Demographics
The Pension Time Bomb: $400 Trillion by 2050
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The Pension Time Bomb: $400 Trillion by 2050
View the high resolution version of today’s graphic by clicking here.
Are governments making promises about pensions that they might not be able to keep?
According to an analysis by the World Economic Forum (WEF), there was a combined retirement savings gap in excess of $70 trillion in 2015, spread between eight major economies..
The WEF says the deficit is growing by $28 billion every 24 hours – and if nothing is done to slow the growth rate, the deficit will reach $400 trillion by 2050, or about five times the size of the global economy today.
The group of economies studied: Canada, Australia, Netherlands, Japan, India, China, the United Kingdom, and the United States.
Mind the Gap
Today’s infographic comes to us from Raconteur, and it illuminates a growing problem attached to an aging population (and those that will be supporting it).
Since social security programs were initially developed, the circumstances around work and retirement have shifted considerably. Life expectancy has risen by three years per decade since the 1940s, and older people are having increasingly long life spans. With the retirement age hardly changing in most economies, this longevity means that people are spending longer not working without the savings to justify it.
This problem is amplified by the size of generations and fertility rates. The population of retirees globally is expected to grow from 1.5 billion to 2.1 billion between 2017-2050, while the number of workers for each retiree is expected to halve from eight to four over the same timeframe.
The WEF has made clear that the situation is not trivial, likening the scenario to “financial climate change”:
The anticipated increase in longevity and resulting ageing populations is the financial equivalent of climate change
Michael Drexler, Head of Financial and Infrastructure Systems, WEF
Like climate change, some of the early signs of this retirement savings gap can be “sandbagged” for the time being – but if not handled properly in the medium and long term, the adverse effects could be overwhelming.
Future Proofing
While implementing various system reforms like raising the retirement age will help, ultimately the money in the system has to come from somewhere. Social security programs will need to cut benefits, increase taxes, or borrow from somewhere else in the government’s budget to make up for the coming shortfalls.
In the United States specifically, it is expected that the Social Security trust fund will run out by 2034. At that point, there will only be enough revenue coming in to pay out approximately 77% of benefits.
Money
Charted: Retirement Age by Country
We chart current and effective retirement ages for 45 countries, revealing some stark regional differences.

Charted: Retirement Age by Country
The retirement landscape can look completely different depending on what country you’re in. And charting the retirement age by country reveals a lot of differences in the the makeup of a labor force, both for economic and cultural reasons.
This graphic delves into the current and effective retirement ages across 45 nations in 2020, based on comprehensive data from the OECD 2021 report.
Defining Retirement Ages
Before we dive into the numbers, let’s clarify the measurements used by the Organisation for Economic Co-operation and Development (OECD):
- The current retirement age is the age at which individuals can retire without penalty to pension after completing a full career starting from age 22.
- The effective retirement age refers to the average age of exit from the labor force for workers aged 40 years or more.
Many countries have seen workers effectively retire earlier or later than the current retirement age. This variance can arise due to a multitude in factors including differences in career start ages, some industries offering earlier retirements or benefits for later commitments, or countries facilitating different workforce exits due to market demands and policies.
Some people also choose to retire early due to personal reasons or a lack of available work, receiving a smaller pension or in some cases forgoing it entirely. Likewise, some people choose to stay employed if they are able to find work.
