,they had seen some recent improvement in funding ratios.They also benefited from the bull market in which the S&P 500 delivered about 40%
71、over 2021 and 2022.As a result of the boon,OECD reports that member countries had seen pension assets rise by an average of 8%in 2021.17 At the high end of pension fund performance,New Zealand saw assets grow by 19%.Australia(18%),Iceland(17.9%),France(16.6%)and Mexico(11.2%)all followed suit with d
72、ouble-digit gains.But the relief didnt last long.18 In the US,pensions delivered 11.6%in 2021,and funding ratios had climbed above 80%for the first time since 2008.19 But the storyline has flipped in 2022.Equitable reports that with average losses of-10.4%20 in the first half of 2022,the funded stat
73、us for state and local pensions has experienced the sharpest decline in funding ratio since the global financial crisis,dropping from 84.8%on average to 77.9%.21 Topping it off,the National Association of State Retirement Administrators average assumed rate of return for its US members has dropped b
74、elow 7%to 6.9%.22 Interest rates have been a challenge to global retirement security for more than a decade.Now,with central banks implementing rate hikes to counter inflationary pressures,individuals and institutions will find the hope for higher income and improved funding ratios in the long run.B
75、ut the ancillary effects of rate increases can result in a lot of pain in the here and now.77.9%20212022Pensions saw gains of 11.6%Funding ratios were above 84.8%Pensions had average losses of-10.4%Funding ratios have dropped to 77.9%A REVERSAL OF FORTUNE FOR PENSION PLANS IN 2022Sources:Pew Charita
76、ble Trust;Equable Institute10Global Retirement Index 2022Its no secret that the population in Japan,Europe and the US has been aging.The drumbeat of concern has been loud and clear since statisticians first realized that the massive post-World War II Baby Boom generation would eventually enter their
77、 60s and that wave would put a strain on retirement systems.In 2012,the earliest wave of the Baby Boom generation was just reaching retirement age as the 2.1 million individuals born in the US in 194623 inched closer to age 66.Since then,the number of people age 65+in the US has grown to 16%24 of a
78、population of 331 million.In Europe,that population represents an even bigger piece of the pie at 20.8%of the 750 million EU residents.The number is bigger still in Italy(23.5%),Finland(22.7%),Greece(22.5%),and Portugal(22.4%).25 Japan has been at the vanguard of the silver wave sweeping the global
79、population.Already 12%in 1990,the countrys 65-plus population has more than doubled and continues to gain momentum.It took ten years for that share to reach 17%in 2000.It reached 22%in 2010,and 28%in 2020.26 Challenges ahead for younger countries,tooEven regions with young populations could soon fac
80、e similar challenges as improved nutrition,healthcare and environmental factors contribute to longevity and low birth rates help push the overall population ever older.This is the case in both China and Latin America in 2022.Along with other longevity factors,China is also grappling with the repercu
81、ssions from its one-child policy,which capped population growth for decades.As a result,the UN estimates that by 2050,the 65-plus population will reach 366 million people,surpassing todays total US population.Over the next three decades,the share of people in the cohort will more than double from to
82、days 12%to 26%.27 As a result,policy makers there announced plans to gradually increase the retirement age from the current 60 for men,50 for blue-collar women and 55 for white-collar women over the next five years.28 In Latin America,where the 65-plus population is expected to reach 18%by 2050,the
83、overall impact will not be as great,but some countries will be facing significant challenges.For example,Chile and Uruguay are among four countries where it is expected that by 2050 there will be only two working age adults for every person over 65.Demographics:the good and bad of living longerTHE P
84、ERCENTAGE OF THE POPULATION OVER 65 IS GROWINGAustralia2012 14%2021 17%Japan2012 24%2021 29%UK2012 17%2021 19%France2012 17%2021 21%Italy24%Spain20%China2012 8.5%2021 12%Germany2012 21%2021 22%Mexico2012 6%2021 8%US2012 14%2021 17%Chile2012 10%2021 12.5%Source:OECDItaly2012 21%2021 24%Spain2012 17.5
85、%2021 20%11Global Retirement Index 2022Older for longerAdding to the sheer volume of individuals who would be entering retirement is how long they will live after they retire.OECD reports that the average life expectancy past age 65 in G20 countries reached 21.3 years for women and 18.1 years for me
86、n between 2015 and 2020.And while the gains in lifespans past 65 have slowed slightly since 2010,the average for women past 65 in these countries will reach 25.2 between 2060 and 2065,while it will increase to 22.5 for men.29 As a result of increased life expectancy and slowing fertility rates,OECD
87、projects the over-65 population to increase from 2019s 17.3%to 26.7%by 2050.The percentage will be even higher in older countries.OECD estimates that this share of population will surpass 30%by 2050 in Greece,Italy,Japan,Korea,and Portugal.30 Population growth doesnt add up to retirement securityThi
88、s is where math becomes most concerning for policy makers.A larger population that will live longer breaks the formula behind most pay-as-you-go retirement systems.Many of these systems,like Social Security in the US,use payroll taxes to fund government retirement benefits.What makes them work is th
89、e balance between the number of working age people and the number of retirees and others drawing benefits.The problem is best illustrated by old-age dependency ratio,which provides a simple statement on the number of retired people out of every 100 people within a population.For most of the develope
90、d world,that number has been climbing steadily higher for the past century.In 1950,just 15 years after its Social Security system was created,the US had an old-age dependency ratio of just 14.2%.Seventy years later it reached 28.4%.By 2050 the over-65 population in the US will reach 40.4%.But even w
91、ith four in ten Americans past retirement age,the challenge wont be as great as it is in other countries:Japans ratio has already grown from 9.9%in 1950 to todays 54%.In 30 years,its expected that 80.7%of the Japanese population will be 65+.Italy is projected to see its share of older people grow fr
92、om 39.5%in 2020 to nearly three-quarters(74.4%)by 2050.Germanys will rise from 36.5%in 2020 to 58.1%in 2050.Frances will grow from 37.3%in 2020 to 54.5%in 2050.A similar trend shows up in the perennial top three countries in the Natixis Global Retirement Index.Iceland will see its old-age dependency
93、 increase from 26.6%to 46.2%,Switzerlands will go from 31.3%to 54.4%,and Norways will rise from 29.6%to 43.4.%.31 OLD-AGE DEPENDENCY IS HIGH AND WILL SKYROCKET BY 205020202050China18.547.5Chile19.744.6US28.440.4UK32.047.1Spain32.878.4Mexico13.228.9Japan52.080.7Italy39.574.4Germany36.558.1France37.35
94、4.5Canada29.844.9Australia27.741.6Source:OECD12Global Retirement Index 2022Limited options for policy makersAging populations present limited choices for policy makers choices that will be difficult as retirement benefits compete with a growing public debt burden.The debt to GDP ratio for OECD count
95、ries reached a record high of 95%in 2020,a figure thats 73%greater than it was in 2007,before the Global Financial Crisis.32Down the road,policy makers could be forced into one of three tough decisions,none of which are real vote-getters.To make up for funding shortfalls they may need to:1.Raise pay
96、roll taxes:Hiking taxes is never popular and will be even less so should inflation continue to reduce consumer purchasing power as its done in 2021 and 2022.2.Raise the retirement age:Telling people they have to work longer than planned is an unenviable position.In 2020,French workers took to the st
97、reets to protest a proposed retirement age increase from 62 to 64.And in 2021,Swiss workers marched in Bern to protest retirement reforms including a proposed hike in the retirement age for women from 64 to 65.3.Reduce benefits:Maybe the least popular option,reducing benefits is not only a political
98、 loser,its also an economic nightmare for retirees,especially during inflationary periods when their dollars dont go as far to begin with.Aging also presents a critical healthcare challenge for both policy makers and retirees themselves.Growing elderly populations will put additional strains on heal
99、thcare and long-term care systems.For example,in the US,where health expenditures already account for nearly 19%of GDP,33 those age 55 and older accounted for 56%of healthcare spending in 2019.Those 65 and older accounted for 35%on their own.34 Rising costs are not limited to the US.The World Health
100、 Organization reports that global healthcare spending topped$8.5 trillion in 2019 twice the$4.2 spent globally in 2000.An older population can also translate into a slower economy.With large numbers of individuals leaving the workforce,OECD suggests that there could be significant economic consequen
101、ces.Growth could be impeded as“there will be less working-age people in the population,older workers tend to be employed less,and may be less productive and entrepreneurial.”In addition,OECD cautions that the cost of healthcare,pensions,and long-term care could become“unmanageable for many countries
102、.”36 Retire or keep working?For many individuals globally,the traditional view of retirement is fading.Many continue to work well beyond retirement age.In fact,results from the 2021 Natixis Global Survey of Individual Investors show that even as they plan to retire at age 62 on average,six in ten be
