Pension: Can new impulses stop the negative trend?

The stock of Riester pensions in 2017 could only increase by around 23,000 contracts. In 2010, however, the plus was more than one million contracts. Above all, the low-interest phase is the classic Riester pension insurance. However, the negative trend could be stopped by new impulses for state-subsidized old-age provision.

The current figures of the Federal Ministry of Labor on the existence of the Riester treaties speak a clear language: The subsidized via allowances and tax benefits private old-age provision can hardly convince consumers . In 2017, the Riester pension recorded an increase of just 23,000 contracts. The low growth is mainly due to the development of the classic Riester pension insurance and the bank savings plans. Here, the stock decreased by more than 110,000 contracts.

These forms of private pensions are particularly affected by the persistently low interest rates . For example, insurers are currently only allowed to promise a guaranteed interest rate of 0.9 percent. By contrast, before the onset of the financial crisis in 2012, the guaranteed interest rate was 2.25 percent.

Two winners and two losers in the Riester pension

While low interest rates continued to diminish interest in Riester bank savings plans and annuities last year , housing resident Riester added. One reason for this is the currently favorable interest rates for real estate loans. The investment fund contracts are also on the rise, as savers can use them to combine state subsidies with the good return prospects on the stock market. Overall, both forms increased by more than 135,000 contracts last year.

Higher allowance and new allowance

In order to increase the attractiveness of the Riester pension, the Federal Government has recently not only increased the basic supplement for insured persons. In addition, private old-age provision is no longer fully credited to the basic pension in old age if savers of retirement age are dependent on social benefits.

In the coalition agreement, the Union and SPD have also agreed “to initiate a dialogue process with the insurance industry with the aim of rapidly developing an attractive standardized Riester product .”

Riester pension must be simplified

The German Insurance Association (Gesamtverband der Deutschen Versicherungswirtschaft) sees the new government as having a duty to further develop private old-age provision, for example by reducing bureaucracy. Thus, both the products and the promotion should be easier , calls its chairman of the board, Jörg von Fürstenwerth. In his view, a standardized Riester pension could help to give consumers an overview of the tariff jungle. Currently, the market is very complex and confusing.

In addition, self-employed persons should also be included in the eligibility group . Currently, the Riester pension is aimed at employees and persons who are covered by statutory pension insurance.

Tip: Experts emphasize that a Riester pension through state support, especially for families can still be useful . However, whether the private pension is really worth it, depends on the costs, for example, incurred for the contract. The higher these are, the smaller the pension cushion is. Interested parties should therefore compare several offers with the help of a professional, in order to find their personal best precautionary strategy.

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