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Only BGN 43 per person was added to the lots over half a year, BGN 20 less than the average insurance
Private funds still managed to recover, they already have more money than at the beginning of the year
BGN 481,473,000, paid as a second pension contribution by more than 3.8 million workers in Bulgaria, were burned in the first half of 2020. The reason is the collapse of the stock markets at the beginning of the year due to the COVID-19 pandemic and the global shutdown of economies.
This is clear from the statistics published by the Financial Supervision Commission on the activity of private universal pension funds in the first half of the year.
BGN 752 462 000
are imported to
private
money
safe
contributions
during the first six months of 2020, according to data published by FSC.
At the same time, the funds increased the value of their assets by only BGN 270,989,000 compared to the beginning of the year, which means that in reality more than BGN 481 million of the contributions for the second pension went to cover the stock market losses of universal pension funds.
In universal pension funds, it is mandatory to pay pension insurance under the so-called second pillar born after January 1, 1960. According to the FSC, they have accounts of more than 3.8 million people. The contribution amounts to 5% of the income of all those subject to insurance in private funds. On the other hand, upon retirement, the funds must pay the so-called second pension. The first pensions must begin
to turn off
since the fall of
the next
year
The asset value of the universal funds at the beginning of 2020 was BGN 13.2 billion. At the end of June, they already had BGN 13.48 billion, according to FSC data.
This means that the funds have managed to recoup the losses from the stock market crash caused by the coronavirus.
The biggest
collapse in
savings
for a second pension
it was in march
Then the private universal pension funds ended the month with more than BGN 482 million less than at the beginning of the year. Compared to February, the losses were almost BGN 586 million.
In reality, the losses of the universal funds exceeded 1/3 of the social security contributions paid to them for the whole of 2019.
In April, the universal pension funds managed to recover around BGN 186 million in the value of their assets. However, FSC data shows that most of the reimbursement is due to the 113 million BGN received this month as contributions to social security.
In May, the funds managed to recover a further BGN 264 million of the money for a second pension. But again
source of
high
value of
the assets are
because
received in
they sure
contributions,
according to the statistics published by the commission.
A more significant recovery of private pension funds reported at the end of June.
They then add more than BGN 301 million to their assets and fully cover their losses from the previous months.
The social security contributions paid in June amounted to just over BGN 128 million and already most of the increase in the value of assets is due to investment returns and not money paid for the second pension.
The coronary crisis has also caused a very low increase in individual second pension accounts, according to data from the Financial Supervision Commission.
At the end of June, the average value of a pension account was BGN 3,515.13. Compared to the end of 2019, when the value of the accounts was on average BGN 3,471.85, the increase is only BGN 43.28 per person.
So it turns out that the accumulation over half a year is BGN 20 less than the average amount of the monthly installment made by 3.8 million Bulgarian workers per month.
As in three of the funds – “NN”, “Toplina” and “Instituto de Seguro de Pensiones”, the accounts at the end of June have less money than at the end of December 2019, according to data from financial supervision.
At the same time, NN has the largest average account size: BGN 4,156 This is the only universal fund where the value of accounts has exceeded BGN 4,000 per insured.
The next largest accounts are at DSK Rodina and CCB-Sila, and in both funds the average value of a lot is just over BGN 3,800 per person.
Less money –
only 1708 bgn
insured, there is
at the Universal
pension fund
“Future”
The values of the accounts in the funds “Toplina” and “Instituto de Seguro de Pensiones” are below BGN 2,000.
On average, 60% of savings for a second pension is invested in debt securities issued by a government or the ECB, according to FSC data for the first half of 2020. However, this general trend is not followed by funds of smaller universal pensions such as CCB-Sila ”,“ Badeshte ”,“ Toplina ”, in which between 30 and 50 percent of the savings for the second pension are invested in shares.
For other universal funds, investments in stocks range from 17 to 23%. According to them, investing in stocks is more risky and, although at some point it brings higher returns, it can carry a risk to people’s savings in universal funds.
The earliest end of the year is the period in which such a recovery of funds can be expected, so that funds do not accumulate mainly from insurance paid on them, market experts commented.
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