South Africa is ranked among the worst countries in the world when it comes to retirement, according to a new report.
The Global Retirement Index, compiled by Natixis Global Asset Management, assesses 150 countries in the world on four key areas relating to retirement.
The index looks at retirement security in each country in terms of material well-being (ability to live comfortably), health (quality of health services), finances (quality of financial services) and quality of life.
Of the 150 countries evaluated in 2015, South Africa ranks 130th – the 21st worst country for retirees in the world.
And the country on the Southernmost tip of Africa has gotten steadily worse in recent years, having placed 115th in 2014, and 99th in 2013.
South Africa’s overall Index score for 2015 was 34% (2014: 40%), with the highest-performing indicator being the country’s financial sector (64%).
In 2013, the country scored 49%.
When it comes to material well-being, however, SA scored only 8% – the lowest score out of all 150 countries.
The material well-being sub-index measures factors such as individual income, the availability of jobs (unemployment levels) and income inequality.
The report pointed out that in economic terms, SA scored very poorly when it comes to levels of income per capita, while it has one of the highest rates of income inequality in the world.
“The range between the top score in the material well-being sub-index and the bottom one is 87%, signaling an extreme discrepancy of material wealth between the richest and poorest countries,” the report said.
|Quality of life||54%|
10 Best places to retire
For the second year in a row, Switzerland and Norway have claimed the first and second positions in the ranking, respectively.
The top countries are dominated by Nordic nations, with Australia and New Zealand also making it into the top 10.
“Switzerland has an extremely high quality of life and an outstanding healthcare system, and is one of the world’s leading financial centers as a result of its track record, strong fundamentals and solid regulatory framework,” the report said.
However, it is noted that Switzerland’s status as a “safe haven” has proven to be a double-edged sword.
The government has been able to borrow cheaply, which has put pressure on the Swiss franc, ultimately forcing the central bank to take extraordinary measures to avert further appreciation of the currency.
“This has resulted in negative interest rates, which penalizes savers and affects retirees disproportionately,” Natixis said.
10 Worst places to retire
The worst places to retire are dominated by African nations, with West African nation Togo, claiming the last spot.
In 2014 and 2013, Zimbabwe was the lowest-ranked country in the world, but in 2015 it climbed to 133rd.
“Due to high levels of pollution and few resources in terms of disease prevention, these nations score low in the Quality of Life/Natural Environment sub-index, with most countries scoring under 50% and the lowest score being 7% for Togo,” the report said.
Similarly, the health index scores do not go above 40% (except for South Africa with 50%), while the lowest score is 8% for Sierra Leone.
“This is due to an under-developed healthcare system, poor medical infrastructure and low levels of physicians per capita, which results in low life expectancy and high infant mortality rates.”
|149||Central African Republic||23%|
|148||Democratic Republic of Congo||23%|