On October 18, the question “Are you worried about discounts on your pension?” appeared on Thailandblog. and there were a great number of affirmative responses to it. Unfortunately, hardly any reasons were given why the reader should be concerned and that is why I give a more detailed explanation of what is going on in this contribution.
For the record, I would like to inform you that I am certainly not a pension expert and, prior to my analysis, I would therefore like to tell you that my analysis is completely incompetent, incomplete, oversimplified and, moreover, steeped in conspiracy thinking. That is why I appreciate any response to this discussion, but I do ask that you substantiate your responses so that everyone can learn something from them.
The scandalous way in which the (policy) funding ratio of pension funds (PFs) is calculated
In my contribution to the question of October 18, I explained how coverage ratios (assets/pension liabilities * 100%) are calculated at PFs. You can read it again here:www.thailandblog.nl/expats-en-pensionado/pensioen/kortingen-pensioen/ . As of 2015, PFs use the term “policy funding ratio”, which is the average funding ratio over 12 months.
My contribution stated that the pension obligations are systematically set too high because the government prescribes a low actuarial interest rate and the earning capacity of assets is completely disregarded. On the website www.pensioners.nl you will find the “analysis tool 2014” under publications and from this you can calculate that approximately 80 PFs used an average actuarial interest rate of 1.89%, while in that same year the return on the investment portfolio was 15.4%.
Perhaps you are now saying that 2014 was not an average year and that is why I give you the average, weighted investment result over 1971-2014 of the PF Zorg en Welzijn being 8.7% and of the ABP over the period 1993-2014 being 7.5%. Perhaps you do not believe me and therefore the link to the letter from the KNVG of September 9 to Mrs Klijnsma with these data. Incidentally, the letter is about the recovery of the indexation perspective: www.pensioners.nl/
While the low actuarial interest rate has pushed up pension liabilities to an unprecedented level, the earning capacity of the assets is completely disregarded. It can't get crazier, can it?
Pensioners are now giving up for the pension accrual of young people
Yes, it can get even crazier! Have you not read everywhere that the young people supposedly pay for the elderly and that the pension pots are empty when the young people retire? The first is a fable and just the opposite is true. The second is only partly true, but that is because of the current government, our slavish, stupid parliament and the lack of organization of the current employees. More on that later!
Are you familiar with the term “cushioned cost-covering premium”? This is a pension premium that is lower than the cost-covering premium that employees and employers pay for a pension obligation arising in any year. With a cost-covering contribution, so much is paid in that the pension obligation that has arisen is covered and the equity capital is maintained. With a cushioned cost-covering premium, the premium to be paid is reduced by boosting the expected investment results – by means of a higher market interest rate. The actuarial interest rate used to calculate the pension obligations is therefore not used, but a higher market interest rate. So less is added to the assets than by which the pension obligations increase, thereby eating into the assets and funding ratio of pension funds.
In fact, there is a premium discount on the pension premiums to be paid by employees and donors, which means that in the future, discounts on pension obligations of pensioners and workers will be necessary to compensate for the lost capital. With this, the elderly (retired) pay the discount for the Young (working people and their bosses). Over the period 2010-2015, the discount amounted to a total of 28% or, expressed in monetary terms, almost €40 billion or approximately 3% funding ratio points. And do you know who gives the highest discount measured in money? Our own government with its ABP pension fund for civil servants with a discount of € 881 million. Would you like to read more about the cushioned cost-effective contribution? Then look here: www.gepensionerden.nl/Brief_CSO-KNVG
Pensioners' associations do raise this injustice with the Secretary of State and the House of Representatives, but the government's interest in levying more taxes through lower deductible pension contributions and the importance of higher profits in the business community means that you, as a pensioner, foot the bill .
New pension legislation and who are your friends?
At the end of 2014, new legislation was adopted by parliament that became applicable in 2015 and is referred to as “New financial assessment framework”. There are a lot of new rules in it, but I'm cherry picking by highlighting a few. For the calculation of the pension obligations, the PFs must use the so-called UFR (Ultimate Forward Rate) for obligations longer than 20 years. This was initially 4.2% and was lowered in July by the Dutch Bank for PFs to 3.3%. However, insurers may continue to use the higher UFR and therefore need to maintain fewer reserves than PFs. I estimate the effect of the UFR on the funding ratio of PFs to be minor because liabilities that weigh more heavily closer to the moment of valuation and the much lower interest rate continues to apply to them.
