Hello Lykkers, When you think about retirement, one big question usually comes to mind: Will the pension system really support me when I need it most? That's where the Global Pension Index (GPI) comes in.

Each year, it evaluates and ranks pension systems across countries, offering valuable insights into how well different nations are securing the financial futures of their citizens.

Let's explore what the Global Pension Index is, why it matters, and what it reveals about financial security around the world.

The Mercer CFA Institute Global Pension Index is one of the most widely respected benchmarks of pension systems. It assesses retirement income systems in dozens of countries and ranks them based on three key factors:

1. Adequacy – How well pensions provide for retirees' needs.

2. Sustainability – Whether the system can keep supporting future generations without collapsing under financial pressure.

3. Integrity – The level of governance, regulation, and protection to ensure fairness and trust.

By combining these indicators, the Index paints a picture of how secure—and how risky—retirement systems are in different parts of the world.

Why the Index Matters

For individuals, the Index provides perspective on how reliable their country's pension system is. For policymakers and investors, it highlights strengths and weaknesses that can guide reform and financial planning.

The importance is clear: as populations age and people live longer, the financial strain on pension systems is growing. According to the World Bank, the global population over 60 is projected to double by 2050, putting immense pressure on existing pension frameworks.

Key Findings the Index Reveals

1. No Perfect Pension System Exists

Even the highest-ranked countries face challenges. For instance, strong systems often balance generous retirement benefits with strict financial sustainability measures, but this balance is tough to maintain over decades.

2. Sustainability Is the Weakest Link

Many pension systems score well on adequacy but struggle with sustainability. Longer life expectancies, fewer working-age contributors, and economic volatility threaten the ability of systems to last.

3. Diverse Approaches Create Different Results

Countries that mix public pensions with private savings schemes usually rank higher, as they diversify risk. Systems relying solely on state funding often face deficits.

4. Financial Literacy and Participation Matter

The Index consistently shows that encouraging people to save early and understand retirement planning boosts long-term financial security.

What It Means for Financial Security

The Global Pension Index reminds us that financial security in retirement is not just about what governments promise—it's about shared responsibility among individuals, employers, and the state.

- For governments, the message is to reform systems now to handle demographic and economic shifts.

- For businesses, it's about supporting employees with pension contributions and education.

- For individuals, the takeaway is clear: don't rely solely on state pensions—building personal savings and investments is critical.

Looking Ahead

Lykkers, the Global Pension Index is more than a ranking—it's a mirror reflecting how prepared (or unprepared) societies are for the retirement challenge. With people living longer and economies facing uncertainties, strengthening pension systems is essential for global financial stability.

The lesson? Secure retirement requires foresight, collaboration, and continuous improvement. For investors, workers, and policymakers alike, the Index offers a roadmap: strong pensions mean stronger financial security for everyone.