At the end of last year, the deadline for choosing a pension option by Russians expired.
Citizens (insured persons) born in 1967 and younger by the end of 2015 had to choose: send 6% of the individual part of the insurance premium rate to finance the funded part of the labor pension, or send the full amount of the individual part of the insurance premium rate to finance the insurance part of the labor pension.
In other words, until December 31, 2015, insured persons born in 1967 and younger could choose what their pension will consist of: two parts - insurance and funded, or only insurance.
Especially the choice concerned the so-called "silent people", that is, those who had never before transferred their pension savings from the Pension Fund of Russia (PFR) to non-state pension funds (NPF) or a private management company (MC), did not choose the investment portfolio of the state manager companies.
The fact is that the "silent people" will no longer have the opportunity to form new pension savings, since all contributions will only go to the insurance part of their future pension.
“Active” citizens, those who previously transferred pension savings to an NPF or a management company (changed an insurer), chose the investment portfolio of a state management company, retained the right not only to form the insurance and funded parts of the pension, but also the opportunity to further refuse formation of the accumulative component.
It should be noted that the right to choose the rate of the insurance premium is reserved only for those citizens for whom insurance premiums for the first time began to accrue from January 1, 2014. This category of citizens can, within five years from the date of the first accrual, choose which part of the pension to allocate 6% of the tariff to finance. Until they make a decision, all insurance premiums will be transferred to the formation of an insurance pension. If after the expiration of a five-year period from the date of the first accrual of insurance premiums, the citizen has not reached the age of 23, the specified period is extended until December 31 of the year in which the citizen reaches the age of 23. For example, if a young person received their first salary at 14, they will have the opportunity to make a choice before the end of the year in which they turn 23.
Regardless of which of the above categories an individual citizen belongs to, the right to dispose of the savings formed earlier remains. These funds will continue to be invested and paid out to citizens after they retire. In terms of transferring pension savings, nothing really changes. Citizens can choose a UK or NPF, as before. Even if you have refused to further form a funded pension in favor of an insurance one, you can transfer to the Criminal Code or NPF what you have accumulated before 2014.
However, there is one very significant feature that you need not only to know, but also to take into account.
Now, it is possible to switch from PFR to non-state pension funds (NPF) and vice versa, as well as to change one NPF to another, while retaining the rights to investment income, no more than once every five years.
In accordance with the provisions of the Federal Law of December 28, 2013 No. 410-FZ “On Amendments to the Federal Law “On Non-State Pension Funds” and Certain Legislative Acts of the Russian Federation”, which entered into force on January 1, 2015, insured persons can apply for transfer (“urgent” applications) or early transfer (“early” applications) to the NPF or to the FIU.
The difference between an application for transfer and an application for early transfer lies not only in the different terms for considering such applications, the terms for the actual transfer to a new insurer and the terms for transferring pension savings funds, but also in the different procedure for calculating pension savings funds to be transferred during such transitions.
On an “urgent” application, the transition takes place in the year following the year in which the five-year period expires from the year in which such an application was filed. That is, if in 2015 an application was submitted to transfer from the PFR to the NPF, pension savings will be transferred to the NPF in the first quarter of 2020. At the same time, the citizen is guaranteed the entire amount of pension savings, regardless of losses in the financial market, and retains the entire investment income. If a citizen's choice changes during such a long period, he can file a notice to change the insurer.
According to the "early" application, the transition is carried out in the year following the year of filing such an application. For example, an early transfer application submitted in 2015 will be considered in Q1 2016. However, in this case, the insured person loses investment income. Moreover, in case of a loss from investing funds, the result will be fixed, and the amount of savings will decrease. Thus, an early transition has two significant risks - non-payment of investment income and the lack of a guarantee to maintain the "nominal value" of the contributions paid.
Therefore, not only the term of the transfer of funds, but also the amount of investment income, and the guarantee of the safety of funds depend on the right decision.
Which insurer would you like to entrust with the management of your future funded pension funds?
Such an insurer may be the FIU or one of the NPFs. If one of the NPFs is selected, you should ask if the fund is a participant in the system of guaranteeing the rights of insured persons. This is important, since the inclusion of NPFs in this system is a condition for the transfer of funds. In the last two years, the state has been putting things in order in the pension savings management system - NPFs have been corporatized, 33 of them have entered the system of guaranteeing the rights of insured persons. In addition, it will be necessary to conclude an agreement on compulsory pension insurance with NPFs.
