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29.06.2017 12:46 Age: 209 days
Category: Press Releases

BETTER FINANCE APPLAUDS EU PROPOSAL FOR A PAN-EUROPEAN PERSONAL PENSION (PEPP) TO DEFUSE THE TICKING PENSIONS TIME BOMB


The global pensions gap is currently estimated at $70 trillion and forecasted to mushroom to $400 trillion by 2050: this is by far the biggest financial issue facing EU citizens, their children, and grandchildren.

With government pensions on the decline, and occupational ones covering only a minority of citizens and pension needs, all Public Authorities are asking EU citizens to save more and earlier for retirement. They are, surprisingly, omitting another crucial requisite for pension adequacy: decent net real (i.e. after inflation) returns. Compounded returns are the main – if often ignored - driver for pension adequacy.

Independent research into the real net returns of European pension savings has shown that fees and commissions severely hurt returns for pension savers. Pension savings products too often significantly underperform capital markets, and even sometimes destroy the real value of pension savings over the long-term. This in turn is due to the extreme fragmentation of the pension saving products markets within the EU, to the complexity and opacity of many products, and to insufficient competition.

Read the full press release here.


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