Contents
How corporate pensions work and how much you need to put aside in a pension account – we understand modern pension insurance tools
About the expert: Alexander Prokopenkov, Development Director of NPF Sberbank.
Less than half of our countries of working age believe that a state pension will be enough for them to live comfortably in old age. Hence the need for their own savings, which can be done either independently or in partnership with the employer. At the same time, the management of pension capital seems to many to be a difficult task associated with bureaucracy and constant contacts with the fund.
Actually it is not. Retirement products have been online for a long time, and the pandemic will only accelerate the digitalization process. Unless, of course, changes are adopted at the legislative level that will allow the full development of this direction.
The pension industry is divided into three segments:
Today, only one of these segments – individual plans – fully exists online. Draw up an agreement, make payments, monitor the status of your savings, draw up applications and payments – all this has been possible to do for several years without leaving your home. Thanks to this, such products worked even during the self-isolation regime. Over the first couple of weeks of quarantine, interest in self-savings for retirement, judging by the traffic on the Sberbank NPF website, has grown 3,5 times. Interest did not fade after the lifting of the self-isolation regime: now almost half of new contracts are executed through remote channels, and sales through the Sberbank mobile application online in June increased eight times compared to March 2020.
How to save for retirement
If a 35-year-old man wants to receive in addition to the state pension 30 thousand rubles per month, he needs to save monthly for PPI RUB 3 with an investment yield of 7% per annum.
Women retire earlier, so their savings period is five years shorter. Therefore, a woman of 35 years old to receive an additional pension in 30 thousand rubles per month need to be postponed RUB 7, and to get 50 thousand rubles – already 11 rubles. monthly.
Clients with STIs can apply for non-state pension payments at age 55 (women) or 60 years (men).
The calculations show the average annual return on pension reserves of NPF Sberbank over the past ten years (distributed to accounts). The results of investing in the past do not determine future returns.
Control Restriction
The compulsory pension insurance segment could also be transferred online, but so far this process is limited by legal requirements.
The method of online transfers of pension savings was developed back in 2018. It was assumed that savings could be transferred through the “Gosuslugi”. In the same place, the client could choose a pension fund, find out all the features of the transfer and consciously decide who to entrust with managing their pension savings.
Since 2019, this scheme has been implemented, but with one essential condition – in order to submit an application through the Gosuslug portal, the client must have a qualified digital signature. It was this remaining limitation that did not allow the service to be mass-produced. As a result, now almost no one uses transfers of mandatory pension savings – the entire market accounts for 20-30 thousand applications for the transfer of savings, although earlier there were tens of millions of them a year.
This practice needs to be changed. The transition of the OPS to online could solve the problem of transparency in the transfer of pension savings, which is now of concern to many – any movement of funds in the digital system would be immediately tracked, which would exclude the possibility of falsification or transfer of savings without the knowledge of the client.
Another way to save for retirement that few people know about is corporate pension plans. According to a survey conducted by NPF Sberbank together with the job search and recruitment service Rabota.ru in February this year, 78% of our countries would like to receive a pension from the employer, but only 32% of citizens know that such programs exist in some companies, and only 10% have this option included in the social package.
Now many employers, especially from the sphere of small and medium-sized businesses, have little idea of the possibilities of corporate pension programs. Digital tools can help make corporate pensions more mainstream and satisfy the demand of the 78% of working people in our country who dream of employer pension benefits.
Nevertheless, this segment of the market is considered old-school, and even 5 years ago they generally tried to ignore it. But now PPC sales are not lagging behind sales of individual pension plans. When it becomes possible not only to tell, but to sell programs online, promotion will move to a completely different level. A client connected to the service will be able to thoroughly understand the program, calculate their tax and other benefits, submit documents and connect a checkpoint in their company in a few clicks.
How does a corporate pension work?
Suppose a 35-year-old woman joins a corporate pension program, whose income is 100 thousand rubles. per month. She will monthly deduct at the checkpoint 3% of your salary, the employer will add the same amount. Assume wage indexation of 3% per year. The investment return on the program will be 7% pa. As a result, from the age of 60, a woman will receive a monthly lifelong corporate pension in the amount of RUB 34
A man with the same savings parameters will receive a large lifetime pension – from 65 years to RUB 75 per month, — because the accumulation period for men is longer and life expectancy is shorter than for women.
An employer can set special conditions for an employee to participate in a PPC – for example, the program will be available only after working a certain period in the company or successfully completing a project. If a person leaves the company before retirement, his own savings and investment income (or part of it) remain with him, but the employer’s contributions in this case may be canceled or paid at least partially – it depends on the employer’s pension policy.
Participants of the CPT can apply for non-state pension payments at the age of 55 (women) or 60 years (men).
The calculations show the average annual return on pension reserves of NPF Sberbank over the past ten years (distributed to accounts). The results of investing in the past do not determine future returns.
Now many large financial and technology companies are creating entire ecosystems of services for legal entities. Accounting services, electronic cash desks, investments, tax consultations, insurance – a lot of services on one site, where a business can immediately receive many useful services. Checkpoints fit perfectly into such ecosystems, which should become as familiar and an integral part of the social package as VHI.
At the first stages, we are talking about boxed product solutions that take into account the needs of small and medium-sized businesses. For large businesses, an individual approach in choosing the parameters and conditions of corporate programs will still be in demand, so in the near future the format of face-to-face discussion and selection of a program for a particular company will remain. However, in the near future we are going to launch digital design programs for large companies, within which our future partner will be able to independently choose the conditions he needs.
The importance of corporate pension programs especially increases in times of economic instability. They can become an integral part of the social package that companies offer their employees. This is due to the fact that the checkpoint is a very flexible and multifunctional tool that can be customized to suit the most diverse needs of corporate clients. For example, if during a crisis the employer does not have the opportunity to index the wages of employees, the inclusion of a corporate pension program in the social package will help reduce negative moods in the team. At the same time, due to the special tax regime, the company’s costs for the pension program are significantly lower than for salary increases.
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