If the Pension Fund of Russia is chosen, determine for yourself a management company - state-owned ("Vnesheconombank") or one of the private ones.
35 private management companies are admitted to savings management, with which the PFR has concluded agreements on trust management of these funds. For those who choose a management company (state or one of the private ones), this means that their money does not go to the NPF, but remains in the Pension Fund of Russia. In addition to the difference in the amount of commissions taken by NPFs and MCs, there is such a nuance: those who transferred their savings to NPFs will be paid a funded pension at the time of their well-deserved rest by this same non-state fund. In the case of the Criminal Code, the PFR will pay the funded pension.
BASIC CONCEPTS
Agreement on compulsory pension insurance- is concluded with a citizen if, for the formation and investment of his pension savings, he has chosen a non-state pension fund (NPF) as an insurer. This is an agreement according to which the NPF is obliged, upon the occurrence of pension grounds, to assign and pay the citizen the funded part of the labor pension or pay his successors.
Insured persons- Citizens covered by compulsory pension insurance.
The insured persons are citizens of the Russian Federation, as well as foreign citizens permanently or temporarily residing on the territory of the Russian Federation and stateless persons:
- working under an employment contract or under a civil law contract, the subject of which is the performance of work and the provision of services, as well as under an author's and license agreement;
- self-employed (individual entrepreneurs, lawyers, notaries engaged in private practice);
- who are members of peasant (farmer) households;
- working outside the territory of the Russian Federation in case of payment of insurance premiums to the Pension Fund of the Russian Federation;
- who are members of tribal, family communities of the small peoples of the North, engaged in traditional sectors of management;
- clergymen;
- other categories of citizens whose legal relations on compulsory pension insurance arise in accordance with Federal Law No. 167-FZ of December 15, 2001 "On Compulsory Pension Insurance in the Russian Federation".
OPS in Russia is carried out by insurers - the Pension Fund of the Russian Federation and non-state pension funds.
Compulsory insurance coverage- fulfillment by the insurer of its obligations to the insured person upon the occurrence of an insured event through the payment of a labor pension, social benefits for the burial of deceased pensioners who were not subject to compulsory social insurance in case of temporary disability and in connection with motherhood on the day of death.
Individual (personified) accounting- organizing and keeping records of information about each insured person for the implementation of his pension rights in accordance with the legislation of the Russian Federation.
This information relates to the work (insurance) length of service, insurance premiums for the insurance and funded parts of the labor pension, etc.
The Pension Fund of the Russian Federation opens an individual personal account for each insured person (ILS). The size of the mandatory pension insurance pension depends on the funds accumulated in the ILS. The higher the earnings and the longer the length of service of a citizen, the more funds will be reflected in his individual personal account.
Policyholders- all legal entities, without exception, as well as individual entrepreneurs and self-employed persons - lawyers, notaries, etc., engaged in private practice, paying insurance premiums for their employees (insured persons) or for themselves personally to the Pension Fund of the Russian Federation .
Insurance number of an individual personal account (SNILS)- the number of the citizen's individual account in the compulsory pension insurance system. This number is indicated in the compulsory pension insurance certificate.
Insurance certificate of compulsory pension insurance- a document that a citizen receives in the territorial body of the PFR at the place of residence by filling out a questionnaire. A citizen who first came to work receives an insurance certificate through the insured (employer).
The insurance certificate indicates: ILS number, last name, first name, patronymic, date and place of birth, gender, date of registration as an insured person. An insurance certificate is presented when applying for a job, when concluding an employment contract, when applying to the Pension Fund of the Russian Federation on any issue, including for the appointment (recalculation) of a pension.
From the moment of registration in the system of compulsory pension insurance, data on the length of service, accrued and paid insurance premiums of the insured person for the appointment of a pension are confirmed on the basis of information from an individual (personalized) account.
State Management Company (GUK)- a legal entity authorized by the Government of the Russian Federation to invest pension savings transferred to it in trust management by the Pension Fund of the Russian Federation of citizens who did not use the right to choose a private management company or NPF, as well as those citizens who knowingly entrusted the management of their pension savings to a state management company .
At present, the functions of the GMC are performed by the State Development Corporation "VEB.RF" (VEB.RF, VEB).