103、lieve they will have to work longer than they anticipated.This from a group of more than 8500 individuals who already has at least$100,000 in investable assets.37Whether by economic necessity or by choice,the silver workforce is growing.OECD reports that the highest rate of workers over age 65 can b
104、e found in Asia,47.6%in both South Korea and Japan.New Zealand also sees high labor participation among the same group,reporting 45%of those age 6569 continue to work.38 Eurostat reports that 20%of people age 55 or older were working,including the 48%of all men and 60%of women aged 65-plus in the EU
105、 who work part-time.39 While the numbers are smaller in the US today,the number of people age 65 and older still working is expected to grow from 24%of men and 16%of women in 2018 to 26%and 18%respectively in 2026.40 For many in the US,working in the flexible gig economy may provide an opportunity t
106、o augment their income beyond Social Security and savings.In fact,44%of workers aged 5564 and 37%of those age 65 and older say they are interested in gig economy jobs for extra money and flexibility.41Australia15.018.2Chile23.3Colombia3.5France7.5Germany25.6Japan23.9Mexico25.1New Zealand10.5UK18.9US
107、15.5OECD AveragePERCENTAGE OF THE POPULATION OVER 65 THAT IS STILL WORKINGSource:OECD 13Global Retirement Index 2022The factors that make 2022 one of the worst years to retire in recent memory inflation,interest rates,poor market performance could right themselves within a year or two.But the risks
108、will still be great.If we are to achieve retirement security,every stakeholder will have to do their part.Policy makersDemographics provide the most direct motivation for policy makers.Aging populations have the potential to weaken pay-as-you-go retirement systems.Smart policy will focus on setting
109、individuals up for success:Ensuring access to a workplace retirement savings plan is a crucial first step.Australia,New Zealand,Singapore and other countries have taken on the challenge with compulsory retirement savings programs.Incentives for employers as well as their employees are crucial.Tax in
110、centives and streamlined plan requirements are strategies for motivating businesses large and small to give employees the tools they need to fulfill their personal savings responsibilities.Education and advice on how to manage retirement assets is increasingly needed given todays complex financial c
111、hoices.In fact,62%of individuals surveyed in 2021 say they need professional advice in selecting investments from their workplace retirement plan.42 Retirement policy will need to adapt to a range of long-term economic and demographic changes.The focus as always will need to be on ensuring people ha
112、ve the opportunity to meet their responsibilities and goals.EmployersThere is no question that individuals are looking to employers for help.In fact,80%of individual investors surveyed in 2021 said they believe employers have a responsibility to help employees achieve retirement security.43 Providin
113、g access to an effective retirement savings plan is just the starting point:Participation is the foundation.Auto-enrollment is one of the key starting points to getting employees to save.Rather than waiting for workers to opt in on a company-sponsored plan,allow them to opt out if they choose not to
114、 participate.Similarly,allowing plan participation to begin on the first day of employment is another consideration.Incentives to increase savings rates.If an employer has any doubt about how much the match is valued by employees,just consider what investors told us.Eight in ten of those surveyed sa
115、id they would be more likely to work for a company that provides a match.The match can be a critical advantage in todays tight labor market.Employee engagement is needed to maximize the savings opportunity.Auto-escalation can help boost contribution rates by allowing employees to increase the size o
116、f their contribution annually.Investment choices also incentivize participation.Looking beyond saving,employers may even consider financial solutions that help participants navigate the complex process of drawing a sustainable income from their savings.Education is necessary.Employees need to unders
117、tand why they should save and how to make the most out of a company plan.Assuming the responsibility to save is a big ask of individuals.Its critical to ensure they are financially literate and ready to take on this important job.IndividualsEven if favorable retirement policies are set and employers
118、 provide access to a plan and the tools to maximize the opportunity,individuals need to act:Retirement saving needs to be a lifelong financial priority.Individuals have clear objectives for fulfilling their personal responsibility:Participation is essential.Its been said the best advice on saving fo
119、r retirement is to start as early as you can to maximize the number of years available to for saving.But even those individuals who start later in life benefit from saving,especially if there are incentives designed to help older workers increase their savings.Personal engagement:Individuals should
120、take the time to get familiar with the features and benefits of their employers.Take advantage of incentives like company match.Leverage tools like auto-escalation.Participate in educational opportunities.Go beyond the workplace plan.Many countries allow for personal retirement savings vehicles such
121、 as the UKs Individual Savings Account(ISA),Canadas Registered Retirement Savings Plan(RRSP),or Individual Retirement Accounts(IRAs)in the US.Making smart use of these opportunities can enhance savings levels dramatically.The key step toward achieving retirement security is to have a plan.Whether wo
122、rking with a financial professional or working with an online tool,individuals need goals and a road map to guide their savings and investment decisions.Retirement security:a shared responsibility14Global Retirement Index 2022Graphic sourcesPage 3:Natixis Investment Managers,Global Survey of Financi
123、al Professionals conducted by CoreData Research in March and April 2022.Survey included 2,700 respondents in 16 countries.Page 4:OECD(2022),Inflation(CPI)(indicator).doi:10.1787/eee82e6e-en(Accessed on 26 August 2022)Page 5:Compare The Market,Average gasoline prices in selected countries world-wide
124、in 2021(in U.S.dollars per liter)StatistaPage 5:Gasoline Prices around the World.GlobalPetrolPPage 5:USDA Food Plans:Cost of Food Reports(Monthly Reports).Food and Nutrition Service U.S.Department of Agriculture,https:/www.fns.usda.gov/cnpp/usda-food-plans-cost-food-reports-monthly-reports.Page 7:Bl
125、oombergPage 8:Natixis Investment Managers,Global Survey of Individual Investors con-ducted by CoreData Research,February-March 2019.Survey included 9,100 inves-tors from 25 countries.Page 9:The Pew Charitable Trusts,“The State Pension Funding Gap:Plans Have Stabilized in Wake of Pandemic”(2021),http
126、s:/www.pewtrusts.org/media/assets/2021/09/the_state_pension_funding_gap.pdf.Page 9:“The State of Pensions 2022.”Equable,https:/equable.org/wp-content/uploads/2022/07/Equable-Institute_State-of-Pensions-2022-Fact-Sheet_Final.pdf.Page 9:“Equable Institute:State of Pensions 2022.”Equable,https:/equable
127、.org/state-of-pensions-2022/.Page 10:OECD(2022),Elderly population(indicator).doi:10.1787/8d805ea1-en(Accessed on 11 August 2022)Page 11:OECD(2022),Old-age dependency ratio(indicator).doi:10.1787/e0255c98-en(Accessed on 11 August 2022)Page 12:OECD Statistics-Labor Force Participation.OECD,https:/sta
128、ts.oecd.org/Index.aspx?DataSetCode=AVE_HRS).Footnotes 1.Natixis Investment Managers,Global Survey of Financial Professionals conduct-ed by CoreData Research in March and April 2022.Survey included 2,700 respon-dents in 16 countries.2.“Consumer Prices,OECD-Updated:5 July 2022.”OECD,https:/www.oecd.or
129、g/newsroom/consumer-prices-oecd-updated-5-july-2022.htm.3.“PETROLEUM&OTHER LIQUIDS.”U.S.Regular All Formulations Retail Gasoline Prices(Dollars per Gallon),https:/www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=EMM_EPMR_PTE_NUS_DPG&f=A.4.Edmonds,Ellen.“National Average Hits New All-Time H
130、igh at$5 per Gallon.”AAA Newsroom,13 June 2022,https:/ on 08 August 2022)6.OECD(2022),Inflation(CPI)(indicator).doi:10.1787/eee82e6e-en(Accessed on 26 August 2022)7.USDA Food Plans:Cost of Food Reports(Monthly Reports).Food and Nutrition Service U.S.Department of Agriculture,https:/www.fns.usda.gov/
131、cnpp/usda-food-plans-cost-food-reports-monthly-reports.8.“Social Security.”Latest Cost-of-Living Adjustment,https:/www.ssa.gov/oact/cola/latestCOLA.html.9.“Press Release CMS Releases Analysis on 2022 Medicare Part B Premium Reexamination.”CMS,https:/www.cms.gov/newsroom/press-releases/cms-releases-a
132、nalysis-2022-medicare-part-b-premium-reexamination.10.“Federal Funds Effective Rate.”FRED,n.d.,https:/fred.stlouisfed.org/series/FEDFUNDS.11.“Key ECB Interest Rates.”European Central Bank,https:/www.ecb.europa.eu/stats/policy_and_exchange_rates/key_ecb_interest_rates/html/index.en.html.12.United Kin
133、gdom Interest Rate.”United Kingdom Interest Rate-2022 Data-1971-2021 Historical-2023 Forecast,https:/ Rate.”Interest Rate-Countries-List,TRADING ECONOMICS,https:/ Gross Domestic Product(Gdp)at Current Prices from 1985 to 2027(in Billion U.S.Dollars).Statista,Statista Inc.,19 Apr 2022,https:/ Investm
134、ent Managers,Global Survey of Individual Investors conducted by CoreData Research,February-March 2019.Survey included 9,100 investors from 25 countries.16.Bloomberg17.“Pension Markets in Focus.”OECD,https:/www.oecd.org/finance/private-pensions/pensionmarketsinfocus.htm.18.Pension Markets in Focus-OE