Another measure is that in the event of a funding shortfall (funding ratio less than 105%), cuts must be made less quickly. The acceptable underfunding period has gone from three to five years and the discounts must now be spread over ten years and must be reassessed every year. Furthermore, the Mandatory Equity (VEV) has been increased by approximately 5% and is now between 128% and 135%. The exact VEV depends on the composition of the assets in a PF. If the policy funding ratio is lower than the VEV, a PF may only partially index. The lower limit for indexation has been raised from 105% to 110% and per percentage point policy funding ratio above 110%, a PF may only use 0.1% for indexation. So suppose a PF has a policy funding ratio of 120% and the general wage increase is 2%, then the PF is allowed to index (120%-110%)*0.1 = 1%.
I assume that the State Secretary Ms Klijnsma sent the law to parliament with an explanation, but I take the liberty of doing it again for her and then taking reality into account:
Dear members of the Senate and House of Representatives. Considering the government's plan to increase the profitability of the private sector as well as to increase the government's tax revenues and taking into account the fact that the elderly (65+) in the Netherlands are among the most prosperous compatriots (see report SCB 2012, among others) ) I am sending you the New Financial Assessment Framework Act. In this law, PFs will no longer be able to make short cuts in the event of funding shortfalls and, moreover, those cuts will be spread over 10 years.
The government considers it important that PFs build up an unprecedented buffer of approximately 30% on the pension liabilities and to this end the possibility to index pensions of those PFs that have a reserve deficit (funding ratio lower than VEV) is being severely restricted. We, as the government, will also continue to promote the policy of cushioned cost-covering premiums so that tax revenues remain at a maximum and the policy funding ratios remain correspondingly low. Because in 2014 95% of pensioners were with pension funds with a too low VEV, I can assure you that the indexation limitation covers almost all pensioners.
Given the fact that the Dutch economy, like Japan, has reached a more or less steady state, nominal incomes from pensions will therefore remain virtually the same for at least another 10 to 20 years, but they can continue to enjoy a stable AOW. This, of course, on the assumption that we will not tax the AOW. The government does not expect major problems from society because the approach is similar to boiling frogs (do not throw them in the pan when the water is boiling, but heat the cold water when the frogs are already in it) and the elderly have little opportunity to resist . We also have a special circular archive for letters from the elderly and pensioners' interests. Finally, I would like to point out that the current bill is fully in line with the policy to put older people at a disadvantage compared to working people.”
Which of the political parties voted for and which against in the House of Representatives? Voters in favor were VVD, PvdA, D66, Groen Links, SGP and Christenunie. Those who voted against were 50plus, SP, CDA, PVV and the Party for the Animals. Personally, I think the PvdA's vote in favor is yet another exposure for this party. Do you now understand my characterization of a servile, stupid parliament that agrees to measures that hit a large, vulnerable, undefensible group of people so disproportionately hard?
If you want to read the voting behavior yourself, go to: www.loonvoorlater.nl/nieuwsbriefs/stemwijzer-verkiezingen-18-maart-2015.aspx
Young people later receive a much lower pension
When I was 23th started working I had to wait another two years before I could participate in the pension fund and the accrual for my pension was done from the age of 25th until my 65th. So the accrual was for 40 years with the ultimate goal of an AOW + supplementary pension amounting to 70% of the most recently earned salary. The last-earned wage principle was later replaced by the lower average wage principle. Paying pension contributions reduces tax revenue at the marginal rate (box 1) and, moreover, the accrued pension capital is also not taxed in box 3. And when you retire, settlement is often made at a much lower income tax rate. A thorn in the side of the government and in 2013 the legislator drastically reduced the percentage that can be set aside tax-free for pension. The rationale for this was that everyone should work longer and thus save for retirement over a longer period of time, but the real consideration is to increase taxation and increase corporate profits.
