From year to year, the topic of pensions is being discussed more sharply. “How to survive on a minimum?” a next-door-living grandma is alarmed. “A non-governmental mutual funds? Does they work in Ukraine?” one of my friends is astonished.
Let’s take a closer look on the issue of non-governmental BMFs in Ukraine and how many pensions we may get.
An average Ukrainian never reaches beyond the so-called basic level in terms of receiving his/her pension, anticipating it in distant future, while dutifully paying all ongoing taxes. I don’t mind. It does work worldwide. Still, there is a “but”. Additionally, to the mentioned above cycle, the developed countries have several related programs such as corporate, insurance and private pension funds. Lack of knowledge on how to set up a multiplied pension is what I noticed the most highlighted feature of all Ukrainian citizens.
“How much may I get?” one may ask assuming. Among all, non-governmental BMFs give the option to double the minimum.
Let’s implement the theory into practice and get further clarification.
On what and how it works. The system of non-state pension funds is for the “wise”, those aiming to take their future under control. Cheers if it rings any bells! Thus, you become a member having decided to receive an additional pension and save money in the fund. From that point, you have your personal account, which you can either top up at any time yourself or request a third party to do it for you. The money in this account brings yields added to the deferred amount. The account itself is your property and, yes, you can even inherit it.
On retirement age. A non-governmental mutual fund will give you the option to retire 10 years earlier than the official term, minimum at the age of 50. Although here you will have the options to choose and regulate both start of payments and their range: a year, two, ten or twenty years.
On cash. How much you will get for pension when bought the non-governmental BMFs? There are number of factors influencing the final total. Firstly, it depends on the amount you invested. Secondly, the term to maturity maters. Thirdly, consider monthly or set-period payment. Surely, the payment for set period is higher. The longer the term of maturity, the more you are benefiting on it. Could I just say, there is one nicer bonus. Annually, you as a depositor may return the tax on the amount paid, 18% in our case, the tax on income, will be yours.
On security and guarantees. The three-stage security system is an undeniable argument in favor of non-governmental BMFs to be trustworthy. How does it work? AMC manages and invests money being at the same time not the only element in the chain and having no access to the finances as they are under control of a non-affiliate bank. The ultimate chain in the link is the administrative company keeping records and making audits of finances while non-subjected to either of the bodies mentioned. Do you require even more guarantees? That let me refer to the fact that according to the Law, non-governmental BMFs can never declare bankruptcy. If case of any collapse, all the funds of the depositors shall be transferred to another BMF. Therefore, your pension is guaranteed.
How does it work in OTP Capital? We have been among the market leaders for 13 years. During this time, we have survived the crisis of 2008, the Revolution of Dignity, and the annexation of Crimea. Now we are experiencing a coronavirus pandemic. However, neither market fluctuations nor evolutionary innovations change the course of thing when Ukrainians retire as the time passes by and we always pay the pension. We give the option to keep your money both in hryvnia (with the OTP Pension Fund) and in US dollars (with the Freeflight Fund). The balance between yields of a debt instrument and its reliability is our goal. Yet could we just add, let our figures of fund returns speak for us.
As a conclusion, could we just say, one pension is not enough for a Ukrainian to feel happy. One more may be not enough as well, but definitely, it will provide better opportunities for self-maintenance. You are the one who choose, let yourself to be happy. We are here to help you!