135、CD.OECD,https:/www.oecd.org/daf/fin/private-pensions/Pension-Markets-in-Focus-Preliminary-2021-Data-on-Pension-Funds.pdf.19.The Pew Charitable Trusts,“The State Pension Funding Gap:Plans Have Stabilized in Wake of Pandemic”(2021),https:/www.pewtrusts.org/media/assets/2021/09/the_state_pension_fundin
136、g_gap.pdf.20.“The State of Pensions 2022.”Equable,https:/equable.org/wp-content/uploads/2022/07/Equable-Institute_State-of-Pensions-2022-Fact-Sheet_Final.pdf.21.“Equable Institute:State of Pensions 2022.”Equable,https:/equable.org/state-of-pensions-2022/.22.Latest Investment Return Assumptions.Natio
137、nal Association of State Retirement Administrators,https:/www.nasra.org/latestreturnassumptions.23.American Hospital Association.Total Number of Births in U.S.Hospitals from 1946 to 2019.Statista,Statista Inc.,31 Jan 2021,https:/ Profile of Older Americans.Administration for Community Living,https:/
138、acl.gov/sites/default/files/Aging%20and%20Disability%20in%20America/2020ProfileOlderAmericans.Final_.pdf.25.“Population Age Structure by Major Age Groups.”Statistics Explained,https:/ec.europa.eu/eurostat/statistics-explained/index.php?title=File:Population_age_structure_by_major_age_groups,_2011,_2
139、020_and_2021_(%25_of_the_total_popu-lation)_rev.png&oldid=555635.26.Population Ages 65 and above(%of Total Population).https:/data.worldbank.org/indicator/SP.POP.65UP.TO.ZS?locations=JP.27.“Aging and Health in China:What Can We Learn from the Worlds Largest Population of Older People?”PRB,https:
140、/www.prb.org/resources/china-aging-worlds-largest-population-older-people/.28.Chinas Push for Delayed Retirement Kicks off as Pension Costs Grow,Nikkei Asia,https:/ at a Glance.”OECD and G20 Indicators|OECD ILibrary,https:/www.oecd-ilibrary.org/sites/a957e891-en/index.html?itemId=%2Fcontent%2Fcompon
141、ent%2Fa957e891-en.30.OECD Health Statistics 2021,OECD Historical Population Data and Projections Database,2021.31.OECD(2022),Old-age dependency ratio(indicator).doi:10.1787/e0255c98-en(Accessed on 24 August 2022)32.OECD(2022),General government debt(indicator).doi:10.1787/a0528cc2-en(Accessed on 24
142、August 2022)33.OECD.Health Expenditure as a Percentage of Gross Domestic Product(Gdp)in Selected Countries in 2020.Statista,Statista Inc.,12 Jul 2022,https:/ Do Health Expenditures Vary across the Population?”Peterson-KFF Health System Tracker,https:/www.healthsystemtracker.org/chart-collection/heal
143、th-expenditures-vary-across-population.35.Global Report Global Expenditure on Health:Public Spending on the Rise?World Health Organization,https:/apps.who.int/iris/bitstream/handle/10665/350560/9789240041219-eng.pdf.36.“Is Age Just a Number?Meeting the Economic Challenges of a Graying World.”ECOSCOP
144、E,https:/oecdecoscope.blog/2019/09/11/is-age-just-a-number-meeting-the-economic-challenges-of-a-graying-world/.37.Natixis Investment Managers,Global Survey of Individual Investors conducted by CoreData Research,March and April 2021.Survey included 8,550 investors across 24 countries.38.McCarthy,Nial
145、l.Where People Are Working Beyond 65.Statista,Statista Inc.,24 Sep 2019,https:/ Europe-Statistics on Working and Moving into Retirement.”Statistics Explained,https:/ec.europa.eu/eurostat/statistics-explained/index.php?title=Ageing_Europe_-_statistics_on_working_and_moving_into_retirement.40.“Fact Sh
146、eet:Aging in the United States.”PRB,https:/www.prb.org/resources/fact-sheet-aging-in-the-united-states/.41.Morning Consult.Interest in Gig Economy Jobs for Extra Money and Flexibility in The U.S.in 2018,by Age.Statista,Statista Inc.,12 Sep 2018,https:/www.statis- Investment Managers,Global Survey of
147、 Individual Investors conducted by CoreData Research,March and April 2021.Survey included 8,550 investors across 24 countries.43.Natixis Investment Managers,Global Survey of Individual Investors conducted by CoreData Research,March and April 2021.Survey included 8,550 investors across 24 countries.1
148、5Global Retirement Index 2022The views and opinions expressed may change based on market and other conditions.This material is provided for informational purposes only and should not be construed as investment advice.There can be no assurance that developments will transpire as forecasted.Actual res
149、ults may vary.All investing involves risk,including the risk of loss.No investment strategy or risk management technique can guarantee return or eliminate risk in all market environments.Outside the United States,this communication is for information only and is intended for investment service provi
150、ders or other Professional Clients.This material must not be used with Retail Investors.This material may not be redistributed,published,or reproduced,in whole or in part.Although Natixis Investment Managers believes the information provided in this material to be reliable,including that from third
151、party sources,it does not guarantee the accuracy,adequacy or completeness of such information.In the EU(ex UK):Provided by Natixis Investment Managers S.A.or one of its branch offices listed below.Natixis Investment Managers S.A.is a Luxembourg management company that is authorized by the Commission
152、 de Surveillance du Secteur Financier and is incorporated under Luxembourg laws and registered under n.B 115843.Registered office of Natixis Investment Managers S.A.:2,rue Jean Monnet,L-2180 Luxembourg,Grand Duchy of Luxembourg.France:Natixis Investment Managers Distribution(n.509 471 173 RCS Paris)
153、.Registered office:43 avenue Pierre Mends France,75013 Paris.Italy:Natixis Investment Managers S.A.,Succursale Italiana(Bank of Italy Register of Italian Asset Management Companies no 23458.3).Registered office:Via Larga,2-20122,Milan,Italy.Germany:Natixis Investment Managers S.A.,Zweigniederlassung
154、 Deutschland(Registration number:HRB 88541).Registered office:Im Trutz Frankfurt 55,Westend Carre,7.Floor,Frankfurt am Main 60322,Germany.Netherlands:Natixis Investment Managers,Nederlands(Registration number 50774670).Registered office:Stadsplateau 7,3521AZ Utrecht,the Netherlands.Sweden:Natixis In
155、vestment Managers,Nordics Filial(Registration number 516405-9601-Swedish Companies Registration Office).Registered office:Kungsgatan 48 5tr,Stockholm 111 35,Sweden.Spain:Natixis Investment Managers,Sucursal en Espaa.Serrano n90,6th Floor,28006 Madrid,Spain.In Switzerland:Provided by Natixis Investme
156、nt Managers,Switzerland Srl,Rue du Vieux Collge 10,1204 Geneva,Switzerland or its representative office in Zurich,Schweizergasse 6,8001 Zrich.In the UK:Provided by Natixis Investment Managers UK Limited,authorized and regulated by the Financial Conduct Authority(register no.190258).Registered Office
157、:Natixis Investment Managers UK Limited,One Carter Lane,London,EC4V 5ER.In the DIFC:Distributed in and from the DIFC financial district to Professional Clients only by Natixis Investment Managers Middle East(DIFC Branch)which is regulated by the DFSA.Related financial products or services are only a
158、vailable to persons who have sufficient financial experience and understanding to participate in financial markets within the DIFC,and qualify as Professional Clients as defined by the DFSA.Registered office:Office 603-Level 6,Currency House Tower 2,PO Box 118257,DIFC,Dubai,United Arab Emirates.In S
159、ingapore:Provided by Natixis Investment Managers Singapore(name registration no.53102724D),a division of Ostrum Asset Management Asia Limited(company registration no.199801044D).Registered address of Natixis Investment Managers Singapore:5 Shenton Way,#22-05 UIC Building,Singapore 068808.In Taiwan:P
160、rovided by Natixis Investment Managers Securities Investment Consulting(Taipei)Co.,Ltd.,a Securities Investment Consulting Enterprise regulated by the Financial Supervisory Commission of the R.O.C.Registered address:16F-1,No.76,Section 2,Tun Hwa South Road,Taipei,Taiwan,Da-An District,106(Ruentex Fi
161、nancial Building I),R.O.C.,license number 2017 FSC SICE No.018,Tel.+886 2 2784 5777.In Japan:Provided by Natixis Investment Managers Japan Co.,Ltd.,Registration No.:Director-General of the Kanto Local Financial Bureau(kinsho)No.425.Content of Business:The Company conducts discretionary asset managem
162、ent business and investment advisory and agency business as a Financial Instruments Business Operator.Registered address:1-4-5,Roppongi,Minato-ku,Tokyo.In Hong Kong:Provided by Natixis Investment Managers Hong Kong Limited to institutional/corporate professional investors only.Please note that the c
163、ontent of the above website has not been reviewed or approved by the HK SFC.It may contain information about funds that are not authorized by the SFC.In Australia:Provided by Natixis Investment Managers Australia Pty Limited(ABN 60 088 786 289)(AFSL No.246830)and is intended for the general informat
164、ion of financial advisers and wholesale clients only.In New Zealand:This document is intended for the general information of New Zealand wholesale investors only and does not constitute financial advice.This is not a regulated offer for the purposes of the Financial Markets Conduct Act 2013(FMCA)and
165、 is only available to New Zealand investors who have certified that they meet the requirements in the FMCA for wholesale investors.Natixis Investment Managers Australia Pty Limited is not a registered financial service provider in New Zealand.In Latin America:Provided by Natixis Investment Managers
166、S.A.In Colombia:Provided by Natixis Investment Managers S.A.Oficina de Representacin(Colombia)to professional clients for informational purposes only as permitted under Decree 2555 of 2010.Any products,services or investments referred to herein are rendered exclusively outside of Colombia.In Mexico:
