Discover the Best and Worst Countries to Retire in Europe: A Comprehensive Analysis.
If you’re considering a move to Europe for your retirement, recent findings from US consultancy Mercer shed light on the best and worst countries to retire in the region.
According to Mercer’s annual report analyzing retirement income systems worldwide, Iceland, Netherlands, and Denmark emerge as the top three European nations with the most robust pension systems.
Best Countries for Retirement in Europe
Iceland (Average: 84.6): Leading the pack with an average score of 84.6 over the past three years, Iceland boasts an exceptional retirement income system.
Netherlands (Average: 84.4): Consistently strong, the Netherlands secured an average score of 84.4, making it one of the top destinations for retirees.
Denmark (Average: 81.8): With an average score of 81.8, Denmark’s pension system has proven reliable and efficient for retirees.
Key Metrics in Mercer’s Index
The Mercer Index evaluates pension systems based on three key metrics: adequacy, sustainability, and integrity.
Adequacy: In this category, Portugal claimed the top spot globally with an impressive score of 86.7. The Netherlands followed closely with a score of 85.6. On the flip side, Poland ranked 31st globally, scoring 59.8.
Integrity: Finland demonstrated the highest integrity score in 2023, reaching an impressive 90.9. Belgium secured the second position with a score of 88.2, while the Netherlands ranked third at 87.7. France, surprisingly, was the lowest-performing European nation with a score of 54.4.
Sustainability: Iceland led in sustainability with a score of 83.8, followed by Denmark (82.5) and the Netherlands (82.4). Conversely, Italy scored the lowest in Europe for sustainability with a rating of 23.7, closely followed by Spain at 28.5.
Insights from Mercer
According to Eimear Walsh, Mercer’s Head of Investments and Wealth, the success of Iceland, Netherlands, and Denmark can be attributed to large industry funds, defined contributions from both workers and employers, and mandatory or quasi-mandatory schemes.
These countries benefit from robust economies of scale compared to more fragmented markets like the U.K. for occupational pensions.
While these top European retirement destinations shine, popular choices like Spain, Italy, and Croatia have reported shortcomings, making Mercer’s insights invaluable for those planning their retirement in Europe.
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