Retirement Age by Country in 2020
Here’s a snapshot of the current and effective retirement ages by country in 2020:
Country | Retirement age (Current) | Retirement age (Effective) | Retirement age (Women, Effective) |
---|---|---|---|
🇦🇹 Austria | 65 | 62 | 61 |
🇧🇪 Belgium | 65 | 61 | 60 |
🇨🇦 Canada | 65 | 64 | 63 |
🇨🇱 Chile | 65 | 65 | 61 |
🇨🇴 Colombia | 62 | 67 | 60 |
🇨🇷 Costa Rica | 62 | 67 | 62 |
🇨🇿 Czech Republic | 64 | 63 | 62 |
🇩🇰 Denmark | 66 | 64 | N/A |
🇪🇪 Estonia | 64 | 64 | 65 |
🇫🇮 Finland | 65 | 63 | 64 |
🇫🇷 France | 65 | 60 | 61 |
🇩🇪 Germany | 66 | 63 | N/A |
🇬🇷 Greece | 62 | 61 | 58 |
🇭🇺 Hungary | 65 | 62 | 60 |
🇮🇸 Iceland | 67 | 66 | 64 |
🇮🇪 Ireland | 66 | 64 | N/A |
🇮🇱 Israel | 67 | 65 | N/A |
🇮🇹 Italy | 62 | 62 | 61 |
🇯🇵 Japan | 65 | 68 | 67 |
🇰🇷 Korea, Republic of | 62 | 66 | 65 |
🇱🇻 Latvia | 64 | 66 | 65 |
🇱🇹 Lithuania | 64 | 63 | N/A |
🇱🇺 Luxembourg | 62 | 59 | 60 |
🇲🇽 Mexico | 65 | 66 | 63 |
🇳🇱 Netherlands | 66 | 64 | 63 |
🇳🇿 New Zealand | 65 | 68 | 66 |
🇳🇴 Norway | 67 | 65 | 63 |
🇵🇱 Poland | 65 | 62 | 60 |
🇵🇹 Portugal | 65 | 65 | 63 |
🇸🇰 Slovakia | 63 | 60 | N/A |
🇸🇮 Slovenia | 62 | 62 | 61 |
🇪🇸 Spain | 65 | 61 | 60 |
🇸🇪 Sweden | 65 | 66 | 65 |
🇨🇭 Switzerland | 65 | 65 | 64 |
🇹🇷 Türkiye | 52 | 61 | 59 |
🇬🇧 United Kingdom | 66 | 64 | 63 |
🇺🇸 United States | 66 | 65 | N/A |
🇪🇺 European Union (Average) | 64 | 63 | N/A |
🇦🇷 Argentina | 65 | 62 | 63 |
🇧🇷 Brazil | 62 | 62 | 59 |
🇨🇳 China (People's Republic of) | 60 | 66 | 61 |
🇮🇳 India | 58 | 67 | N/A |
🇮🇩 Indonesia | 57 | 69 | N/A |
🇷🇺 Russia | 62 | 62 | 60 |
🇸🇦 Saudi Arabia | 47 | 59 | N/A |
🇿🇦 South Africa | 60 | 60 | 56 |
Three countries had the highest current retirement age at 67 years, Iceland, Israel, and Norway, but all had slightly lower effective retirement ages on average. On the flip side, Saudi Arabia had the lowest current retirement age at only 47 years with full pension benefits. Only Türkiye at 52 years was close, and notably both had much higher effective retirement ages on average.
Discrepancies between different regions are clear across the board. Many Asian countries including China, India, and South Korea have official minimum retirement ages in the early 60s and late 50s, but see workers stay in the workforce well into their late 60s. Meanwhile, most European countries as well as the U.S. and Canada have more workers retire earlier than minimum retirement ages on average.
Almost all of the countries with measured effective retirement ages for women also saw them exit the workforce earlier than men. This can be the result of cultural gender norms, labor force participation rates, and even the setup of pension systems in different countries.
The five exceptions in the dataset where women retired later than men? Argentina, Estonia, Finland, France, and Luxembourg.
Looking to the Future
In 2023, France sparked controversy by raising its early retirement age by two years. This decision triggered widespread strikes and riots and ignited debates about the balance between economic sustainability and individual well-being.
Given aging demographics in many developed countries and a continued need for labor, this isn’t expected to be the only country to reassess retirement. The OECD projects a two-year increase in the average effective retirement age by the mid-2060s.
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