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173、s Distribution,LLC,888 Boylston St.,Boston,MA 02199.Natixis Investment Managers includes all of the investment management and distribution entities affiliated with Natixis Distribution,LLC and Natixis Investment Managers S.A.This material should not be considered a solicitation to buy or an offer to
174、 sell any product or service to any person in any jurisdiction where such activity would be unlawful.4894131.1.1The Global Retirement Index(GRI)is a multi-dimensional index developed by Natixis Investment Managers and CoreData Research to examine the factors that drive retirement security and to pro
175、vide a comparison tool for best practices in retirement policy.As the GRI continues to run each year,it is our hope it will be possible to discern ongoing trends in,for instance,the quality of a nations financial services sector,thereby identifying those variables that can be best managed to ensure
176、a more secure retirement.The country rankings are intended to examine key retirement factors and a discussion of best practices.This is the tenth year Natixis and CoreData have produced the GRI as a guide to the changing decisions facing retirees as they focus on their needs and goals for the future
177、,and where and how to most efficiently preserve wealth while enjoying retirement.As part of celebrating a decade producing the GRI,the report will include historical analysis of previous country rankings to examine changes in retirement conditions in the individual countries.The index includes Inter
178、national Monetary Fund(IMF)advanced economies,members of the Organization for Economic Cooperation and Development(OECD)and the BRIC countries(Brazil,Russia,India and China).The researchers calculated a mean score in each category and combined the category scores for a final overall ranking of the 4
179、4 nations studied.See page 75:Appendix B for the full list of countries.Global RetirementIndex 202210Years81%and above41%50%40%and below51%60%61%70%71%80%OVERALL GRI SCOREGlobal Retirement Index 202215FrameworkThe index incorporates 18 performance indicators,grouped into four thematic sub-indices,wh
180、ich have been calculated on the basis of reliable data from a range of international organizations and academic sources.It takes into account the particular characteristics of the older demographic retiree group in order to assess and compare the level of retirement security in different countries a
181、round the world.The four thematic indices 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.The su
182、b-indices provide insight into which particular characteristics are driving an improvement or worsening each countrys position.Data has been tracked consistently to provide a basis for year-over-year comparison.Life ExpectancyHealth Expenditure per CapitaNon-Insured Health ExpenditureOld-Age Depende
183、ncyBank Non-Performing LoansInflationInterest RatesTax PressureGovernanceGovernment IndebtednessIncome EqualityIncome per CapitaUnemploymentHappinessAir QualityWater and SanitationBiodiversity and HabitatEnvironmental FactorsHealthFinances in RetirementMaterial WellbeingQuality of LifeGlobal Retirem
184、ent Index 202216The Best PerformersNorway returns to the top in this years GRI after four years in third place,registering a score of 81%.Iceland moves down two spots into third with a score of 79%.Switzerland remains in second while Ireland also retains the same rank as last year at fourth.Australi
185、a,New Zealand,Netherlands and Denmark remain in the top ten this year with rankings of fifth,sixth,eighth and ninth respectively.Luxembourg(seventh)and Czech Republic(tenth)are two new entrants in the top ten this year,replacing Germany and Canada.Countries in the top ten overall typically score ver
186、y well across all four sub-indices.Both Norway and Iceland have the distinction of finishing in the top ten in all four sub-indices.The rest of the top ten countries have at least one top-ten sub-index score,with no countries ranking in the bottom ten.The one outlier in the group is Denmark,which ra
187、nks in the bottom half(33rd)for Finances.This year,the top performers rankings across the four sub-indices are more consistent than in years past.Among the top ten overall countries,there are six top ten finishes for Health,Material Wellbeing and Finances and seven for Quality of Life.In previous ye
188、ars,some of the top ten countries did very well in Health and Quality of Life but would be near the middle or bottom of the rankings for Material Wellbeing and Finances.While this is still the case for some countries such as Denmark,others have managed to improve weak spots to improve their overall
189、placement.For example,Norway rose from 25th to eighth in Finances because its five-year average for interest rates moved into positive territory.Finances had been the one sub-index holding it back from pole Top 10Countries in2022 GRI202220212012Rankingchange1.Norway2281%80%87%4.Ireland34076%78%59%9.
190、Denmark1074%75%77%5.Australia2175%76%79%8.Netherlands3175%76%79%6.New Zealand28075%76%63%7.Luxembourg4875%74%82%2.Switzerland0080%81%85%3.Iceland21679%83%73%10.Czech Republic4873%73%72%Global Retirement Index 202217position given the rest of its sub-indices are in the top five with Health ranking fi
191、rst,Material Wellbeing ranking second and Quality of Life ranking fourth.Switzerland remains second this year with a marginally lower score compared to last year.Its rankings are relatively consistent with the previous year with Health ranking fourth,Finances ranking second and Quality of Life ranki
192、ng fifth.Material Wellbeing is its only sub-index to not make the top ten with a ranking of 14th.Although Iceland drops two spots to third overall,it still has superb performances across all four sub-indices.All its sub-indices place in the top ten with Material Wellbeing ranking fifth,Quality of Li
193、fe ranking sixth and both Health and Finances ranking tenth.Ireland,which has made considerable score improvements over the years,continues its steady performance and retains its overall ranking of fourth.It posts top-ten finishes in Finances and Health,ranking seventh and eighth respectively,while
194、it finishes twelfth in Quality of Life.It falls out of the top ten for Material Wellbeing after dropping seven spots to 17th.Australia and New Zealand rank fifth and sixth overall in this years GRI with Australia moving up two spots and New Zealand retaining the same rank as last year.Both countries
195、 place in the top ten for two sub-indices.Australia ranks fourth and ninth for Finances and Health respectively,while New Zealand ranks sixth and ninth for Finances and Quality of Life respectively.Both have relatively mediocre scores for the Material Wellbeing sub-index at 19th and 20th.Luxembourg
196、and Czech Republic,two new entrants in the top ten at seventh and tenth respectively,took different paths to get there.While both countries climbed up four spots,only Luxembourg registers a higher overall score,with Czech Republic curiously keeping the same score as last year.Luxembourg is only one
197、of two countries in the top ten to have a higher overall score compared to last year due to higher scores across all four sub-indices.Two of its sub-index rankings,Material Wellbeing(ninth)and Quality of Life(tenth),move into the top ten while Health remains in the top ten at second.Meanwhile,Czech
198、Republic has the same overall score as last year and only has one sub-index(Material Wellbeing)placing in the top ten,albeit first place.Czech Republics move into the top ten is therefore more of a result of other countries losing ground such as Germany and Canada.The Netherlands and Denmark,at eigh
199、th and ninth respectively,round out the top ten overall.Both countries have two sub-index finishes in the top ten,with the Netherlands ranking third and seventh for Material Wellbeing and Health respectively,and Denmark ranking second and sixth for Quality of Life and Material Wellbeing respectively
200、.Global Retirement Index 202218GRIs Biggest Movers:A Ten-Year RetrospectiveThe LeadersIreland stands alone with the largest gains in the GRI rankings over the past decade.It has rocketed from 38th overall in 2012 all the way to fourth this year.The Finances sub-index is the biggest driver of its gai
201、ns.The sub-index started at rock bottom of the list in 2012 and now ranks seventh among all countries.Indicators leading the charge include tax pressure,which went from bottom 15 to eighth this year,and government indebtedness which moved from 21st to ninth.The Quality of Life sub-index also had a m
202、eaningful positive impact on Irelands overall score trajectory,moving from 24th a decade ago to 12th this year.Within this sub-index,the largest improvements over the ten years are in biodiversity and environmental factors.New Zealand has also had a meteoric rise in the overall rankings,improving 28
203、 spots from 34th to sixth overall.Compared to a decade ago,New Zealand has realized the largest gains in the Health sub-index.The country had the second-lowest score for the sub-index in 2012 with poor performance in the health expenditure indicators.Since then,the sub-index score has improved 26 sp
204、ots to 16th this year.Recently,New Zealand has posted consistent strong performance,holding the same overall rank for the past four years.Steady top ten performances in Finances and Quality of Life have helped solidify the country in the top ten,while its Material Wellbeing rank continues to hover i