PFs have adjusted their rules accordingly and my pension fund now allows people to accrue pension from the age of 18 to 67. Young people who follow an HBO or university education and perhaps also want to travel the world for a year or so can never again build up a full pension through participation in a pension fund and start with a backlog of five to ten years. Add to this the fact that the level of organization of employees in general and that of young people in particular is now so low that it is increasingly difficult for trade unions to fulfill their role of representing the interests of (younger) employees. Young people can either save for their own retirement or buy banking and/or insurance products alone, but the past with the usury policy affairs and the banking crisis of 2008 is hardly encouraging. If you are more optimistic than I am, may I recommend the book “This cannot be true” by Joris Luyendijk or even better to watch the documentary “Inside job” from 2010?
What does it mean for you concretely?
For my calculation I assume a pension with the ABP of € 1000 per month and this is also consumed monthly. Furthermore, I assume an initial situation of a policy funding ratio of 99.7% at the end of 2015 and a growth to 128% in 2027. The ABP indeed had a policy funding ratio of 2015% at the end of September 99.7 and has indicated such a growth to 128% at the end of 2027. Fortunately, there is no need to cut because people do not fall below the limit of 104.2% for five consecutive years. Indexation may only be applied above 110% - in the following year - and that will be for the first time in 2021 and then your income will rise to € 1001.49. At the end of 2027, your income will have risen to € 1061.45 due to indexations, but your consumption package will have risen to € 1268,24 in the meantime, so that you will have lost purchasing power of almost 20%.
Due to current government policy, little has come of that promised value-added (non-prosperity-linked) pension, and hadn't taxes for people aged 2015 and over already been increased in 65? It is really hoped that parliament will come to its senses and will also stand up for the interests of pensioners. See the calculation below:
Further orientation resources
If you would like to orient yourself further, please also visit the following websites: www.pensioenleugen.nl, www.pensioners.nl, www.uniekbo.nl, www.pcob.nl en www.anbo.nl and know who stands up for you in parliament for your interests.
Rembrandt van Duijvenbode
I wonder why it is not possible to draw attention to this theme in a talk or discussion program on Dutch TV. BV “broadcaster MAX”. There are usually middle-aged people sitting at the table there.
It will no doubt be interesting to hear the reactions of the people who will soon be confronted with it, or perhaps already affected by it….
Hopefully, the loss of income will not go so far that pensioners will no longer be able to spend the winter outside the EU. If that does happen, they are certainly slaves of the (R) government.
Great article from an expert. In terms of purchasing power, my state pension has declined every year since 2007 because the amount paid out remains the same. Where there is an annual indexation, new levies and rules are applied at the same time, which nullifies the indexation. In addition, the
government with measures that put a heavier burden on pensioners because “they no longer participate in the labor process”. A favorite expression of one Pechtold/D66 who believes that pensioners belong to the group that should be punished for loitering and taking benefits. The time will come when all elderly people who only receive state pension will automatically receive food stamps for food banks because the amount paid out after deduction of fixed costs leaves no room for food purchases. Thanks to the PvdA and D66.
what a wonderful play and I don't think a word of it is a lie. Life is a theater play and the best players can be found in politics. When will the majority of Dutch people wake up and I wonder whether pieces will be submitted again showing that there is no other way because the Dutch are getting old and it is no longer affordable, so it is right that the elderly will pay for the costs. is only a remedy and that is resistance within the legal possibilities of course because violence solves nothing. Early elections, yes, and then no longer allowing the many free days of the party and the party for the poor to rule. Not even D66, because it wants to increase the retirement age even more. Is there more money to spend on the wrong things? We've been on the bench for a while and it's time to get up. Society has become a self-society and must be much more social. The polder model, the pension system, the flood defense - these were gems of our society and what happens to them. You have just read the story of the demise of our pension system. Dutch people sleep well and wake up healthy tomorrow /
Clear explanation Rembrandt.
The leading political parties are failing the current pensioners.
Dmv. all sorts of intricacies create a smoke screen, which is hard to follow for an ordinary person, except that the disastrous policy is slowly but surely becoming more and more visible in the disastrous loss of purchasing power.
We had usury policies, name the beast… usury pensions.
Good luck everyone.
Nico B
I think everyone is being let down: the now retired, those who hope or hoped to retire soon and the young. I just assume that I can work until 70+ for next to nothing on AOW and pension. And what can you do about it? Little, I read the letters from my pension fund for information -where you already know in advance that it is bad news-, that's all you can do with it anyway. Only build up a potty yourself, but that is not easy if you have a generous income. So I count on it being almost pure misery when I'm an old man, then it can only be better than expected. And let's see if we would grow old, so seize the day.
