The west European nation has again been named as having the best pension system in the world in the latest Mercer CFA Institute Global Pension Index for 2025.
Singapore has broken into the top tier of the global pension index for the first time, while Denmark, Israel, and Iceland make up the rest of the five countries that scored an “A” rating.
The report evaluated 52 retirement systems around the world. The final scores are based on grades for a pension’s adequacy, sustainability and integrity.
The Dutch scheme
So, what makes the Dutch system so good? In short, it’s fair, reliable and built to last.
Almost everyone working in the Netherlands is automatically part of a pension plan. Workers and employers both contribute, and there’s also a strong state pension that ensures no one is left behind.
“The Netherlands’ retirement income system comprises a flat-rate public pension and quasi-mandatory earnings-related occupational pension schemes linked to industrial agreements,” the report read.
On top of that, the money is carefully managed through strict regulation, making it one of the most secure systems anywhere in the world.
The Netherlands scored 85.4 out of 100, earning an “A” grade. It was followed closely by Iceland, Denmark, Singapore and Israel, which all have well-organised, sustainable pension systems that balance good benefits with long-term stability.
This year’s findings were mostly positive – no country’s rating dropped, and eight countries improved.
Pension savings are also growing globally, helped by stronger financial markets. But the report warns that people are living longer and having fewer children – a combination that puts extra pressure on governments and workers to save more for the future.
What about pensions in South Africa?
At the other end of the scale, India, Argentina, Turkey and the Philippines were rated as having the weakest systems, all earning “D” grades.
India came last overall, with a score of just 43.8, mainly because many workers have little or no retirement savings.
South Africa, meanwhile, finds itself stuck in the middle – scoring 51.0, which earned it a “C” grade. That still puts it well below the global average of 64.5.
South Africa’s pension setup has two main parts – a state old-age grant for poorer citizens, and a voluntary workplace savings system for those who can afford to save.
From 1 September 2024, the country introduced a major reform known as the “two-pot retirement system.”
The goal with this system is to stop people from cashing out all their savings before retirement, while still giving them some flexibility when money is tight.