205、n the middle of the pack.Iceland has posted the third-largest climb over the decade.After starting 17th overall in 2012,Iceland has managed to consistently compete in the top three over the past eight years,finishing top of the pile on four occasions.Similar to Ireland,the Finances sub-index has bee
206、n the biggest factor pushing Iceland into the top echelon of the overall rankings.Ten years ago,it started at 41st for the Finances sub-index.Improvements across its indicators,particularly bank nonperforming loans and interest rates,have moved Icelands sub-index ranking up to eighth.As for the othe
207、r sub-indices,Icelands performance in the Quality of Life and Health sub-indices has actually slipped somewhat since 2012,but remains strong relative to peers.Czech Republic is a new entrant in the top ten this year and has experienced significant score growth from a decade ago.It started at 22nd in
208、 2012 and now ranks tenth overall this year.The Finances and Material Wellbeing sub-indices are the main drivers of the Czech Republics overall positive movement from 2012,with the former sub-index moving from 32nd to 15th and the latter moving from 17th to first.The Health and Quality of Life sub-i
209、ndices lag somewhat,as the former has moved from 12th to 27th and the latter has hovered between 21st and 30th over the course of the decade.Spotlight:Global Retirement Index 2022191 23 Iceland4 Ireland56 New Zealand78 910 Czech Republic 11121314 02122232425 Estonia262728293033
210、7386223242526272829303373820000202021The LeadersGlobal Retirement Index 202220Eastern Europe and Central AsiaMaterial Wellbeing IndexQuality of Life IndexGlobal Retirement IndexHealth IndexFinances in Retirement Index32%55%
211、53%45%49%54%60%57%16%85%67%72%56%85%54%78%56%63%23%32%32%66%37%49%69%North AmericaLatin AmericaAsia PacificWestern EuropeRegional PerspectiveFor the fourth year in a row,North America has the highest score among regions at 69%.Western Europe places second with an overall score of 66%,followed by Eas
212、tern Europe and Central Asia(49%)and Latin America(37%),with Asia Pacific(32%)finishing last.The regional scores are population-weighted,so the scores of countries with larger populations have a larger proportional effect on the regional score than the scores of countries with smaller populations.No
213、rth America sets the pace for the overall rankings as a result of having the highest regional scores for the Finances and Material Wellbeing sub-indices,and the second-highest scores for the Health and Quality of Life sub-indices.The region benefits from having just two relatively strong performers
214、to account for,whereas other regions contain weak countries that drag down the regional scores.Western Europe has the same sub-index rankings as last year.The region ranks first for both the Health and Quality of Life sub-indices,second for Material Wellbeing and fourth for Finances.Individual count
215、ry performances remain superb in the former two sub-indices,with Western European countries making up eight of the top ten for Health and nine of the top ten for Quality of Life.As for the Finances sub-index,more of its countries Global Retirement Index 202221finish either in the middle of the pack
216、or the back end,such as Greece at second-to-last,France at fourth-to-last and Belgium at seventh-to-last.If Western Europes Finances score were to match the pace of its other sub-indices,it would have the highest overall regional score.Eastern Europe and Central Asia finishes third overall as a regi
217、on.Like Western Europe,it struggles in Finances where it finishes rock bottom.Four of the bottom ten countries in Finances belong to this region,namely Turkey,Hungary,Slovak Republic and Latvia.The region also ranks second-to-last in Quality of Life but manages to move up one spot to third for Healt
218、h and maintains its ranking for Material Wellbeing.This mixed performance across the sub-indices leads to a middle of the pack result overall.Latin America comes in at fourth overall.The region ranks third for both Finances and Quality of Life,fourth for Health and fifth for Material Wellbeing.Latin
219、 Americas performance in Material Wellbeing,where its score is just 16%,continues to significantly hold back its overall performance.All four Latin American countries,namely Brazil,Colombia,Chile and Mexico,feature in the bottom ten for Material Wellbeing with scores of less than 40%.Brazil in parti
220、cular scores extremely low at 4%.While some countries perform relatively better in other sub-indices,such as Chile ranking fifth for Finances,it is not enough to compensate for the poor score in Material Wellbeing.Asia Pacific has the lowest overall regional score due to posting poor scores in three
221、 of the four sub-indices.The low scores for the Health and Quality of Life sub-index are in large part driven by Indias exceptionally low scores in these two sub-indices.The Finances sub-index is a bright spot,where the region has the second-highest score.Four of the top six countries in the sub-ind
222、ex are Asia Pacific countries with Singapore ranking first,South Korea ranking third,Australia ranking fourth and New Zealand ranking sixth.Still,this bright spot is not enough to outweigh the relatively low scores in the other sub-indices.Global Retirement Index 202222Performanceby Sub-IndexThe per
223、formance by sub-index section analyzes GRI performance on an indicator-by-indicator basis.Focusing on sub-index performance highlights the strengths of some countries indicators and illuminates good practices for certain countries while highlighting needed areas of improvement for others.Global Reti
224、rement Index 202223Health IndexNorway reclaims the top spot in the Health sub-index,as Japan slides from 1st to 3rd.Luxembourg moves into 2nd place,climbing up one spot from 2021.The Health sub-index is based on performance across three indicators:insured health expenditure,life expectancy and healt
225、h expenditure per capita.Norway benefited from improving its ranking in life expectancy and insured health expenditure and maintaining a high rank for health expenditure per capita.Luxembourg slides two places for life expectancy despite an increase in score but exhibits a sizable increase in its he
226、alth expenditure per capita score,warranting an overall improvement for the country.Japan slips one spot for health expenditure per capita and insured health expenditure but tops the life expectancy index ultimately the two negatives outweigh the one positive,pushing Japan 2 ranks down from 2021.Swi
227、tzerland and Sweden round out the top five,with each inching up one spot from last year by either maintaining or advancing their ranks across all Health sub-index indicators.France,which was 4th in 2021,falls 2 spots down to 6th even though it posted an improved score for two Health sub-index indica
228、tors and maintained its top score for insured health expenditure.Completing the top ten are the Netherlands,Ireland,Australia,and Iceland.The Netherlands moves from 8th to 7th,as significant improvements were made in life expectancy and health expenditure per capita.Ireland,which ranks 8th,posts the
229、 biggest drop in ranking among all countries for health expenditure per capita,falling to 10th from 6th in 2021.However,its life expectancy ranking improves to 15th from 18th and thus mitigates the negative impact on the overall index score.Australia increases one spot to 9th despite dropping 2 plac
230、es in the life expectancy indicator(from 7th to 9th).Its overall index score was buoyed by its insured health expenditure,which moves up 2 spots,in concert with an improvement in its health expenditure per capita score.Iceland takes back its top 10 place this year after ranking 12th in 2021.All its
231、heath sub-index indicators improved,propelling Iceland two ranks up.Canada,Germany,Denmark,Austria and Belgium make up 11th to 15th in the Health sub-index.Canada maintains its position as an increase in health expenditure per capita is neutralized by the decrease in scores of life expectancy and in
232、sured health expenditure.Germany leaves the top 10 list as it suffers a major slide in the life expectancy indicator(20th to 27th)and registers a one-spot decline in each of the other two Health sub-index indicators.Denmark and Austria remain at 13th and 14th respectively,but their insured health ex
233、penditures both decrease from 2021.Belgium posts moderate improvement in life expectancy and insured health expenditure which is instrumental for its placement in 15th.The next five countries are New Zealand,the United States,Spain,Finland,and Italy.New Zealand swaps spots with Belgium and is now in
234、 16th place.Its decline is due to a significant decrease in the life expectancy indicator(16th to 22nd).The United States maintained its status in 17th.The countrys health expenditure per capita ranks first among all countries and even the insured health expenditures is very high(4th),but its life e
235、xpectancy score still languishes well below in 31st,an increase of 3 spots from 2021.The remaining three countries in the top 20 Rankingchange2022202120121Norway1291%90%86%2Luxembourg1391%90%86%3Japan2791%90%85%4Switzerland1490%88%85%5Sweden1990%88%83%6France90%89%89%227Netherlands89%87%86%138Irelan
236、d89%87%84%139Australia88%87%82%11010Iceland88%86%86%25Top 10Countriesin HealthSub-IndexGlobal Retirement Index 202224Top 25 Countries in Health Sub-IndexRankingCountryScore2022202212012NorwayLuxembourgJapanSwitzerlandSwedenFranceNetherlandsIrelandAustraliaIcelandCanadaGermanyDenmarkAustri
237、aBelgiumNew ZealandUnited StatesSpainFinlandItalyUnited KingdomSloveniaSingaporeIsraelKorea,Rep.62232425237223254689343091%91%91%90%90%90%89%89%88%88%87%87%86%86%85%85%85%85%84%83%83%82%82%82%80%90%90%
