When it comes to retirement security, it's a sweep for northern Europe.Norway, Switzerland, and Iceland won the top three spots in Natixis Global Asset Management's fourth annual ranking, released this week, followed closely by New Zealand. Australia, with a score of 78 per cent, ranked sixth out of 43 nations in the global retirement index. Norway joins a number of top countries on the list in having a compulsory workplace savings program. It requires employers to fund private retirement accounts with 2 per cent of a worker's earnings earnings annually. "Additional provisions allow for more paternal employers to fund an additional, voluntary defined contribution plan at 3 per cent to 6 per cent," according to the report. But that still pales next to Australia, where employers must kick in at least 9.5 per cent. The retirement leaders, with scores of 77 per cent or better were Norway, Switzerland, Iceland, New Zealand, Sweden, Australia, Germany, the Netherlands, Austria, and Canada. The bottom 10, whose highest score was 57 per cent: India was last, at 12 per cent, preceded by Greece, Brazil, Russia, Turkey, China, Spain, Cyprus, Mexico, and Portugal. 

 At first glance, it looks as if the US (ranking 14th with 73 per cent) made a big jump from last year, when it came in 19th. But that result isn't apples-to-apples. This year's report focussed mostly on developed nations, while last year's ranked 150 countries. The methodology changed, too, to a five-year average for real interest rates and inflation, up from a three-year average. That affects a part of the index called "finances in retirement," one of the report's four sub-indexes that determine the overall ranking. If the new methodology had been applied to last year's data, the US would have come in 15th.The world's largest economy didn't reach the top 10 in two of the four sub-indexes, including the one that measures the stability of finances in retirement, which gets the most weight in the overall ranking: This sub-index looks at the ratio of working people for every retirement-age person, the level of bank non-performing loans, inflation, interest rates, tax pressure, government indebtedness, and governance. The US score was damped by the nation's "relatively high levels of public debt and increasing tax burdens." As the report said, "rising expenses in the long term seem inevitable as more boomers reach retirement age." A 2015 Natixis survey of US pension plan participants found 60 per cent saying they put from 1 per cent to 7.5 per cent of salary into a retirement account, with 40 per cent of those people contributing from 1 per cent to 5 per cent. Many respondents cited personal debt as an obstacle to saving more.One area in which the world's largest economy had an abysmal ranking was in its high level of income inequality, which helped drive it down to No. 37 of the 43 countries. The US and Singapore share the dubious distinction of being the only countries in the top five for income per capita and in the bottom 10 for their large gaps in income equality. Those data points fall into the "material wellbeing" portion of the index, where the US scores 59 per cent to sit at No. 25, below Estonia. That's its lowest score among the report's four sub-indexes, below its No. 16 rank for quality of life.

 It's worth watching interest rates, which could cause rankings to shift in future years. Low rates are great if you're buying a house or a car, but they stink if you're trying to live on a fixed income in retirement. While Norway, which has started to cut interest rates, is ranked No. 1 overall, No. 1 in material well-being, and No. 3 in the quality of life and health categories, it is No. 9 in the retirement finance measure. If Norway continues to cut rates, "I'll be curious to see what long-term impact that has on its ranking," said David Goodsell, who oversees investor research for Natixis.Right now, though, only Denmark, Switzerland, and Iceland top Norway in the report's measure of contentment. When it comes to retirement, the Norwegians are looking pretty fat and happy.Bloomberg