Rounding out the top 10 were New Zealand (6th), Australia (7th), Canada (8th), Denmark (9th) and Germany (10th). Germany, the report noted, jumped from 13th place last year due to higher scores in the quality of life, health and finances sub-indices.
The report said that low interest rates have been a drag across the world: 16 nations ranked in the GRI saw their five-year average for real interest rates move into negative territory. In 2016, when the GRI methodology was adjusted to use a weighted five-year average of real interest rates as part of the Finances in Retirement category, the U.K. was the only country with negative rates.
Edward Farrington, head of retirement strategies at Natixis Investment Managers, explained that when the economy and markets are in crisis, interest rates are the go-to tool for central bankers looking to stimulate spending and the markets. But the cuts raise the stakes on retirement security.
“From an individual perspective, low rates are generally good because it costs less to borrow money, but for retirees, negative rates magnify the problem they face in generating income from investments," Farrington said in a statement. "The implications of negative interest rates likely will continue to affect retirees for many years ahead.”
The report cited falling interest rates as one of the five greatest threats for retirement security in the future. Lower rates, it said, may require individuals and institutions to be more creative about how they prepare to meet longer-term needs and commitments.