238、90%88%88%89%87%87%87%86%86%87%85%85%83%84%83%82%82%81%82%80%81%80%77%86%86%85%85%83%89%86%84%82%86%79%88%84%90%84%35%81%83%83%83%82%81%67%80%78%61%70%71%80%91%100%81%90%Color Scale0%60%all increased their rankings from 2021.Spain is up 1 spot to 18th by improving scores and maintaining ranks on all
239、Health sub-index indicators.Similarly,Finland is up 1 spot to 19th by increasing its scores and ranks on all indicators.Italy,at rank 20,increases its scores on all indicators,but only the life expectancy ranking reflected that,climbing up 2 spots in 2022.The last five countries in the top 25 are th
240、e United Kingdom,Slovenia,Singapore,Israel,and South Korea.The UK falls out of the top 20 for the first time in five years,driven by improvements from other countries rather than a decrease in its own scores.Slovenia jumps up 2 spots to 22nd,with progress in life expectancy and health expenditure pe
241、r capita leading the way.Slovenia also ranks strongly in the insured health expenditure indicator.With Slovenia going 2 spots up,Singapore and Israel each move 1 spot down,placing 23rd and 24th for Health sub-index.Both countries are performing well in life expectancy indicators(top 10)but show medi
242、ocre scores and ranks in health expenditure per capita and insured health indicators.South Korea maintained its 25th spot.Similar to Singapore and Israel,South Korea scores well in the life expectancy indicator,but poorly in the health expenditure per capita and insured health indicators.Global Reti
243、rement Index 202225Ukrainian refugees could improvePolish demographic issuesPoland is facing a demographic crisis,with population both aging at a faster rate than similar countries and also starting to shrink in size,according to its most recent census.In this context,the arrival of over a million,i
244、f not more,Ukrainian refugees so far in 2022 might be a silver lining to a dark demographic cloud hovering over Poland.Poland sits at 26th overall in the GRI rankings for 2022,with its strongest performance coming from a 7th place ranking in the Material Wellbeing sub-index.However,as a greater port
245、ion of the population ages out of the labor force,Poland will feel considerable pressure on its old-age dependency ratio,a key factor within the GRIs Finances in Retirement sub-index.But could an influx of refugees from the war in Ukraine help to change Polands fortunes in this area over the long te
246、rm?And what lessons can be taken from the arrival of Syrian migrants over the past decade in Polands neighbor to the west,Germany?Over the past ten years,Poland has seen its old-age dependency ratio increase from 21.2%in 2012 to 32.2%in 2022.Polands demographic shift outpaces the change seen across
247、all OECD members over that same timeframe,which grew more modestly from 25.8%in 2012 to 32.4%this year.The demographic old-age dependency ratio is defined as the number of individuals aged 65 and over per 100 people of working age.The ratio is a function of both an aging population and the size of t
248、he labor force.While Polands old-age dependency ratio currently sits roughly in line with the OECD average,the countrys older age group is forecasted to rise considerably faster than its counterparts.Polands old-age dependency ratio is forecasted to reach 60.3%by 2050,compared to 52.7%for OECD count
249、ries overall.Polands population is also on a downward path.From a peak of 38.6 million in 1999,it is projected to fall to 33.3 million by 2050,the result of both a low birth rate and negative net migration in recent times,as many younger workers left in search of work abroad.https:/ World Population
250、 Review,Poland population 2022(live)https:/ Population Review,https:/ Population(as of 6/13/2022)Last UN Estimate(7/1/2022)Births per DayDeaths per DayMigrations per DayNet Change per DayPopulation Change Since Jan.1Net decrease of 1 person every 9 minutesPopulation estimates based on interpolation
251、of data from World Population Prospects37,742,93937,739,7859611,089-38-166-27,058Poland Population ClockGlobal Retirement Index 202226Given Polands dire demographics,the mass migration caused by Russias attack on Ukraine may help improve its outlook.At present,there is considerable uncertainty over
252、how many Ukrainian refugees have settled in Poland since the Russian invasion began in February.According to the United Nations High Commissioner on Refugees(UNHCR),Poland has been the biggest recipient of Ukrainian refugees,with more than 1.15 million,compared to 1.12 million in the Russian Federat
253、ion,780,000 in Germany and 366,632 in the Czech Republic.4 However,another report5 claimed the Polish population has increased by 8%,or almost 3.2 million people,this year due to influx of refugees,although others think the true figure is closer to 2 million.In any event,Poland already hosted a subs
254、tantial Ukrainian diaspora,with 600,000 individuals registered to the Polish social insurance system and up to double that number estimated to be in Poland in total.6 Given that Ukrainian men of conscription age,18 to 60,have not been allowed to leave the country,women and children account for a vas
255、t proportion of refugees.Anecdotally,refugee groups also incorporate relatively fewer people from older demographics based on greater challenges associated with fleeing the country(healthcare,mobility,etc.).These combined factors mean that the demographics of refugees arriving in Poland skew towards
256、 working-age females today,as well as children that can significantly contribute to the labor pool in the future.As a result,Poland has the potential to make up ground in old-age dependency compared to its peers,or at least slow the current trends expected from the currently aging population.4 https
257、:/data.unhcr.org/en/situations/ukraine5 Union of Polish Metropolises,https:/metropolie.pl/fileadmin/news/2022/04/Ump_Ukraina_RAPORT_final_2.pdf6 https:/ from Poland website,How many Ukrainian refugees are there really in Poland,and who are they?The impact of Ukrainian immigration on Polands demograp
258、hics100+9599909485898084757970746569606455595054454940443539303425292024151910-145-9042,000,0001,000,0001,000,00002,000,000Age Pyramid of PolandNote:Ukrainian refugees aged 65 and older were all added to the 6569 age group,even if some of them were older.The official data do not report on specific a
259、ge sub-groups for refugees aged 65 and older.Males-PolishMales UkrainianFemales PolishFemales UkrainianGlobal Retirement Index 202227A recent historical parallel can be found in Germany,which led the way among European countries in accepting Syrian refugees during the migrant crisis that began in 20
260、14.It currently hosts over 600,000 refugees from the country.7 Over the past decade,Germany faced similar pressures as Poland regarding a rapidly aging population,as it saw its old-age dependency ratio increase from 26.5%in 2000 to 35.0%in 2014,when the migrant crisis took hold,and it has since incr
261、eased further to 40.5%in 2022.8 In 2014 Germany also faced an overall population decline.9 While the influx of Syrian refugees could not change the momentum of the old-age dependency ratio,Germany did reverse its population decline and begin to grow again.This experience in Germany bodes well for th
262、e impact of the current refugee trends in Poland.Not only does the number of Ukrainian refugees entering Poland significantly outpace Syrian entries to Germany on an absolute basis,but they are also entering into a country with less than half the population of Germany0 leading to a proportionally la
263、rger demographic impact.An unknown factor for Poland is whether the refugees from war-torn Ukraine will want to stay permanently or return home in the future.Whereas Syrian migrants to Germany are likely to settle there,in search of a better life and because of the fear of persecution should they re
264、turn to Syria,many Ukrainian refugees may want to return and help to rebuild their country,if and when peace returns.Against this,the cultural and linguistic similarities of Poland and Ukraine may lead others to decide to remain in Poland,particularly if they assimilate and find work opportunities t
265、hey might not have had at home.If a substantial part of the Ukrainian population that has migrated to Poland puts down roots for the long term,the country stands to see a considerable improvement in its old-age dependency ratio and will benefit in its efforts to provide for its growing number of ret
266、irees.7 Statista,Ranking of the largest Syrian refugee-hosting countries in 2020,https:/ OECD,https:/data.oecd.org/pop/old-age-dependency-ratio.htm9 Newsham,N.,Rowe,F.Projecting the demographic impact of Syrian migration in a rapidly ageing society,Germany.J Geogr Syst 23,231261(2021).https:/doi.org
267、/10.1007/s10109-018-00290-y0 OECD,https:/data.oecd.org/pop/population.htm#indicator-chartGlobal Retirement Index 202228Material Wellbeing IndexCzech Republic moves up three spots from 2021 and tops this years Material Wellbeing sub-index,a first for the country since the GRIs inception.The Material
268、Wellbeing sub-index is based on performance across three indicators:income equality,income per capita and unemployment.Czech Republic is one of the top 5 countries in unemployment and income equality,and its income per capita indicator posts improvement in score and ranking.Norway and the Netherland
269、s maintain their positions at 2nd and 3rd,respectively.Despite retaining their ranks,the Material Wellbeing scores of these countries fell significantly.The dips are driven primarily by a plunge in unemployment scores,which push Norways ranking down 9 spots and the Netherlands by 7 spots.The Netherl