Dear Rob,
You are right when you say that everyone is being let down. That is also part of the policy, divide and conquer. If you pit the young against the old and make the prospect less and less attractive, you will also persuade people not to participate in pension schemes. Especially the young people, more and more of whom cannot see beyond their noses. The pension system is still future-proof with some adjustments and much more effort needs to be made to achieve this. Waiting for what is to come is a bad approach, because then decisions are made for and about you. Then you can only nod yes and amen. In my working life I have taken a civil servant dispute to court three times and won all cases. The last case even took 7 years to reach the CRVB. Belief in the good and perseverance are the right ingredients. There are also consultation days at pension funds and opinions can be shared. If you keep your mouth shut, you have no right to have a say. Making the right political choices is also still possible, although our democratic system needs to be overhauled.
At my work we already said to each other about 20-25 years ago: the government is unreliable, take care of yourself !!! Make sure you have your own house that is paid off when you are 65, and make sure you have a self-managed capital so that you have at least 500 euros extra per month in due course. Preferably (still) a 2nd house that you can rent out (ok, that's not for everyone).
Not that the politicians are bad, on the contrary, most politicians are idealists (people who say that ministers etc. are pickpockets, to which I say, that is not true and if the value is, he trusts his guests), but 'they' have too spent a lot of money, promised and given too many lollipops to the people. All this for voter gain. This is a great disadvantage of democracy…
Margaret Thatcher said it so eloquently: “The problem with socialism is that you eventually run out of other people's money.”
Peak wealth for everyone is now behind us.
Yes, indeed, purchasing power for retirees will definitely fall further.
May we, here in Thailand, not count ourselves lucky that major money worries pass us by?
We have no street tax, polder levy, waste levy, real estate tax, etc., etc., and our gas bill is also practically nil. Most of us don't pay rent or mortgage here either. So you can safely assume that you start monthly with approximately € 1.000.= advantage compared to pensioners who live in the Netherlands. I recently checked this with an acquaintance in the Netherlands who has aow and a very small pension. She will receive some rent subsidy, but that will also be phased out.
Then the sun shines here (almost) every day and the temperature hardly falls below 30 degrees.
Just because you don't need (winter) clothing, you can enjoy 'eating out' here a good number of times.
So for now, just keep enjoying what we all do have.
So in short: the government is once again simply stealing from our pension funds. And this time not once but structurally.
Explained crystal clear. But that is simply the necessary policy for which there is no sound alternative 🙂
Previously, our policymakers still gave us cigars from our own box.
Thanks to policy measures such as these, the awareness is growing in large layers of the population: “L'état c'est moi”.
Thanks to this policy, every average Dutchman, even the klootjesfolk, can finally feel like a Louis the 14th. All Louis XIV, for the friends Sun King, in wet cold frog country 🙂
This also applies to Belgians, notwithstanding the fundamentally different pension systems.
Our politicians have clearly been inspired in recent years by Joseph Caillaux, French Minister of Finance in 1907: « Faîtes payer les pauvres ! Bien sûr, les riches ont la capacité de supporter des impôts bien plus lourds, mais les pauvres sont tellement plus nombreux ».
It is no coincidence that the man also became known (notorious?) for introducing the principle of an income tax.
Dear Mark,
Life is about making choices and the government is making the wrong choices. Their job is to govern the country as best as possible for the Dutch and other residents, and that includes the people. There are certainly alternatives, but you have to make different choices. You should stay away from pensions and state pensions, they were never purchased for nothing. Tax money can only be spent once. An important part of the population is not being listened to enough and they are taking advantage of that. Few French proverbs can do anything about that. The bogus democracy in the Netherlands is in need of revision. By the way, Dutch people are still offered cigars from their own box. This was recently the case with the police collective labor agreement. Also happened to have something to do with the pension. That bag of tricks is still being used. And that French sun king is not that character who poops in every room of his residence and leaves it there to enjoy it, I don't want to be compared to that, thank you kindly.