VEB.RF forms two investment portfolios for investing pension savings of citizens:
- investment portfolio of government securities, consisting of government securities of the Russian Federation, bonds of Russian issuers guaranteed by the Russian Federation, cash in rubles and foreign currency,
- expanded investment portfolio, which is formed from government securities of the Russian Federation and securities of constituent entities of the Russian Federation, bonds of Russian issuers, cash in rubles and in foreign currency on accounts with credit institutions, mortgage-backed securities issued in accordance with the legislation of the Russian Federation on mortgage-backed securities , deposits in rubles and foreign currency, securities of international financial organizations.
In order for the funds of pension savings of citizens to be invested in the investment portfolio of government securities, it is necessary to submit an appropriate application to the territorial department of the Pension Fund of the Russian Federation. If a citizen did not apply to the FIU with an application to choose a portfolio of a state or private company or to transfer to an NPF, his funds will by default be invested in the expanded investment portfolio of the GAM.
Income from investing pension savings- dividends and interest (income) on securities and bank deposits, other types of income from operations for investing pension savings, net financial result from the sale of assets, financial result reflecting the change in the market value of the investment portfolio on the basis of revaluation (in the manner determined by the Government Russian Federation).
The investment of pension savings, depending on the choice of a citizen, is carried out by a state management company, a private management company or a non-state pension fund.
Investment of pension savings- activities of the state management company, private management companies or non-state pension funds to manage pension savings. The purpose of investing is to preserve and increase them. Pension savings funds are placed only in low-risk assets (cash and securities) permitted by Russian law:
- government securities of the Russian Federation;
- government securities of the subjects of the Russian Federation;
- bonds of Russian issuers;
- shares of Russian issuers established in the form of open joint stock companies;
- shares (shares, shares) of index investment funds placing funds in government securities of foreign states, bonds and shares of other foreign issuers;
- mortgage-backed securities issued in accordance with the legislation of the Russian Federation on mortgage-backed securities;
- cash in rubles on accounts with credit institutions;
- deposits in the currency of the Russian Federation and in foreign currency in credit institutions;
- foreign currency on accounts in credit institutions;
- securities of international financial organizations admitted to placement and (or) public circulation in the Russian Federation in accordance with the legislation of the Russian Federation on the securities market.
The Government of the Russian Federation may establish additional restrictions on the investment of pension savings.
Investment portfolio- assets (cash and securities) formed from funds transferred by the Pension Fund of the Russian Federation to the management company under one trust management agreement and separated from other assets.
The investment portfolio is formed by the management company in accordance with the investment declaration, which is an integral part of the trust management agreement for pension savings, and additional restrictions established by the Government of the Russian Federation.
"Silent" (common expression not enshrined in legislation) - citizens who did not use the right to choose a state or private management company or a non-state pension fund to manage their pension savings. The funds of these citizens are by default invested as part of an expanded investment portfolio of the state management company.
Inheritance of pension savings
The funded part of the pension is not inherited according to the laws of inheritance, but is transferred to the legal successors of the deceased citizen.
Non-state pension fund (NPF) is a non-profit social welfare organization.
In the pension insurance market, NPFs carry out several types of activities, including:
- activity on non-state pension provision of NPF participants in accordance with agreements on non-state pension provision;
- activity as an insurer for compulsory pension insurance;
- activity as an insurer for professional pension insurance.
Retirement savings These are funds that are formed from:
- amounts of the employer's insurance premiums for the funded part of the employee's labor pension under compulsory pension insurance;
- the amounts of additional insurance premiums for the funded part of the labor pension, including within the framework of the State Co-financing Program (from the citizen himself, the state and the employer);
- funds of maternity (family) capital, aimed at the formation of the funded part of the labor pension.
Assignment of pension savings
Assignees may receive the pension savings of a deceased citizen, recorded on his ILS, if the death of a citizen occurred before the assignment of the funded part of the labor pension to him or before the recalculation of the amount of this part of the pension, taking into account additional pension savings.
The legal successors are the persons indicated in the citizen's application for the distribution of pension savings (an agreement on compulsory pension insurance concluded by the insured person with a non-state pension fund). This application is submitted to the Pension Fund of the Russian Federation (or to the NPF). In the absence of this application (agreement), the relatives of the deceased citizen are recognized as legal successors, to whom the payment of pension savings is made regardless of age and state of working capacity in the following sequence:
- first of all - to children, including adopted children, spouse and parents (adoptive parents);
- in the second place - brothers, sisters, grandfathers, grandmothers and grandchildren. In order to receive these funds, the successors must apply to the territorial office of the Pension Fund within six months from the date of death of the insured person.
