Those international “best places to retire” surveys usually point to warm and cheap countries in Central and South America. However, in many ways, the beautiful northern places like Norway, Denmark, Finland and Iceland are probably better.
This is my conclusion after looking at the World Happiness Report 2024, the Natixis Global Retirement Index 2023 and the Mercer CFA Institute Global Retirement Index 2023, as well as talking to their creators.
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And after vacationing in Norway where I talked to an old friend who is a semi-retired US expat married to a Norwegian pensioner, I came away even more persuaded that you may want to consider the Nordic region if you are thinking about retirement abroad.
indeed.
‘I like paying taxes’
“For me, Norway is a magical place,” says my friend Nina Berglund, a digital editor and former Californian. “We have a good pension and I feel very good here. But we have also contributed a lot (in taxes) of course.
Adds her husband Morten Most, a retired journalist: “You often hear Norwegians say, ‘I like paying taxes,’ and to a certain extent that’s true because the hope is that your taxes will benefit you.”
Norway’s steep sales tax, 1.1% annual wealth tax on assets over $160,000 and the national Norwegian Oil Fund help pay for a government-provided pension plus nearly free health care, long-term care and college education. Employers must also provide pensions.
In Norway, Berglund says, if you need home care or a nursing home, “everything is covered.” Copays for doctor appointments are about $25, he noted. Hospital stays, X-rays, MRIs and CAT scans are usually covered by government healthcare.
Pensioners living in Norway only pay tax on the income they receive there (22% to 39%). No inheritance tax and low estate tax by US standards.
“I don’t feel stressed,” Paling said. “Time flies so fast. I have a good retirement.”
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High ranking for retirement and happiness among people 60+
Indeed, Norway is ranked No. 1 in the Natixis Global Retirement Index for the third year in a row. The index measures retirement security by looking at health, finances in retirement, quality of life and material well-being.
Norway is also the third happiest country for people 60 and older in the World Happiness Report, based on citizens’ assessment of life. Denmark tops the World Happiness Report and the US ranks No.
Along with nearby Sweden, Norway scored a B in the Global Pension Index, calculated by crunching data on the adequacy, sustainability and integrity of each country’s pension income system. Denmark got an A.
Some Nordic countries are also very safe. In the Numbeo Global Security Index 2024, Iceland ranks 18th, Denmark 20th, Finland 23rd, Norway 39th; The United States is 88.
What makes these countries score so well?
Why do the Scandinavian countries of Norway, Denmark and Sweden along with Nordic countries like Finland and Iceland consistently do well in these types of surveys?
The countries that top the World Happiness rankings, said John Helliwell, the lead researcher for the study, seem to have “good connections, high levels of trust and care for each other.”
“I tend to think that it’s a holistic view of what they have,” said David Goodsell, executive director of the global research program, Natixis Center for Investor Insight, which publishes the Global Retirement Index. “If you’re not worried about health care or want to (be able to) go back to school when you retire,” he added, “it’s going to affect how you feel.”
David Knox, who heads Mercer’s Global Pension Index, called what he called the “social compact” of these countries among residents and also between residents and governments.
“Each generation expects to support, and then receive from, the next generation,” he said. “It’s a less individualistic society” than in the United States, Knox added.
Two other factors Goodsell cited: a stable economy and a small population – combined, the Nordic countries have fewer people than Canada.
When setting pension policy, Knox said, “I think it’s easier for smaller states to say: ‘This is what we’re going to do.'”
Employers also tend to be paternalistic in the Nordic countries, which also helps with pensions. “In Denmark, more than 80% of the working-age population has a pension account,” Knox said. “It’s higher than in America.”
Good pension system, happy citizens
Knox is not surprised that many Scandinavian and Nordic countries score well in the World Happiness Report and the Global Retirement Index.
As people approach retirement, he said, if their government is under financial pressure, “they may worry, ‘Are they going to cut the state pension and I can retire?’ But if I’m in a system like Norway, which has the confidence of the Oil Fund, there’s an element of ‘I’m happy I’ll retire here’ and there will be support from the government, whether it’s in pensions or health care or whatever.
Not in the ‘best places to retire’ ranking
Interestingly, the annual Best Places to Retire survey by International Living and Live and Invest Overseas does not included Nordic countries in the ranking. I asked what made it.
Donal Lucey, head of digital content at International Living, cited the cost of living which, he said, “can be prohibitive for retirees.”
It’s true that gas and groceries can be high in the region, but rents are cheaper in Oslo, Copenhagen and Stockholm than in New York City, according to Numbeo.
Lucey called the visa and residency requirements in the Nordic countries “strict,” because those countries do not have retirement visa programs like those in Portugal and Mexico.
“U.S. retirees must navigate complex immigration laws,” Lucey said. “And without significant financial means, securing long-term occupancy can be difficult,” he said. In Norway, it takes three years to become a resident.
Live and Invest Overseas publisher Kathleen Peddicord said: “My quick, perhaps vague, response is that we don’t talk about the area because the weather is bad and the costs are all too high.”
“As a retiree shopping the world map for options to live better in whatever budget you’ve got,” he added, “you’ve got a lot of better options than the cold, dark, overpriced countries in Northern Europe that don’t really want you. abide.”
That’s something of an overstatement.
freezing? Often, but not in the summer. “I love the change of seasons,” Berglund said. “We are still very active. We ski.” However, he admits, “winter for many parents, and for many Norwegians, is very difficult.”
Dark? Yes, in some parts of the year, but not others.
Don’t want you there? That was not my experience as a tourist, not what I heard from my expat friend and his wife.
Instead, it helps to live with what Denmark calls “hygge” – enjoying the simple pleasures in life.
Advice for pre-retirement
The researcher of the World Happiness Report, Halliwell, said that instead of looking for a good place in the world to retire, visit some of the happiest countries to see what explains that feeling and then try to replicate it after returning home.
“Apply Nordic lessons where you’ve lived,” he said. “It’s not about where you can make the most money.”