Beautifully written Rembrandt! But you can also look at it in a slightly different way:
Decades ago, every guilder spent by the government yielded a few guilders in economic growth. Now every euro only yields something in the order of a dime. The pension premiums we pay/have paid are deferred consumption. The pension funds (mandatory) lend a large part of this to the government. However, he no longer uses that borrowed money for investment, but for consumption. And that's not what it's intended for. The result is that we will not get that money back in full, because that is unfortunately impossible due to the policy of our government. This is done insidiously by keeping interest rates below inflation (while pension funds are only viable if interest rates are a few percent higher than inflation). Whether it happens through a government bankruptcy (impossible? unfortunately not) or through the introduction of a special tax to, for example, help the pensioners in the poor euro countries because they have even less to eat than we do. However it happens, the bottom line is that pensioners will continue to lose purchasing power for decades to come. Pensioners will therefore have to save now for later, no matter how little they have to digest. Because it's only getting worse. And it is better not to put that money in the bank, but invest it in gold, for example. Because gold can still offer some protection in difficult times (no guarantee on my part of course).
We can of course blame our politicians for these developments, but the voters themselves have also voted for a social policy that leads to high state expenditure. I have been guilty of that myself at times. There is of course a lot to be said for a social policy, but it must remain affordable. And that is not the case with an aging population and therefore no longer any prospect of economic growth of an average of 3%. The Maastricht Treaty agreed at the time - when we still hoped for annual growth of 3% - that the annual state deficit could amount to a maximum of 3% of GNP. And the total national debt maximum 60%. With the current lower growth, this would have to be significantly reduced, but that is of course not possible now that almost all countries have already significantly exceeded the old maximums. So that's going to end wrong. For example, Italy already has a national debt of 133% and this is increasing every year. Unfortunately. And the Netherlands is also clearly above that 60%.
However, there are two bright spots:
1. The mortality tables are adjusted every 5 years and the pension funds are obliged to take this into account. These tables predict, for example, how old someone who is still working will be. However, this cannot be calculated and cannot be substantiated with statistics. It continues to look coffee grounds. And when I look in the coffee grounds, I see that those predictions are far too positive. And that in turn means that the pension benefits can be spread over a smaller group, which therefore leads to higher benefits. What's so bad about if we only live to be the same age as our parents?
2. The second bright spot is that I cannot look into the future and that my expectations about economic developments in Europe and the policies of our governments (and the ECB) could turn out to be much too pessimistic.
Without wanting to criticize Rembrandt's piece.
I do get lost every now and then when it comes to our pensions.
Simple person as I am, Rembrandt's explanation is tough stuff for me.
I think it will then. But I keep wondering if all this complaining is justified.
When I read (RTLZ.NL ) That the Netherlands has the second best pension system in the world
That the New York Times writes that you had better be Dutch when you retire.
Then I don't think in one gosh, how good are we.
But do realize that we are better off than most countries in the world.
However bad that may be.
Sometimes it's nice to be simple. Sometimes
I don't know whether a good pension system means that you also get a good pension.
A good system generally means that something looks good on paper and that everything is neatly arranged.
That is not the same as the pension fund being able to realize a nice pension for the participants.
Well written story.
Not all Dutch people have built up (or are still building up) a pension with ABP, there are other pension funds that are in even worse or a lot better shape.
My pension fund SFB has slightly increased the pension this year.
greetings ben
Unfortunately I didn't notice it. SFB has become APG in the past, the SFB had a higher funding ratio compared to the APG, so in my opinion the APG is doing something wrong. I think the days when pensioners got a doze with the holidays are in the past. Piles of thanks and phone calls but unfortunately time has changed. Maybe wrong investment choice? APG.
The words old people, young people and pension clash very much and that makes sense because everyone only looks at their own position. The annoying thing about the great Dutch pension and state pension system is that they don't look at the individual person here. Until before the crisis, the average employee paid between 0 and a maximum of 1,5% in pension contributions. Today's employees have been looking at premiums of 6-7% for years. Honestly I have no idea but everyone is already worried if they are ever entitled to anything. Most young people have no idea. In my position at the age of 33, the SVB has already told me that if nothing changes, I will receive state pension when I am 74 years and 8 months old. My feeling therefore says that not only the elderly but also the young people do not have a positive far view. The only difference is that the older people are more likely to see something back from what they have already paid.
