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Every month, a certain amount of euros is deducted from your salary and transferred to the fund. This is human money that you cannot withdraw at any time you want, although bank-owned fund managers will charge a management fee each year.
And the more a person accumulates, the more taxes they will pay because they are calculated as a percentage of the property’s value.
The article on the portal tv3.lt about the fact that one’s money cannot be withdrawn even in the event of a terminal illness has received many comments and letters from readers. Residents are outraged and misled by this order.
However, the Bank of Lithuania says that this is the law (to the development of which, by the way, the bank’s specialists also contributed). According to its specialists, if a person who accumulates a pension is at risk of suffering a fatal disease, he should buy additional health insurance and not use his own money in the fund.
Pay several tens of euros a month
Retired Ona told tv3.lt that she had accumulated money in the second pension pillar because she planned to undergo the necessary eye surgery and then go on a trip.
“I have accumulated 6 thousand. However, I cannot withdraw them. I do not understand why the state has to decide how to use my money.
For example, a man who retired 10 years ago saved well-used money for a family purchase. And I can’t do it anymore ”, the woman complained.
Another retiree, Jūratė, resented the portal for having accumulated several thousand euros, but now he receives only 19 euros per month.
“It is determined that at age 80 I will receive 19 euros each. Why can’t I withdraw the full amount at once? After all, how much money will your administration eat. With such a law, the government only seeks to make fun of the people , not help her, ”said the woman.
Another pensioner, Regina, said she had accumulated 20,000 in the second pillar pension fund. euros.
“Now I have enough pensions from Sodra for basic needs. So I don’t really need a monthly pension of 90 euros.
I still want to travel, reimburse medical expenses, buy clothes. But I can’t, because otherwise the pension funds will suffer if I withdraw all the money. I don’t understand why older people are so discriminated against. Why do we have to take care of the welfare of the pension funds? ”Regina asked rhetorically.
She assured him that she wanted to use the money now while she was alive.
“I am 70 years old. And I would like to withdraw all my money and spend it, not expect something,” said the woman.
Offers health insurance
The portal tv3.lt asked the Lithuanian Pension and Investment Fund Association (LIPFA) and the Bank of Lithuania if there are exceptions, such as health problems or illnesses, that allow residents to withdraw previously accumulated money.
Head of the Investment Services and Corporate Supervision Division of the Bank of Lithuania Specialist Viktorija Dičpinigaitienė stated that each financial product has its own purpose and purpose.
“Pension funds are intended to accumulate funds for old age, when a person will no longer be able to receive income from work. The legislation does not foresee any use of this accumulated property other than for the subsistence of people of retirement age.
Let’s look at an example: if a person has health insurance but steals their apartment, the person cannot use health insurance to cover damage caused by the theft. The pension fund market is today regulated in the same way, so the purpose of use would only be a pension and not other events not related to old age ”, commented the specialist.
However, he agreed that the topic of health is delicate and evocative.
“However, for financial products to be used for their intended purpose, there must be rules, so people who want to protect themselves from health-related disasters must choose health insurance or accumulate additional funds in, for example, funds from level III pensions.
Here, funds can be withdrawn before reaching retirement age, but the objective of the second pillar, to which the state also contributes, is one: that we should not drastically change our lifestyle in the face of declining income after reach retirement age, ”he said. V. Dičpinigaitienė.
Take a month to change your mind
Gintarė Saulytė-Šulgat, representative of the Lithuanian Pension and Investment Fund Association (LIPFA), stated that the laws regulating the accumulation of pensions in the second pillar do not provide for the possibility of terminating the participation and withdrawing the funds accumulated in the pension fund before receiving a pension, unless a participant is awarded a prior Sodra pension.
“Another exception applies when a Level II accumulation contract is concluded for the first time. A Level II contract entered into for the first time can be terminated by notifying the pension accumulation company in writing within 30 days after the conclusion of the contract, ”said a representative from LIPFA.
According to the Association, at the end of the first quarter of this year, the “savings” or, more precisely, the accumulated assets of future pensioners accumulated in the second pillar of pensions amounted to 4,886 million LTL. (4,496 million euros at the beginning of the year).
Since the beginning of this year, pension fund managers can deduct up to 0.5 percent. taxes on the value of assets under management. Thus, your maximum possible deductions on the assets currently managed would be 24.43 million. euros.
More than 80% or 1.37 million people participate in the second pension pillar that operates alongside the Sodra pension system. Lithuanian workers.
Thus, per capita accumulating a per capita pension is around 3.5 thousand. accumulated assets.
The association itself calls these assets “savings”, although, unlike, say, money in a bank account, for some reason people cannot take it out and use it at their own discretion.
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