The United States’ retirement income system comprises a social security system with a progressive benefit formula based on lifetime earnings, adjusted to a current dollar basis, together with a meanstested top-up benefit; and voluntary private pensions, which may be occupational or personal.

The overall index value for the American system could be increased by:

  • raising the minimum pension for low-income pensioners
  • adjusting the level of mandatory contributions to increase the net replacement for median income earners
  • improving the vesting of benefits for all plan members and maintaining the real value of retained benefits through to retirement
  • reducing pre-retirement leakage by further limiting the access to funds before retirement

  • introducing a requirement that part of the retirement benefit must be taken as an income stream

The American index value fell from 57.9 in 2014 to 56.3 in 2015 primarily caused by increasing life expectancy and a reduced estimate of funding available from social security contributions.


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