My vision for a tied personal pension as quickly as possible so that everyone knows where they stand. Make the investment flexible and provide a clear overview. See example http://www.brightnl.com
Moderator: If you say something like that, you have to come up with a source.
Author's afterword,
Thank you for your responses and a few more comments on that.
First of all, you need to place the government's pension measures in the light of economic conditions. The Netherlands has had an excessive budget deficit and economic contraction in recent years. The solution was chosen by taking a hold of the pension pots and the funds of the housing corporations. It was not possible to purchase directly from pension funds, but by lowering the deductibility of pension contributions and, moreover, by having workers deposit less than the increase in their pension rights, money could still be obtained. As a result, tax revenue rose sharply and wage costs fell, improving the competitive position of the Netherlands. One of the commenters writes that there was no alternative, but that is not true. In France, Hollande introduced a tax for top incomes and in the Netherlands, too, the rate of the highest bracket could easily have been increased, but Mark Rutte and his VVD were not so keen on that. Other Euro countries simply implemented strong government cuts.
Apart from the fact that pensioners are the victims, so are the young people. Their pension accrual is greatly reduced and they hardly ever get a full pension anymore, but I really don't understand why they don't go on the barricades. The only one who is fighting back properly is the FNV, which does not want to have the increase of police officers paid from the 15% reduction in pension (the well-known cigar from its own box). Meanwhile, the (insurance) companies and the government feed the story that young people pay for the elderly. In July there was an interview in de Volkskrant with Jette Klijnsma and she reported that young people paid for the elderly because the money they invested could pay off for longer, but unfortunately she did not mention that young people are also becoming elderly. In the interview, she dreamed of an individual, deductible pension pot and that is actually only one step away from placing everything with private insurance. I therefore have only one advice for young people: increase your capital by paying off your house mortgage on time and set aside a percentage each month to invest yourself for old age.
It is completely unclear to me why the pension funds now have to build up a gigantic, unnecessary buffer of approximately 50 to 60% of the Gross National Product. It is clear that the accrual will be paid for by severely limiting indexations by PFs. If, over time, that buffer is there, then politicians will certainly step up to find a good destination for it, such as a capital tax on pension funds because box 3 is now not taxed or repairing the small pension accrual by young people. In my calculation of the decline in purchasing power, I based myself on the forecasts of the ABP, which expect to reach a funding ratio of 2027% in 127, but given the current, too low pension premiums, I have doubts whether that can be achieved.
Finally, one of you writes about a pension premium of approximately 1,5%, but after the government threatened to intervene in the 80s due to excessive buffers and the pension funds paid back money to the government (30 billion) and the business community, my pension premium has since that time about 6 to 7%. Moreover, those premium discounts were only possible for a limited time because far too much had simply been withheld for years. I don't hear anything about the fact that premiums paid in by me were also paid back to the company at that time.
Good advice from Rembrandt to the youngsters.
No one can now predict how things will develop in the future, you can then respond to that, but pay off your mortgage on time, you will have it in due course. no more housing costs, you build up flexibility, you can sell your house and live elsewhere where it is cheaper, part of your money becomes available or you sell the house and rent it back or start renting elsewhere, you do not have until your death money stuck in your house.
However small it may be, save part of your income, if your income rises, you save a little more, invest it, not in shares, bonds or with an insurer, given the risks, such as the usury policy affair and/or the changing influence of the government on these matters and the costs of management.
Invest in gold Krugerrands, for example, given the storage in them for production, etc. I think it is better in a small roll / chunk of gold, which is a means of payment in the whole world and then you have little or no counterparty risk, put it in a safe. Yes, I know the gold price is being manipulated, but that will certainly come to an end.
If anyone has a better idea, let me know.
In short, do something about it, then you will remain a bit boss in your own house.
Success.
Nico B
Older people who want to spend the winter outside Europe will suffer even more when the world takes cover
the basic insurance will take effect from January 2017, XNUMX.
What will that cost again?
I spoke to a Frenchman today and there the bisis insurance is covered if you don't stay longer than 6 months
will hibernate.
What's next, I'm genuinely concerned.
Peter.
It is to be expected that insurers will come up with offers, either as part of a travel insurance policy separate from the health insurer in addition to the basic policy, or by the health insurer as a supplement to the basic health care policy.