270、ands also slips 5 spots in the income equality indicator.Rounding out the top 5 are Slovenia and Iceland.Slovenia jumps two spots to 4th as a result of rising 3 places in income per capita,while holding its high ranks in income equality and unemployment.Iceland,which secured first or second spot in
271、the Material Wellbeing sub-index for the past 6 years,now slips four places to 5th.Its scores for income per capita and unemployment post the largest decreases of all countries in the GRI,resulting in a 6-place decrease in the latter(from 8th to 14th)and a 16-place fall in the latter(from 6th to 22n
272、d).However,Icelands income equality performance remains strong in second place,mitigating a major slide down the Material Wellbeing ranks.Denmark,Poland,Malta,Luxembourg,and Japan complete the top 10 in the Material Wellbeing sub-index.All of these countries increase their rankings this year with th
273、e exception of Malta,which slips 1 spot down from 7th to 8th.The underperformance of Malta is driven by a marked decline in its income equality ranking(down 6 spots to 18th)and income per capita(down 5 spots to 27th).A more drastic decrease in Maltas sub-index rank is negated by a big improvement in
274、 its unemployment indicator ranking(up from 8th to 4th).Denmark and Poland made a decent jump forward over the last year,with the former moving up two places to 6th based on an increase in its unemployment ranking.Poland moves up four places to 7th as rankings across all their indicators improve.Lux
275、embourg and Japan post the highest climb among the top 10 countries.The former jumps 8 places to 9th while the latter climbs 6 places to 10th,driven by a boost in rankings in their income equality and unemployment indicators.The 11th to 15th ranks are all in Europe:Germany,Hungary,Belgium,Switzerlan
276、d,and Austria.Among these five,three countries decline in ranking compared to last year.Germany slides 6 ranks down to 11th and leaves the top 10 for the very first time.Its income equality indicator deteriorates massively,slipping 11 spots to 28th.Austria also slides 6 spots down to 15th as all its
277、 indicators fall.Belgium has a small decline in rank from 13th to 12th,while Hungary inches one spot up to 12th.Switzerland keeps its place of 14th as the country shows a steady performance.South Korea ranks 16th this year,continuing its climb back toward the top 10 after falling 17 places in 2020.R
278、ankingchange202220212012Top 10Countriesin MaterialWellbeingSub-Index1Czech Republic84%86%74%3132Norway79%90%96%103Netherlands78%87%84%204Slovenia77%82%75%295Iceland77%92%79%4136Denmark76%78%80%257Poland75%76%66%4158Malta72%79%82%129Luxembourg72%72%94%81510Japan72%73%72%65Global Retirement Index 2022
279、29Top 25 Countries in Material Wellbeing Sub-IndexRankingCountryScore2022202212012Czech RepublicNorwayNetherlandsSloveniaIcelandDenmarkPolandMaltaLuxembourgJapanGermanyHungaryBelgiumSwitzerlandAustriaKorea,Rep.IrelandSlovak RepublicAustraliaNew ZealandFinlandCyprusUnited KingdomEstoniaIsr
280、ael622324254236323242030502534%79%78%77%77%76%75%72%72%72%71%70%70%69%69%68%67%67%66%64%63%62%61%60%60%86%90%87%82%92%78%76%79%72%73%83%75%76%75%77%65%77%74%67%66%69%58%69%65%67%74%96%84%75%79%80%66%82
281、%94%72%82%67%74%82%86%83%65%71%85%70%81%81%73%56%66%61%70%71%80%91%100%81%90%Color Scale0%60%All its Material Wellbeing indicators show improvement,with unemployment improving dramatically(from 19th to 5th in 2022).Completing the top 20 are Ireland,Slovak Republic,Australia,and New Zealand.Ireland(1
282、7th)and Slovak Republic(18th)fall seven and three spots respectively,as both post a greater than 15%drop in scores for unemployment.Australia(19th)and New Zealand(20th)both move up 4 spots from last year because of increases in their income per capita and unemployment indicators.In spots 21 to 25 ar
283、e Finland,Cyprus,United Kingdom,Estonia,and Israel.Among them,Cyprus was the standout,progressing 8 places from last year and returning to the top 25 after spending eight years outside.This gain is attributed to improvements in unemployment(12 spots up)and income equality(7 spots up).The United King
284、doms score for income equality decreases by 15%and drives the countrys Material Wellbeing rank to 23rd from 18th.Israel(25th)just barely keeps its place in the top 25,as its score for unemployment decreases by 19%and pulls its sub-index rank down 3 places.Global Retirement Index 202230Inflation impr
285、oving debt-to-GDP ratios?First impressions could be misleadingEver since the global financial crisis(GFC)of 2008,the advanced economies have experienced relatively high debt-to-GDP ratios,as a debt crisis that began in the private sector shifted to the public sector.The Covid-19 pandemic has further
286、 increased government debt levels,following the introduction of emergency aid packages and furlough schemes to prevent corporate failures and mass unemployment,when the pandemic brought a sudden downturn to large parts of the global economy.Data from the International Monetary Fund(IMF)shows that de
287、bt-to-GDP was at 71%for advanced economies in 2007 before the GFC,rising to 105.5%in 2012 after the GFC,as growth rates fell and governments were required to provide support to ailing economies at that time.Debt-to-GDP then spiked at 123.2%in advanced economies in 2020,with the impact of the pandemi
288、c.World Economic Outlook database:April 2022Source:IMF Fiscal Monitor,April 2022Now,after a prolonged period of very low inflation,the recent rise in inflation is improving debt-to-GDP ratios.This is due to price rises caused by inflation boosting GDP figures and tax revenues.Growth rates also initi
289、ally rebounded,as economies opened up following the pandemic,adding to this effect.At the same time,debt levels have remained constant and government borrowing costs are still relatively low.This has led to debt-to-GDP ratios falling in various countries.For example,in the USA,the ratio has gone fro
290、m 134.2%in 2020 to 125.6%in 2022.Similar falls have happened in the UK(102.6%in 2022 to 87.8%in 2020),Italy(155.3%in 2020 to 150.6%in 2022)and Canada(117.8%in 2020 to 101.8%in 2022).These countries have also seen inflation rise in the same period;inflation in the UK rose from 0.8%in 2020 to 7.4%in 2
291、022,and in the USA from 1.2%in 2020 to 7.7%in 2022(average consumer prices).Spotlight:Countries with largest overall gains over the decade9720002003200620092002120242027Global Retirement Index 202231In the article“Fiscal Policy from Pandemic to War”in the IMF Fiscal Monitor,Apr
292、il 2022,the IMF noted the link between the initial rise in inflation and falling debt-to-GDP ratios,saying that surprise inflation(the difference between actual and projected inflation rates)contributed to an average fall of 1.8%from 2021 debt-to-GDP ratios in advanced economies,and of 4.1%in emergi
293、ng markets.It added that the 2022 fiscal balance could improve from higher inflation.But while inflation has had an initial positive impact on debt-to-GDP ratios,this is unlikely to last if inflation persists.As the IMF Fiscal Monitor,April 2022,states:“Although inflation surprises can improve debt
294、dynamics,unexpected inflation cannot last.In the longer run,preserving the special status of government debt as the safe asset of reference requires maintaining price stability.”This means that if inflation continues,governments are likely to raise interest rates both to choke off inflation and to c
295、ompensate investors for holding government debt which is being devalued by inflation.While there have been historical cases where inflation has helped reduce public debt,such as in the USA after World War Two,this is unlikely to happen now as circumstances have changed.“Although the surprise rise in
296、 inflation may have provided short-term relief for fiscal accounts,the effects of higher and persistent inflation could reverse those gains and undermine financial stability and medium-term growth,”the IMF stated.The conflict in Ukraine is another factor at work here.According to the latest OECD Eco
297、nomic Outlook,released in June 2022,the war in Ukraine has intensified inflation pressures,as it is contributing to energy and food price inflation.Russia is a major gas supplier to many European countries and is an oil exporter,while Ukraine is an important producer of wheat.The OECD has found wide
298、spread increases in the annual inflation projections for 2022,from between December 2021 and June 2022,caused by the conflict.Source:https:/www.oecd.org/economic-outlook/Annual inflation projections for 2022TurkeyArgentinaLithuaniaEstoniaLatviaCzech Rep.PolandSlovak Rep.HungaryNetherlandsGreeceUnite
299、d KingdomSpainGermanyMexicoAustriaItalyPortugalFinlandCanadaUnited StatesAustraliaFranceKoreaNorwaySwitzerlandJapanDecember 2021 projectionJune 2022 projection23.9%44.4%3.2%4.1%4.4%4.4%3.1%3.2%2.2%6.3%6.2%2.3%2.1%2.0%3.3%2.7%4.4%3.1%2.8%3.0%4.9%6.1%6.0%6.2%6.0%72.0%60.1%15.6%10.8%8.8%6.9%9.2%8.1%6.3
300、%5.2%4.8%4.6%2.5%6.0%5.3%5.9%8.8%7.2%6.7%13.3%12.9%10.3%11.1%13.3%20%10%20%5%10%take logs-indicator in logarithmic form=ln(x)-ln(m)/ln(t)-ln(m)Geometric mean is a rn epresentation of the typical value or central tendency of a series of numbers calculated as the nth root of the product of n numbers.G
301、eometric mean=X1 X2.Xn4 Arithmetic mean(or average)is a representation of the typical value or central tendency of a series of numbers calculated as the sum of all the values in the series and divided by the number in the series.Arithmetic mean=5 See Constructing the Global Retirement Index on page
