Report: U.S. Pension System Ranks 13th Among World’s Largest Economies; Faces “Major Shortcomings”


Mercer has released its 2014 Melbourne Mercer Global Pension Index report, which ranks the pension systems of the world’s 25 most advanced economies.

The report grades pension systems on coverage, governance, investment performance, tax support and plan design, among other criteria.

The United States’ pension system ranked 13th overall, which equates to a “C” grade.

The report included a brief summary of how the U.S. could improve their ranking:

The overall index value for the American system could be increased by:

– raising the minimum pension for low-income pensioners

– adjusting the level of mandatory contributions to increase the net replacement for median-income earners

– improving the vesting of benefits for all plan members and maintaining the real value of retained benefits through to retirement

– reducing pre-retirement leakage by further limiting the access to funds before retirement

– introducing a requirement that part of the retirement benefit must be taken as an income stream.

Here are the overall rankings:

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Read the full report here.

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