The question is what that will cost and how long you may stay outside the EU/Europe consecutively or annually and whether you will then be exempt from the premium for the period that you stay abroad. To be continued.
It is clear that it will require an additional premium.
Nico B
It's a good thing that pensioners are being cut. Most in Thailand live like gods. People left in a period when early retirement still existed, around the sixtieth year of life, people have been able to live on that for years, with a young Thai in hand of course. Don't squeak now, but dock, so that my generation of over-40s will also have something to enjoy later. Mind you WE only from our 68th year of life….!
Thought not! Go and work for your pension yourself, I did too, from the age of 15, for 47 years. And start saving, investing, investing so that you have some capital to stop earlier. I did that too. And what I didn't? Depend on others!
Dear Fred,
May I recommend that you read the article again carefully and understand what is going on. A government policy that has attacked the pension rights of pensioners and workers.
In addition, you yourself fall into the category of people who benefit threefold. Due to the premium discount, you probably now pay too little pension premium, but you do accrue full rights at the expense of pensioners. The premium discounts mean that you have more net left over and, according to Mrs. Klijnsma, you benefit from the people in their twenties and thirties because their pension contributions yield longer than those of your generation.
Oh, when I retired almost four years ago, the funding ratio of my pension fund was well above 100% because my generation had invested enough. And if you will no longer receive a good pension, it will not be the fault of the pensioners you have stereotyped, but of those who are now at the helm.
Dear Fred, life begins at 40 and the future can look good for you too. Not in the way you apparently propose to do this at the expense of pensioners. Many of us are not sitting here like a God in France and it would behoove you to refrain from making these kinds of statements. Unnecessary hurt has never achieved anything for anyone. In addition, my experience is that if you don't give it to someone else, you won't get it yourself. I have had the advantage of seeing a lot of the world. I know where the people who live like a God in France reside and they are not the retired Jan Modaal people of the Netherlands, residing in Thailand. Most of us are not well off. Together with other people in their 40s, you should ensure that the early retirement scheme is reintroduced and why are you doing this, so that you can also get some rest at a reasonable age? Just as every Dutch person should be allowed to do this. So you do many a favor and speak out against the policy makers of the Netherlands because that is where the problem lies.
Fred, I think you didn't quite get it right, your statement that we shouldn't beep now and that we have to dock now is, to put it mildly, obnoxious. It also seems that you have not fully understood Rembrandt's story.
We raised the Aow for our parents and furthermore contributed to the pension pots ourselves, now it is the turn of people belonging to the group of over-40s to which you belong and not the other way around.
When you are ready for your retirement, by then almost certainly only at the age of 70+, I can hope for you that the system is still the same, that your children or the young people of that time are so social that they still earn the Aow and respect the pension rights of your current age group.
That was the social intention when entering into the Aow and pension accrual.
Maybe then you can live like a god in Thailand with a young Thai in your hand.
Nico B
Still, Fred has a point. Because the government, companies and individuals have borrowed on an exorbitant scale worldwide, economic growth has, as it were, been brought forward. This extra growth has led to an economic boom and thus to strong increases in stock prices and real estate prices over the past decades, as well as high interest rates. The pension funds (and current pensioners) have benefited enormously from this. How else is it possible that with less than 10% premium for 40 years of work you will receive a generous benefit for the next 25 years. That will never happen again. Ruled out.
However, this huge debt position must be reduced otherwise things will go completely wrong and so economic growth will lag behind for decades and share prices will fall rather than rise. Interest rates must also remain low, otherwise it will rain bankruptcies. The future of the pension funds therefore looks bleak and extra buffers can do no harm. In short, the pensioners have benefited from wrong economic policies and the young will reap the bitter fruits of this. They really have reason to complain and not just about their pension. They'll have it worse than we've had it. We (the pensioners) are the lucky ones. Possibly the last generation to experience long-lasting prosperity.
There was once a professor who said that the national debts should be deducted from the pension pots in order to get a fair distribution. I think there is certainly a grain of truth in that. Don't forget the income from the gas fields that has stimulated the economy and maintained many social systems.
In the Netherlands they should also have invested the gas proceeds instead of including them in the budget. Norway is the example of how it can be done.