Eight countries have better retirement provisions in place than the UK after the UK's rating dropped following recent pension reforms.
The UK scored 65 points on Mercer's Global Pension Index, down from 67.6 in 2014, due to the removal of the requirement for people to purchase annuities upon their retirement.
The report suggested that the UK's index value could be increased by reinstating the requirement to receive part of the pension as an income stream, raising the minimum pension for low-income pensioners and increasing the retirement age.
The annual report assesses the retirement income systems of 25 countries based on 40 categories that include savings, tax support, demography, regulation and communication.
The UK scored ninth overall, but fell to 14th place on the adequacy sub-index, which tracks the minimum pension provisions, and ranked 12th on the sustainability sub-index, measuring the proportion of workers aged 55 to 64 and the number of people enrolled in private pension plans.
However, the UK was the fourth best country on the integrity sub-index, because of its strong prudential regulator, regular communications with retirees and clear funding requirements.
Denmark 'the world's happiest country'
The report found for the fourth consecutive year that Denmark was the best place in the world for retirees with an index value of 81.7. The Scandinavian country was commended for its well-funded pension system where pension assets account for 169pc of GDP.
The Netherlands and Australia rounded out the top three, scoring 80.5 and 79.6 points respectively.
India was found to be the worst country on the index, with less than half of Denmark's score (40.3, down from 43.5 last year), because of its lack of a minimum level of support for poor retirees, its failure to impose a minimum age for access to pension benefits and its poor regulation of private pensions.
"Developing and implementing the right reform to improve pension systems and provide financial security in retirement has never been more critical for both individuals and societies," said Dr David Knox, senior partner at Mercer and author of the report.
"In coming years, age-related spending around the world, primarily driven by increased pension and healthcare costs, will potentially outstrip the costs of the Global Financial Crisis, the most significant financial crisis in 100 years."
Dr Knox said the report could help governments protect citizens against the possibility of outliving their savings, a risk of having so-called ageing populations with declining birth rates and longer life expectancies.
These are the best places in the world to retire
- Denmark (81.7)
- Netherlands (80.5)
- Australia (79.6)
- Sweden (74.2)
- Switzerland (74.2)
- Finland (73)
- Canada (70)
- Chile (69.1)
- United Kingdom (65)
- Singapore (64.7)
- Ireland (63.1)
- Germany (62)
- France (57.4)
- United States of America (56.3)
- Poland (56.2)
- South Africa (53.4)
- Brazil (53.2)
- Austria (52.2)
- Mexico (52.1)
- Italy (50.9)
- Indonesia (48.2)
- China (48)
- Japan (44.1)
- South Korea (43.8)
- India (40.3)
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