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Saving for retirement is one of those things that only become a priority when it’s almost too late, and if you’re only means of income in your later years is SASSA, you might want to get your Uber license now.

The Mercer Institute’s global pensions report recently looked at 47 pension systems across the world, to see how the recent bout of worldwide chaos has affected retirement. The latest report however also looked at how AI systems are impacting governments’ approach to retirement.

Not too surprisingly, the Netherlands is top of the class when it comes to pension systems around the world, based on 50 indicators and comparing 47 retirement income systems, covering 64% of the world’s population. The level of ‘accessible private and public sector pension benefits’, the system’s ‘potential to be sustained for many years to come’, and the ‘effectiveness of its governance’ were the most important metrics.

According to the index, Iceland was bumped to the second spot, and Denmark came in third.

The vast majority of the European nations profiled in the report received favourable grades. According to the report, Finland, Norway, Sweden, the UK, Switzerland, Ireland, Belgium, Portugal, and Germany just require a few improvements to compete with the top three.

India, the Philippines, and Argentina are in last place on the list. They share the lowest rating, D, with Turkey and Thailand, indicating that without changes, the sustainability of the pension systems in these nations are in doubt.

South Africa’s pension system is ranked 34th out of 44 countries and garnered an overall C grade due to ‘some shortcomings’ according to the report.

“The average age of populations around the world continues to rise in many markets, mainly more mature markets,” said Margaret Franklin, president and CEO at the CFA Institute.

“Inflation and rising interest rates have created a new market dynamic that poses significant challenges to pension plans. We also see continued fracturing as it relates to globalization,” she added. “These are just a few of the increasingly complex challenges that pension funds face that impact retirees in significant ways.”

The report also found that artificial intelligence can improve pension performance by cutting costs and highlighting upcoming risks better than most fund managers can.

“The ongoing expansion of AI within the operations and decisions of investment managers could lead to more efficient and better-informed decision-making processes, which could potentially lead to higher real investment returns to pension plan members.”

One issue that was however only slightly touched on was the risk associated with AI being used to create ‘fake information’ and launch cyber-attacks against pension schemes.

As with most things AI related, the issues were only highlighted, and no real solutions were offered. AI is a waiting game – we’re all waiting to see how it unfolds.

Meanwhile, speaking to financial advisors like the team at Consequence Private Wealth, who partner with you and your family to protect and build your wealth, will help with a better understanding of the protections on offer to best prepare for anything retirement can throw at you.

[source:euronews]