The Global Retirement Index (GRI) is a tool that allows us to know how countries are doing with respect to the prospects and possibilities that their citizens have of accessing a decent pension after fulfilling the requirements established by law, regardless of the conditions. This allows us to determine how much progress has been made in this area and what challenges remain.
According to Natixis Investment Managers, the firm in charge of carrying out this analysis, retirement conditions will remain stable in 2024 and almost all developed countries have improved their retirement security score, taking into account that the vast majority have achieved better results than in 2023, thus overcoming the crisis that originated during the pandemic.
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However, the results also suggest that people are feeling the pressure as more people realise they are on their own when it comes to funding income for later life and that as social dynamics change, new challenges are being generated on this front.
“In this year’s index, Switzerland has displaced Norway from the top spot with a total score of 82%, putting Norway (81%) in second place. However, the countries in the top 10 remain unchanged, with Iceland (3rd), Ireland (4th) and Australia (7th) maintaining their positions. Germany and Denmark move up one place from last year, taking 8th and 9th places, while the Netherlands overtakes Luxembourg in 5th place, pushing Luxembourg down to 6th place in the process,” they reported.
Longevity
According to Natixis, this ranking is carried out in collaboration with Core Data Research. and provides a global benchmark that incorporates a wide variety of factors essential to people enjoying a healthy and secure retirement. These include important financial factors, as well as considerations such as access to and cost of health care, climatic conditions, the state of governance and the general happiness of the population.
“GRI rankings are relative, not absolute, and are based on an aggregate of mean scores from 0% to 100% for 18 performance measures in each of its four sub-indexes – Retirement Finances, Material Well-Being, Health and Quality of Life – which are combined to provide a comprehensive picture of the environment for retirees,” the report says.
Colombia cracked
While things have improved substantially globally, this was not the case for Colombia, which this year ranked 43rd, dropping two positions from 41st in 2023. This is because its overall score fell from 37% to 33% year-over-year.
“Colombia shows an increase in two of the four sub-indexes: Health and Quality of Life. The country’s score on the Retirement Finances sub-index declines slightly, with a larger drop in the Material Well-being sub-index,” Natixis said in this regard.
As for the overall national ranking in Health, the study notes that it remains in 40th place, but its score has improved by two percentage points compared to last year, thanks to an upturn in the per capita health expenditure score, while the rankings for life expectancy and expenditure on insured health have remained stable.
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On the other hand, it is also said that despite a weaker performance in life expectancy and health expenditure per capita within the GRI, Colombia It stands out in spending on insured health, occupying 14th place with an almost perfect score of 94%.
“The Retirement Finances sub-index remains Colombia’s best-performing category in terms of overall score, although it has fallen four places, from 26 to 30 compared to last year. Despite a decline in the overall performance of this sub-index, Colombia remains in the top ten in three of the seven indicators: interest rates (3rd), old-age dependency (4th) and tax pressure (4th),” they indicated in another section.
Old age
Regarding the causes that would also influence this result, Natixis It was highlighted that “Colombia’s material well-being score has decreased by five percentage points, driven by declines in the unemployment and income inequality indicators, while the per capita income indicator has increased slightly year-on-year, but is not enough to offset the progress of other countries in this indicator, leaving Colombia in 42nd place.”
“Therefore, the national ranking in the Quality of Life sub-index remains stable at 39th place overall, despite a one percentage point increase in the score, reaching 58%. The country’s scores remain consistent in all aspects of this sub-index, except for the Happiness indicator, where Colombia registers a three percentage point increase compared to the previous year,” they concluded.
It is not all bad news, as this report closes by saying that Colombia maintains its leadership position in the environmental factors indicator (1st) with a score of 84%, thanks to its impressive achievement in renewable energy, producing around 75% of its electricity from renewable sources, more than double the global average and significantly higher than the 60% in Latin America and the Caribbean.
