Retirement assets lean heavily on bonds and equities, which represent 70% of pension plans and nearly 90% of public reserves. Bonds are favoured for their stability, low risk and regulatory obligations, while equities have higher returns but also higher risk. In 2022, both bonds and equities fell globally, leading to negative returns for pension systems.

In Europe, women generally accrue less in retirement savings than men, with the gap emerging in the 25-34 age group and widening thereafter. Initially, both genders start with similar pension assets, but by ages 25-34, women have 8% less, and by 35-44, the gap widens to 30%, due to career breaks (usually maternity leave) and the gender wage gap. The disparity peaks between ages 55-64, reaching 34%, resulting from historical differences compounded by investment returns.

Savings for retirement and returns on investment are tax-exempt in most countries while pension benefits are taxed.

EET, TEE and TTE are different pension plan taxation models, each named after the tax treatment of contributions, investment earnings and withdrawals. The main difference between these models lies in the timing of when retirement savings are taxed. EET defers taxes until retirement, TEE taxes contributions but exempts investment earnings and withdrawals, and TTE taxes contributions and investment earnings but exempts withdrawals.

This publication provides an annual overview of how countries design financial incentives to promote savings for retirement.

Most countries have quantitative investment limits, usually expressed as a maximum proportion of assets that pension providers are allowed to invest in a specific type of instrument or vehicle. The legislation may also include specific rules on foreign investments, investments in a single issue or issuer and other quantitative restrictions applying to pension providers.