302、74.Global Retirement Index 202270The four thematic sub-indices are constructed using the indicators in the following way:1.The Health in Retirement Index:this sub-index is obtainedby taking the geometric mean of the following indicators:a.Life expectancy Index:obtained using data from theWorld Healt
303、h Organization.The target for this indicatoris the sample maximum which is equal to 84.26 years,and the low performance benchmark is equal to 70.79years,a figure observed as the sample minimum.b.Health expenditure per capita Index:obtained usingdata on current health expenditure per capita,PPP(curre
304、nt international$)from WBs WDI 2021.Thetarget set for this indicator is the sample maximum,equal to$10,623.85 USD,and the low performancebenchmark is equal to the sample minimum of$275.13.The indicator is transformed into logarithms,as themarginal returns to extra expenditure are decreasing.c.Non-in
305、sured health expenditure Index:thisindicator is included to take into account the levelof expenditure in health that is not insured.Thesmaller the proportion of expenditure in healthcarethat is uninsured,the higher the probability of havingaccess to healthcare.This indicator is calculatedusing data
306、on out-of-pocket expenditure(percentageof current health expenditure),included in the WBsWDI 2021.The target for this indicator is equal to thesample minimum of 9.25%and the low performancebenchmark is equal to 100%,which means that noneof the population is covered by health insurance.2.The Material
307、 Wellbeing in Retirement Index:this sub-indexmeasures the ability of a countrys population to provide fortheir material needs.The following indicators are aggregated by obtaining their geometric mean to obtain a single measure:a.Income per capita Index:this indicator is calculatedusing data for the
308、gross national income per capita,PPP(current International$)from the WBs WDI 2021.The purchasing power parity(PPP)version is used as itprovides a better approximation to the real purchasingpower of incomes across countries.The target usedfor this indicator is the sample maximum of$92,270USD,and the
309、low performance benchmark is equalto the sample minimum of$6,920 USD.Logarithmictransformation is applied to calculate the indicator.b.Income equality Index:this indicator is included asit has been generally accepted that average levelsof income in a society cannot on their own measurematerial welfa
310、re,and including a measure of equalityensures that countries with higher and more equallydistributed income get a better score.This index is constructed using the GINI index with data obtained from Eurostat,the Organization for Economic Co-operation and Development(OECD),the WBs WDI 2021 and the CIA
311、 World Factbook.The target is set at 22.80,which is the sample minimum.The low performance benchmark is set at 53.90,which is the sample maximum.The index is presented in a logarithmic form.c.Unemployment Index:a measure of unemploymentis included in this index,despite the fact that its focusis on p
312、eople who have already retired from the labormarket.This is because societies with high levels ofunemployment will see their social security systemsunder pressure,putting in danger the financing andprovision of services for the elderly.Moreover,retireesin countries with low unemployment levels will
313、havea better possibility of complementing their pensionincomes with employment income,which is becomingincreasingly necessary and common.High levelsof unemployment are also indicative of a countryundergoing economic problems and it is likely that thiswill affect the living standards of those in reti
314、rement.The target for this index is 3%unemployment,at whichlevel structural and cyclical unemployment can beassumed to be 0 and only frictional unemploymentpersists,which indicates practical full employment.The low performance benchmark is set at 15.50%,which is the sample maximum.The index undergoe
315、sa logarithmic transformation and the raw data usedfor this index was sourced from the WBs WDI 2021.3.Finances in Retirement Index:this sub-index capturesthe soundness of a countrys financial system as wellas the level of returns to savings and investment andthe preservation of the purchasing power
316、of savings.Itis calculated as the arithmetic mean of the institutionalstrength index and the investment environment index,which is in itself the geometric mean of six indicators of thesoundness of government finances and the strength of thefinancial system.The rationale behind this construction isth
317、at while a favorable investment environment is extremelyimportant for the finances of retirees,this will only be longlasting and stable in the presence of sound institutions,low levels of corruption,strong property rights and astrong regulatory framework.Hence,good governanceis a necessary condition
318、 for long-term financial strengthand stability and as much receives an equal weight.a.Institutional Strength Index:is calculated underlogarithms after obtaining the arithmetic meanof the estimates of governance from six differentdimensions(Voice and Accountability,PoliticalStability and Absence of V
319、iolence/Terrorism,Government Effectiveness,Regulatory Quality,Rule ofLaw,and Control of Corruption)of the WBs WorldwideGlobal Retirement Index 202271Governance Indicators(2020 Update).The target level is set equal to the maximum on the scale used by the indicators,which is+2.5,while the lower perfor
320、mance benchmark is equal to the lowest value of the scale,-2.5.b.Investment Environment Index:this is calculatedas the geometric mean of the following indicators:I.Old-age dependency Index:this indicator isincluded because a high dependency ratio posesa severe threat to the capacity of society to pa
321、y for the care of the elderly,as well as risks reducing the value of savings in the long run,through severalchannels such as a fall in asset prices and a fall inoutput,among others.This index is transformedinto logarithms and is calculated using data onold-age dependency ratio(percentage of working-
322、age population)from the WBs WDI 2021.Thetarget value is equal to 10%,which reflects healthydemographics,where for every old-age dependent there are 10 people in the working force.Thelow performance benchmark is equal to 50%,as it is potentially unsustainable to have lessthan two workers for every ol
323、d-age dependent.II.Inflation Index:this is important due to the factthat high inflation will reduce the purchasing powerof savings and pensions,which can affect retirees disproportionately.The data used is on annualconsumer price inflation and is sourced from theWBs WDI 2021.The value for each count
324、ry is thefive-year average from 2015 to 2019.The target is2%,which is a level of inflation pursued by majorcentral banks,and considered to be sufficientlyclose to price stability and sufficiently far fromdeflation to provide some buffer from either.Thelow performance benchmark is set at the samplema
325、ximum 11.62%.This indicator undergoes alogarithmic transformation when calculated.III.Real interest rate Index:this is included ashigher interest rates will increase the returns toinvestment and saving,and in turn increase thelevel of wealth of retirees,who tend to benefitmore than other age groups.
326、Real interest rate isused instead of nominal interest rate to eliminatethe effect of inflation.The data for this indicator is sourced from the WBs WDI 2021 and is completed from the OECD.6,7 The value for each country is the five-year average from 2015 to 2019.The target is 20%and the low performanc
327、e benchmark is 0%.The data is multiplied by 100 before logarithmic transformation applied.IV.Tax pressure Index:the importance of thisindicator lies in the fact that higher levels oftaxation will decrease the level of disposableincome of retirees and affect their financialsituation.Data used is the
328、tax burden from countrystatistical agencies,central banks,and ministriesof finance,economy,and trade,which measuresthe total taxes collected as percentage of GDP.The target is set at the sample minimum of 9.42%of GDP while the low performance benchmarkis the sample maximum of 46.09%of GDP.This indic
329、ator is calculated in logarithmic form.V.Bank non-performing loan Index:this indicatorcaptures the strength of the banking system bylooking at the proportion of loans that are defaulted on.This index is transformed into logarithms andis constructed using the data observed from theIMF Financial Sound
330、ness Indicators database.The target for this index is set equal to the sampleminimum of 0.24%and the low performancebenchmark is the sample maximum of 29.80%.VI.Government indebtedness Index:captures thesoundness and sustainability of governmentfinances and serves as a predictor of future levelsof t
331、axation.The data used for this index is sourcedfrom the CIA World Factbook and undergoesa logarithmic transformation to construct theindex.The target level is set equal to the sampleminimum of 8.40%and the low performancebenchmark is the sample maximum of 237.40%.4.Quality of Life Index:this sub-ind
332、ex captures the level ofhappiness and fulfillment in a society as well as the effectof natural environment factors on the Quality of Life ofindividuals.It is constructed as the geometric mean of thehappiness index and the natural environment index.6 Latest data on annual consumer price inflation and
333、 10-year government bond yields are used to calculate the real interest rate(real interest rate=nominal interest rate inflation)for those countries missing data from the WDI.7 Long-term interest rates are obtained from OECD for the following countries:Austria,Belgium,Denmark,Finland,France,Germany,Greece,Ireland,Latvia,Lithuania,Luxembourg,Netherlands,Norway,Poland,Portugal,Slovak Republic,Sloveni