RIYADH: As a result of continuous reforms, Saudi Arabia’s Global Pension Index score increased to 60.5 in 2024 from 59.5 the previous year, according to a recent report.
The Kingdom’s pension system rating was raised from C to C+ in the most recent Mercer CFA Institute Global Pension Index, putting it on par with the US, the UAE, and Spain.
According to the ranking, a C+ system has good features but substantial hazards that require attention. The Saudi Arabian retirement system offers both a lump-sum reward and an earnings-based pension; individuals who are not eligible for monthly payouts only receive the one-time benefit.
In an effort to promote longer workforce engagement and lessen the financial burden on the pension system, the reform also extended the necessary contribution period for early retirement from 25 to 30 years.
As more private pension options are offered to supplement current retirement plans, Saudi Arabia stands to gain from its ongoing reforms and improvements to its pension system, according to Tarek Lotfy, president of Mercer in India, the Middle East, and Africa.
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