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15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
15 johan sjostrom
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15 johan sjostrom

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  • State pension Based on income (income ceiling app. 36 000 Euro yearly, above which there is no pension entitlement) 18.5% on ones’ income is set aside for the future state pension; Income pension (16 percentage points) Premium pension (2.5 percentage points, individual choice of funds) Guaranteed pension (minimum level) Occupational savings Supplement to state pension Nation-wide collectively negotiated agreements (employers’ organisations and trade unions) 90%of the employees in Sweden are covered by such an agreement Paid by employer Viewed as a postponed salary Individual choice Common to KFS, PFA- agreements; employees make decisions over part of their pension plan themselves. Employees choose the insurance company where the pension funds are to be placed, and the type of fund. Private saving traditional pension insurance, investment fund insurance (unit-link), direct investment fund saving tax relief
  • Transcript

    • 1. Johan Sjostrom Marketing Director, KPA PENSION (SWEDEN) Friday, 27.9.2013
    • 2. First and Second Pillar Pensions in Sweden Conference on Pensions, September 2013, Hydra Ev datum
    • 3. State pension (I pillar): • Based on income • 18.5% on ones’ income is set aside • Income pension (16 percentage points) •Pay-as-you-go, notional defined contribution • Premium pension (2.5 percentage points), individual choice of funds • Guaranteed pension (minimum level) • 46 430 EUR (2013) is the ceiling for accruing pensions rights Occupational pension (II pillar): • Nation-wide collectively negotiated agreements •Covering appr. 90 % of the workforce • Paid by employer, DC, individual choice The Swedish pension system
    • 4. 1994 Parliament adopts principles of the new pension plan 1991 Commission set up 1992 Draft of a new pension plan 1998 Main legislation of the new pension plan 2001 Legislation on the automatic balance mechanism But transition quick i international comparison 2003 first payments according to new system Social democratic government Center-right government Pension reform process - very long 1990 1991 1994 1998 2001 2003 Social democratic government
    • 5. Civil servants Local & regional govern. empl. Private white color Private blue color Swedish “pension market”, payments ATP “old” old-age pensionplan Inkomstpension (new) Premium pension (new) 6.2 1.0 Guaranteed pen. 1.0 0.6Survivors pen. 7.8 1.0 1.6 9.3 10.3 1.5 75% 15% 10% Occupa- tional Public Private Percent of GDP“Market share” 0.0
    • 6. Second pillar - four main collective agreements White collar 750 000 Blue collar 1 200 000 Private sector employees Public sector employees State 215 000 Municipals and Regions 1 100 000
    • 7. Second pillar pensions – contributions/repl.rates Collective agreement DC (contributions and income ceilings) DB Private sector, Blue collar 4,5 % < 46 430 EUR 30 % > 46 430 EUR Private sector, White collar 4,5 % < 46 430 EUR 30 % > 46 430 EUR < 1979 (DB) > 46 430 EUR State sector 4,5% < 105 710 EUR Appr. 60 % replacement > 46 430 EUR Municipals and regions 4,5% < 46 430 EUR 30% > 46 430 EUR < 1985 DB > 46 430 EUR
    • 8. Swedish market – second pillar pensions
    • 9. Market volumes, life insurance
    • 10. Where can Mr Svensson invest his second pillar pension? Traditionell Försäkring KAP-KL* SAF-LO PA-03* ITP FondförsäkringIcke-valsbolag KAP KTP
    • 11. What’s the status of my pension?
    • 12. The orange envelope • Started in 1999 • Distributed each year to citizens born in 1938 and later – Pensionable income > 1 843 EUR • Distribution: – January to March • 6,2 Million envelopes each year (population 9,3 Million)
    • 13. Projections made in the orange envelope Age of retirement 0 % growth 61 year 65 year 70 year
    • 14. Does Mr Svensson read his orange envelope?
    • 15. Does Mr Svensson understand the orange envelope?
    • 16. www.minpension.se • Implemented in 2004 • 1,8 million users (2012) • A joint initiative by the State and the Insurance Industry • I, II and III pillar pensions • A tool for individual forecasts
    • 17. Pension forecasts from different sources Orange envelope Yearly statement & projections I pillar Green envelope Yearly statement & projections II pillar My pension www.minpension.se Forecasts on-demand I, II and III pillar
    • 18. Initiatives in the near future • Increasing minimum pension age – Currently at 61 year in first pillar – Currently at 55 year (DC) and 61 year (DB) in second pillar • Premium Pension in first pillar? – Funded or not funded? – Number of funds? • Tax incentives for third pillar pensions? – To be or not to be? • Financial literacy – How can Mr Svensson be more financial literate?
    • 19. Thank you for your attention! johan.sjostrom@kpa.se www.kpa.se

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