January 2022
11Jan

US. These humble Pa. county pension plans beat PSERS’ returns by keeping it simple

Money management, according to billionaire hedge-fund managers and other high-paid practitioners, is a complex science and art. But does it really have to be? Big state pension funds in states like Pennsylvania or California spend many hundreds of millions of dollars a year hiring many sophisticated advisers to bet on arcane strategies -- multiple classes of hedge funds and private equity, real estate and debt funds -- in hopes of boosting long-term profit and protecting from market downturns. Over time,...

January 11, 2022
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11Jan

Estonia. State to provide option of increasing second pension pillar deposits

The Ministry of Finance has drawn up an intention to allow people to voluntarily increase their second pension pillar deposits to 4 percent or 6 percent from the current 2 percent. The draft is currently on a coordination round. Since the creation of the mandatory funded pension system, the rate of payment for the second pillar has always been 2 percent of a working person's gross salary, but the finance ministry is planning amendments to the Funded Pensions Act, which...

January 11, 2022
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11Jan

Germany’s Aging Population Means 5 Million Fewer Workers

Germany’s population is aging and the impact is starting to get real, according to Holger Schaefer, senior economist with the IW economic institute in Cologne. In 2022, the workforce is set to shrink by more than 300,000 people as more reach retirement age than start working, and it will get worse in the coming years, he said on Twitter. By the end of the decade, there could be more than 5 million fewer workers, unless immigration can plug the gap. Read more...

January 11, 2022
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10Jan

US. The clock is ticking on retirement security bills, industry experts say

Lawmakers on both sides of the aisle are motivated to pass another major retirement security package in 2022, but with midterm elections looming in November, time is of the essence, retirement industry sources said. Bipartisan bills were introduced in the House and Senate in 2021 that build on the Setting Every Community Up for Retirement Enhancement Act, known as the SECURE Act, which Congress passed and was signed into law in late 2019. Sens. Rob Portman, R-Ohio, and Ben Cardin, D-Md.,...

January 10, 2022
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10Jan

UK. Pensions largest component of household wealth – ONS

Pensions make up more than any other component of total net household wealth at 42 per cent, although inequalities remain within pension provisions, data from the Office for National Statistics (ONS) has revealed. The ONS noted that the proportion of pension wealth has increased over the past 14 years, likely due to the introduction of auto-enrolment, increases to state pension age, and varying defined benefit (DB) pension pot valuations. Retired households were found to be wealthier than those of working age,...

January 10, 2022
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10Jan

Malaysia. Tweak pension fund to benefit low- income workers

In our published paper nearly a decade ago, we wrote that “... scant attention is given to the plight of low-income workers in a situation of rising inequality caused by widening pay-gaps or differences in actual wages”, and “low average savings balances raise the question of retirement adequacy at desired income replacement rates” (Hamid and Chai, 2013). We stated that, “Since either expanding the accumulation phase or setting a minimum sum balance would result in unpopular delayed pay-outs, other solutions must...

January 10, 2022
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07Jan

US. Pandemic’s impact on retirement savings varies by geography, gender and age

Nearly every American has felt the impact of the pandemic on the ability to save for retirement. “Retirement is expensive, and Americans were struggling to save enough money for it long before the pandemic,” according to a report from The Penny Hoarder on its recent survey. “The economic turmoil of the pandemic underscored some critical lessons about investing for the long term, including keeping calm during turbulent markets and using market slumps as an opportunity to invest when prices are...

January 7, 2022
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07Jan

UK. Expanding auto-enrolment could cost employers more, experts warn

Proposed legislation expanding auto-enrolment pensions to include thousands more employees, including younger workers and lower earners, could lead to higher costs for employers, experts have warned. A bill was introduced to Parliament yesterday (5 January) that would see the minimum age for auto-enrolment drop from 22 to 18, giving employees an extra four years of savings towards their pensions. The proposal would also scrap the £10,000 minimum earning threshold that currently triggers automatic enrolment, meaning that all workers over 18 would...

January 7, 2022
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07Jan

India’s jobs crisis is more serious than it seems

Jitendra Maurya was one of more than 10,000 jobless young people who turned up for interviews for 15 low-skilled government jobs in the central state of Madhya Pradesh. Many of them were overqualified - aspirants, according to one report, included post-graduates, engineers, MBAs and people like Maurya, who is preparing for a judge's exam, according to a BBC report. "The situation is such that sometimes there is no money to buy books. So I thought I will get some work [here],"...

January 7, 2022
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07Jan

UK. FTSE 350 DB pension deficit falls by £28bn; ‘looming risks’ ahead

The aggregate accounting deficit of FTSE 350 companies’ defined benefit (DB) pension schemes fell by £28bn during December, ending the year at £76bn, according to Mercer's latest Pensions Risk Survey. It revealed that liability values fell from from £962bn to £913bn during the month, although asset values also declined, from £858bn to £837bn. However, whilst the deficit had fallen compared to November, it had increased year-on-year, with an aggregate deficit of £70bn recorded at the end of 2020 and of £41bn...

January 7, 2022
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