Australia's retirement system has been ranked by the Melbourne Mercer Global Pensions Index.
According to the ratings, the top 10 are the Netherlands, Denmark, Australia, Finland, Sweden, Norway, Singapore, New Zealand, Canada and Chile.
Australia got a 'B+ rating' according to reporting by the Australian Financial Review and Bloomberg, beaten only by Denmark and the Netherlands which received A ratings.
There were 40 metrics used to assess the different systems on whether a system leads to better financial outcomes for retirees, whether it's sustainable and whether it has the trust & confidence of the community.
The report's author and Mercer senior partner David Knox said "Systems around the world are facing unprecedented life expectancy and rising pressure on public resources to support the health and welfare of older citizens. It's imperative that policy makers reflect on the strengths and weaknesses of their systems to ensure stronger long-term outcomes for the retirees of the future."
After the royal commission, businesses like AMP Limited (ASX: AMP) and IOOF Holdings Limited (ASX: IFL) want to be the choice for retirees and savers, so they're shifting to a more client-focused strategy.
It could be a good move considering the big banks of Commonwealth Bank of Australia (ASX: CBA), Westpac Banking Corp (ASX: WBC), Australia and New Zealand Banking Group (ASX: ANZ) and National Australia Bank Ltd (ASX: NAB) are stepping back from the financial advice sector.
Other businesses are also benefiting from the royal commission fallout including EQT Holdings Ltd (ASX: EQT), Netwealth Group Ltd (ASX: NWL) and Hub24 Ltd (ASX: HUB).
Having a strong retirement system is good for the economy. It means retirees can have more discretionary spending in their golden years and it also hopefully means less money is needed from the government to fund the aged pension. It's good for everybody. The only argument against more money in the superannuation is that it delays short-term spending for the economy.
Foolish takeaway
There are plenty of shares like Challenger Ltd (ASX: CGF) trying to capitalise from the big growth in retirement funds. But a tailwind is not guaranteed to turn into earnings growth, at least over the shorter-term.
