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– The regulation that “everyone” was waiting for arrived this morning, says savings economist Bjørn Erik Sættem in Nordnet to Dinside.
It refers to the government press release that the Own Pension Account (EPK) will be introduced as of January 1, 2021. This means that around 1.5 million private sector employees will be able to collect all your pension income from defined contribution pension plans in a separate pension account.
Finance Minister Jan Tore Sanner says EPK will provide lower costs and a better overview of pension savings for employees; generally more ownership of your own pension.
– In my opinion, EPK is the biggest pension news in the private sector since mandatory occupational pensions were introduced in 2006. Eliminate unnecessary administrative fees, leaving more pensions for clients, says savings economist Sættem .
All about EPK: cheaper and easier pension savings
Few are in control
Storebrand is also very happy that EPK is ushering in the new year. According to a recent survey conducted by them, 700,000 Norwegians say they have no control over their pension plan.
Furthermore, only 16 percent of all employees have pension savings of the first crown today. Most of them earn well and already have high pension income, but those who do not run the risk of becoming pensioners, and they are often women.
– Many people think that retirement is complicated, and several different pension certificates and providers do it no easier. The introduction of EPK is therefore an important step in making pensions more transparent and easier to understand, says pension advisor Lars-Erik Eriksen in Storebrand to Dinside.
Sættem at Nordnet hopes that the introduction of the pension account will mean that more people have an active relationship with their occupational pension.
– Too many people have too low a stake, which can cause you to lose large sums of money in retirement. Retirement is long-term, and then you should save with a high stake, even if it fluctuates along the way, he says.
This is your own pension account (EPK)
- The rules for EPK are that employees in companies that have a defined contribution pension plan must collect their pension income from a previous job (certificate of pension capital) and manage it together with the pension capital that the employee earns with his current employer, unless the employee reserves against such charge.
- The capital of the pensions will be collected and managed, in principle, in the employer’s pension plan.
- However, the employee can choose to manage his pension account with a pension provider of his choice.
- Also, the employee can alternatively choose not to cash in his previous pension capital certificates, but to keep them where they are managed today.
Source: Regjeringen.no
The pension trap that costs you two million losses
– The pension reform with which you can “sleep”
Only 17 percent of us have heard of our own pension account, but the plan covers up to 1.5 million.
– Basically, this is a transition where you can sit quietly on the boat, but still we always recommend everyone to have a conscious relationship with their own pension plan, says Eriksen in Storebrand.
For example, you can have a more mindful relationship with your pension through apps and other digital solutions.
– The good news is that EPK is the pension reform you can “sleep on” and still get the benefits, says the pension advisor.
These can become pension losers due to pandemic
So what happens in 2021?
Employees covered by EPK will receive information from their employer prior to filing.
During February 2021, the employee will receive information from the company’s pension provider about which pension capital certificates the employee has that will be transferred to EPK and which pension provider manages them. The employee will also receive information from other pension providers who administer pension capital certificates for the employee.
The information from the pension providers will include a guide that the employee can log into Norskpensjon.no for more information on the pension capital certificates.
