“Today, we will probably discuss the proposals of the Ministry of Social Security and Labour. My message is very simple – today’s pensioners and future pensioners cannot rely on the state pension system alone. No one can survive with dignity on 30%. current income, you need to think about various forms of savings”, A. Armonaitė told reporters on Tuesday.
“Someone might have invested in real estate and saved up, someone might have put a deposit in a bank, saved in investment funds, but that’s what you need to do. I hope that we will not only talk about SADM’s proposals regarding the interpretation of the Constitutional Court, but also more broadly, how to ensure a dignified old age. This is also relevant for people of my generation, because we need clarity on what the pension system and savings will look like,” she noted.
On Tuesday, at the meeting of the Tripartite Council, SADM will present proposals on how to improve the second tier of pension accumulation. Among these offers is the possibility to have more time to decide on the start of accumulation, the refusal to pay contributions.
We also want to increase the exceptional opportunities to withdraw the accumulated money before retirement. This could be done in the case of severe, progressive disease with severe disability.
It is proposed to create more opportunities to temporarily stop hoarding. Instead of the currently applicable 12 month period that can be divided, during the entire accumulation period, a person could temporarily stop accumulation within 24 months. every 10 years.
In addition, it is desired to set a longer period to decide on accumulation, allowing to do so later if you miss the opportunity to refuse to accumulate in advance.
The aim is to reduce the accumulation of offers for those who do not want to do so. As the report explains, currently all people under the age of 40 are offered to save every 3 years. It is suggested that, in general, such reminders should be given to a person only 2 times in total.
Finally, one wants to predict whether to choose a lump sum or a periodic payment at retirement age. Now, everyone who has accumulated more than 5,403 euros can only receive a periodic payment.
Although the SADM proposes that it is easier to withdraw from the second-stage pension accumulation due to serious illness and other important reasons, Vaidas Augustinavičius, advisor to the president on economic issues, says that the changes are positive, but still not attractive enough for the population.
The Lithuanian Free Market Institute (LLRI) says that given the human nature that tends to prioritize quick gratification today, the automatic inclusion in pension accumulation in second-tier pension funds and the accumulation model itself, maintaining accumulated funds until retirement age, introduces certain contractual limits and responsibilities to the resident’s free disposal of his income.
According to LLRI, in order to smoothly implement the CT Resolution, it is important to ensure that the implementation of changes does not create unmeasured expectations, is concrete and indisputable.
The data show that 766 thousand are actively accumulating in Lithuania. people, and currently the taxes paid on assets managed by second-tier pension funds are among the lowest among OECD countries.
8.2 billion have already been accumulated in the second-tier pension funds. euros, of which 2.4 billion or almost 30 percent is the return on investment, ie the amount earned.
SADM claims that the state also contributes to those accumulating in Tier II pension funds. Every month, the state adds more than 27 euros to what the employee pays. According to the institution, when calculating the state’s contribution and investment return, a person saving currently has on average even 3 times more than he transferred from his salary.
2024-08-21 10:40:28