First swallow empty and take a deep breath! Most people had to do that in recent years when the new insurance certificate for occupational pensions (BVG) ended up in the mailbox. Because the trend was mainly pointing in one direction – down.
While the conversion rate for the so-called enveloping funds, which mix mandatory and extra-mandatory, averaged 6.74 percent in 2010, it fell to just 5.52 percent by 2021. This means that for every CHF 100,000 saved in retirement savings, there is a pension of around CHF 5,500 per year. By 2025, the average rate is expected to drop to 5.3 percent. This is shown by the latest Swisscanto pension fund study.
Interest was also skimped on. In the last ten years, retirement assets have still earned interest at an average of 2.1 percent, and in the last two decades it has been around 2.6 percent. And that despite the fact that the performance of the cash registers was sometimes significantly higher.
200 francs less – per month
With massive consequences for pensions: if a newly retired person received CHF 2,372 a month in 2015, according to federal pension fund statistics, it was only CHF 2,156 five years later.
Stossend: While the new pensioners are starving, the pension funds are doing better than they have for a long time. In recent years, their balance sheet total has increased massively. At the end of 2020 they had CHF 1063 billion on the high edge. Last year, the cash registers posted such brilliant returns that the balance sheet should have increased to 1100 to 1200 billion francs.
The only question is when the insured and pensioners will benefit from the manna. After all, last year the average interest rate on retirement assets was around 3.5 percent. And the UBS pension fund increases the pensions for individual new pensioners – an isolated case that could have a signal effect.
Toxic mixture for pensioners
“A trend reversal is needed across the board,” says union boss and SP national councilor Pierre-Yves Maillard (54) to Blick. Especially because rising inflation – in April it was 2.5 percent – makes for a toxic mixture. “In the last ten years, the interest on old-age savings in the second pillar has been historically low, the conversion rates have been drastically reduced, and now rising inflation is eating up the value of the pension fund pensions, which are already too low,” railed Maillard. “There is a risk of a loser generation!”
Maillard counts the 55 to 70-year-olds among these. “They receive a much lower pension than they expected when they started working,” he complains. “The pension loss here is a good 20 percent.” The reduction measures of the pension funds would have led to shaky pensions and social insecurity. “Now, in view of the turnaround in interest rates, it is becoming clear that this reduction in performance was not justified.”
Especially because the redistribution from the active to the pensioners has been largely eliminated. While younger people would now benefit from the interest rate turnaround and high pension fund reserves, targeted measures are also needed for the “loser generation”.
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“Stop performance degradation immediately”
“The reduction in performance must be stopped immediately,” demands Maillard. And reductions in conversion rates and technical interest rates decided in advance would have to be reversed. “The pension funds have enough money on hand so that the pensions of this transitional generation can also be increased,” the union boss makes clear.
“Furthermore, a legal solution is needed to compensate for inflation,” says Maillard. Because: “If this is not corrected quickly, the pensions will lose value – and the pensioners will have to tighten their belts even more.”
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