US retirement system earns just a C+ in global study

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Financial planner Sean Caldwell and son Jacob Caldwell discuss the benefits of saving early in life on 'The Big Money Show.'

In a new ranking of global retirement systems, the U.S. notched a C+ grade that puts it on par with nations like Kazakhstan, Colombia, Spain and France. 

The new Mercer CFA Institute Global Pension Index, released Tuesday, rates retirement income systems across the world by using the weighted averages of adequacy, sustainability and integrity.  

The C+ rating means that America's retirement system «has some good features but also has major risks and/or shortcomings that should be addressed; without these improvements, its efficacy and/or long-term sustainability can be questioned,» according to the study.

The U.S. scored 63 out of 100 possible points, coming in 22nd place out of the 47 countries examined. 

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«Retirement savings coverage and institutional quality retirement vehicles remain out of reach for many Americans, creating a significant adequacy gap that needs to be addressed,» Katie Hockenmaier, partner and U.S. defined contribution research director at Mercer, said in a statement. 

A couple reviews their retirement plan at their home. (IStock / iStock)

The three most common sources of retirement income in the U.S. are Social Security benefits, employee pensions and personal savings – a trio dubbed the «three-legged stool» by financial planners.

Not every worker has access to a retirement-savings plan through work. More than half of Americans did not qualify for a retirement plan through their job, according to a recent study by the Economic Innovation Group.

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