Revision of Pension Fund Rules Eff. 01.01.2018

22.09.2016

The continuing rise in life expectancy and historically low or even negative interest rates pose a major challenge for pension funds. Pensions must be paid for an increasingly long time, while at the same time the return on assets is declining sharply. Having adapted the invest-ment strategy to the new investment climate some time ago, the Board of Trustees has now decided to take steps on the benefits and contributions side to ensure the financial and struc-tural stability of the Schindler Pension Fund in the long term.

The Fund's new direction will be achieved by adjusting the actuarial foundations on which it rests. Meanwhile, compensation measures are planned to soften the effects on future bene-fits as much as possible. The revision covers the following points, in particular:

  • The conversion rate at age 65 will be reduced from 6.0% to 5.2% as of January 1, 2018 (for those born in 1953); it will be reduced by a further 0.01 percentage points for every year thereafter
  • The actuarial interest rate is to be reduced from 3.0% to 2.5%
  • Move from the actuarial to the generational method of calculation
  • A one-off credit as of January 1, 2018, which for older insureds in particular will large-ly offset the reduction in the retirement pension as a result of the lower conversion rate
  • Higher savings contributions from January 1, 2018, which will significantly reduce the impact of the lower conversion rate on younger insureds, in particular.

Contact

Schindler Pension Fund
Zugerstrasse 13
6030 Ebikon

T. +41 41 445 3139
T. +41 41 445 3012

pk.ch@schindler.com