A passive pension fund is being added to SEB’s range of pension funds

SEB’s survey revealed that almost every other person saving for pension in Estonia would like to speak to a specialist before choosing their pension fund. Close to two-thirds prefer their pension assets to be invested by fund managers. At the same time, around one-tenth do not consider the active management of their pension assets to be important, which is why SEB will update their product range in the 2nd pension pillar, launching the new automatically managed SEB Energetic Pension Fund Index.

According to the survey, more than 40 per cent of respondents are not aware of the amount of their pension savings and the strategy of the pension fund chosen. They know even less about management fees, and review the results of their pension funds no more than a few times per year. Close to 40 per cent of the respondents are not ready to make pension investments themselves and manage the related risks, and 57 per cent want to consult a specialist before making an investment decision, to find the best solution for their savings needs.

“The survey, however, also revealed that every sixth respondent is willing to manage their pension savings and investment risks themselves. One third would like additional information, in order to decide on whether to follow the state of their pension savings themselves, and to swap their funds quickly if needed, or to leave all active management to be taken care of by the fund’s managers. There are not many investors ready to save their pension assets through a passive fund, but we want to offer a full range of products and to meet our clients’ expectations. This is why we are updating the selection of the SEB 2nd pillar pension fund, launching a new, automatically managed SEB Energetic Pension Fund Index involving a higher risk level,” commented Indrek Holst, Chairman of the Management Board of SEB Elu- ja Pensionikindlustus.

The new, automatically managed or passive pension fund follows international market indexes when making investments, and the distribution of share and bond investments in the fund will remain unchanged regardless of the developments on the financial markets.

“The survey showed that the new fund is mainly awaited by informed pension clients. It is primarily suited for a client who has prior experience in the field of investing and is able to assess the risks involved. The new fund has also received increased attention from young people - as the saving period is long, they still have time to move between the actively and passively managed pension funds, as necessary. There have been periods in history where the investment decisions made by fund managers have been more justified, but there are moments in recent history when automatically managed funds have been more successful. This is why the main rule of investment must be kept in mind - the past rate of return is not a guarantee for the future rate of return, and a fund with a suitable risk level needs to be chosen.

SEB also wants to offer the best savings solutions for those clients whose saving period is shorter or who want to avoid bigger investment risks. This is why SEB will also update their offer of actively managed pension funds, reducing the fund management fee for the Conservative Pension Fund from the present 0.77 per cent to 0.49 per cent, which is as affordable as the management fee of the new passively managed fund.

Funded pension payments can be made to the SEB Energetic Pension Fund Index after the Financial Supervision Authority has registered the terms and conditions of the fund.

*The data used is based on a pension survey carried out by SEB in the summer of 2016, among 1724 people between the ages of 20-63.

For more information:

Maarja Gavronski
Project Manager for Communication
Marketing and Communications Division
SEB Pank

Phone +372 665 5270
Mobile +372 5656 5785
Address Tornimäe 2, 15010 Tallinn
E-mail maarja.gavronski@seb.ee
www.seb.ee

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