Management company selected by competition (in everyday life - a private management company, PMC) is a legal entity licensed to manage investment funds, mutual investment funds and non-state pension funds. Selected by tender for the investment of pension savings transferred to it for trust management by the Pension Fund of the Russian Federation in accordance with citizens' applications for the choice of an investment portfolio (management company).
Only those management companies with which the Pension Fund of Russia has concluded agreements on trust management of pension savings are entitled to carry out trust management of pension savings funds. Competitions for the selection of management companies are held annually by the Federal Service for Financial Markets.
An integral part of the trust management agreement is the investment declaration of the management company, which establishes the purpose of investing pension savings transferred to it by the PFR, the investment policy of the management company, as well as the composition and structure of its investment portfolio.
The management company has the right to offer several investment portfolios. For each investment portfolio, the PFR enters into a separate trust management agreement with the management company.
The management company is obliged to invest pension savings exclusively in the interests of the insured persons - reasonably and in good faith, based on the need to ensure the principles of reliability and profitability. Income from investing pension savings is not the property of the management company, but is attributed to the increase in funds transferred to it for trust management.
In accordance with the current legislation of Russia, every adult working citizen monthly transfers part of his personal income to his own pension account. Technically, this responsibility rests with the employing company. In this regard, the majority of Russians do not know or do not think about the opportunities that are legally open to them. Let's figure out how to properly invest pension savings.
Pension savings are a set of funds that include the amount of all insurance premiums that are used to finance the funded part of the labor pension.
Over time, the money on the specified account of a person will become more. As a result, they will become the basis of a citizen's pension payments in the future, after he reaches the age limit or work experience established by law.
In accordance with the legislation of the Russian Federation, these funds are state property. At the same time, they do not participate in the formation of the federal or relevant regional budget.
Sources of pension savings
By law, there are several different sources from which money can go into a person's retirement account. It can be replenished with:
- mandatory insurance premiums;
- additional insurance premiums;
- voluntary contributions made by employers;
- maternity capital or part of it;
- received investment income.
Pension savings of a citizen are subject to mandatory accounting on a special personal account containing the entire set of receipts from the above sources.
Who better to trust your savings
In the recent past, the State Duma of Russia adopted a federal law, according to which any citizen is vested with the right to invest pension savings at his own discretion.
At the same time, it should be borne in mind that until a person has received a statement about how to dispose of these funds, they are under the jurisdiction of Vnesheconombank. Since 2003, this company has been a state management company (GUK), which has been carrying out trust management of citizens' pension savings money.
So, today anyone can trust their own pension savings:
- private management companies (MC);
- state management company.
The final results of the ongoing investments will largely depend on the correctness of the choice made. Management companies are specialized enterprises or organizations that have special rights that allow them to carry out an exclusive type of activity and manage the pension savings of citizens.
All management companies must obtain special licenses that allow them to engage in such investment activities.
Pros and cons of public and private companies
In general terms, the situation regarding the choice of an organization to manage one's own pension savings can be represented as follows: the state management company is more reliable, while private companies offer higher returns.
At the same time, it should be taken into account that if a person has chosen the option with a private company, then the state will not be responsible for the results of its activities. Thus, the risks in this situation are borne by the citizen himself.
The main disadvantage of the GAM is the extremely low profitability of investing pension savings. It can often fall below the actual rate of inflation.
If you, after analyzing all the existing risks, decide to stay at a non-state management company, then you need to take the following steps.
- Study the special list approved by the Pension Fund (PF) of Russia and choose the organization that interests you.
- Make a choice of one investment portfolio, of course, in the case when such services are provided by your management company.
- Write an appropriate application and send it to the Pension Fund of Russia before the end of this year.
Currently, there are a large number of non-state pension funds (NPFs) that will gladly take over the management of pension savings. An exhaustive list of NPFs is located in one of the sections of the official website of the Central Bank of the Russian Federation.
To confirm his own choice, a citizen also needs to write and submit applications in accordance with the established model.
Unfortunately, today there is no ready-made solution that would simultaneously provide citizens with the security of their pension savings and high profitability from their investment.