Working Russians will not be able to dispose of their savings until 2025
The funded part of the pension, which has long become a proverb, is frozen again. The corresponding decree was signed by Vladimir Putin, postponing the unblocking of this instrument until 2025. Russians who have not reached the retirement age will continue to donate 6% of their salaries to the insurance part of the pension system, although they will not be able to independently manage the directed tranches. The state is going to use these funds to fight the coronavirus, denying citizens the right to find a much more effective use of the earned funds, including in the form of investments in profitable instruments that allow them to ensure a prosperous life after going on a legal holiday, when the current pandemic will go into historical retrospect. …
Svetlana Bessarab, a member of the State Duma Committee on Labor, Social Policy and Veterans Affairs, explained the prolongation of the “freeze” of the funded part of the pension. “The frozen part is no longer reanimated. It is impossible, according to the same procedure, to work off the funded part of the pension that has been frozen for eight years. This is a rather complicated process, so we are forced to save transfers from the federal budget, since 772 billion rubles (estimated costs for the fight against coronavirus – “MK”) remain in the joint part and are transferred to the personal accounts of the insured, “the deputy said.
It is worth recalling that the funded system was introduced in Russia in 2001. The initial conditions guaranteed that 6% of the wages fund would be transferred to the current account of every worker born not earlier than 1967 to the state pension departments. This situation allowed citizens to accumulate a certain amount of money by old age and fully justified the system.
Everything turned upside down in 2014, when contributions to the funded part were “frozen”. The majority of potential retirees immediately had a natural question: how can you save something if new contributions are not being received? Young workers who entered the labor market after 2018 have completely lost the ability to distribute their income among various financial instruments that promise to bring more profits in the future than government subsidies. Many of those who previously saved money have given up their savings. The exception was money from non-state pension funds earned in the form of investment income.
Of course, there were many disadvantages to this approach. Now the average pension in our country is 17.5 thousand rubles. To receive this amount in the usual solidary compulsory insurance system, the monthly salary must exceed 200 thousand rubles. Only then 6% of deductions will allow the future pensioner to reach the declared parameters and form the required amount. However, in Russia, not everyone can boast of such a monthly income.
According to Sergei Smirnov, Doctor of Economics, it cannot be said that the funded part of the pension “evaporated” from the accounts of depositors. “This money continues to remain in the Pension Fund and can be paid to anyone who wishes, subject to certain characteristics, first of all, after reaching the retirement age. The accumulated funds can be received in the form of a monthly surcharge or withdrawn at a time, ”explains the expert.
However, as the chief analyst of TeleTrade, Mark Goikhman, believes, it would be much more profitable for the working-age population not to freeze, but to completely abolish the existing funded pension system. “From the point of view of Russians preparing for a well-deserved rest, such a decision would be fair and would be an excellent help for increasing the financial literacy of the population. In this case, each person would be able to independently determine which financial institutions and instruments will be the most profitable for deductions for future old age, ”the expert believes.
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