The State is ranked as the fourth best country worldwide for people to enjoy retirement in a global retirement index compiled by investment managers, Natixis. The study measures security in retirement across four areas – health, finance, quality of life and material wellbeing.
The State’s performance has improved dramatically over the past decade. Back in 2013, Ireland was ranked 25th.
This year, it ranks behind only Norway, Switzerland and Iceland in the study that measures retirement in 44 states worldwide. The ranking puts Ireland just ahead of Luxembourg, with the Netherlands, Australia, New Zealand, Germany and Denmark rounding out the top 10. The UK ranks 16th this year and the US, 20th.
India props up the list just below Brazil, Turkey, Colombia, Mexico, Russia and China.
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Ireland’s 21-place surge has been the most dramatic among the 25 leading countries for retirement, the report says. Iceland has also performed well over that time, jumping 11 places to third. On the flip side, Sweden and France have slipped eight places in the table since 2013, to 15th and 23rd respectively.
The fall in unemployment and better income equality boosted the State’s score under the heading of material wellbeing this year. It also benefited from improvement under the broad heading of finance, where higher interest rates and relatively benign tax pressure were seen as positives alongside better figures for government indebtedness and non-performing bank loans. This was offset partly by rising inflation.
The health and quality of life scores dipped marginally for Ireland, the former due to the impact of the pandemic on life expectancy and the latter due to declines in indicators of happiness and biodiversity and habitat.
Natixis, which has been publishing the index for the past 12 years, says that, for the first time in a decade, optimism among industry professionals about retirement security is growing as inflation eases, unemployment hovers near historic lows, interest rates are on the rise and the pandemic is receding.
However, that is not reflected in the views of 8,550 people surveyed in 23 of the countries in the report. Close to half (48 per cent) of those still working say it is going to take a miracle to be able to retire (financially) securely – a 20 per cent increase on the figure just two years ago.
More than two-thirds (68 per cent) say the rising cost of living in recent years has significantly hurt their ability to save for retirement.
Inflation now ranks as the top concern for 62 per cent of retirees and 57 per cent of workers, according to the Natixis report, surpassing issues such as taxation and meeting the cost of sudden unexpected large expenses that usually rank as the number one concern.
More than half of those surveyed believe they will have the financial freedom to do what they choose in retirement, according to the report. But one in five (21 per cent) believes they will be “stuck having to work”, while a similar number expect they will have to move home to somewhere less expensive. Close to three in 10 (28 per cent) say they will have no choice but to live frugally.
More than one in 10 (12 per cent) say they will have to rely on family and friends to make ends meet while 10 per cent are resigned to having to sell their family home to provide cash resources.
Among the 998 respondents who have already retired 53 per cent are happy with their position. However, three in 10 say their finances are tighter than they had expected with another one in 10 saying that they are barely surviving financially. Three per cent say they had to go out and find a job again.
The survey was conducted in March and April of this year.
