In Search of the Optimal Saving Strategy for Pan-European Pension Products

The introduction of pan-European pension products in 2020 is associated with an ongoing debate on prescribing predefined saving strategy that would both deliver adequate performance and limit the down-side risk at the end of the saving horizon. Dynamic life-cycle saving strategies are generally accepted as a good risk-mitigation tool that can be individually set. Many research papers confirm the ability of life-cycle strategies to deliver high risk-reward outcomes. Objective of our paper is to test the ability of one-factor life-cycle saving strategies based on the age and/or the remaining saving horizon to deliver the promised value for PEPP savers. We constructed 18 saving strategies divided into three groups – static saving strategies with fixed proportion of equities, dynamic life-cycle strategies based on the age and/or remaining saving horizon, and quasi-active strategies combining two factors – the remaining saving horizon and price movement. We employed the model based on moving-block bootstrapping technique and performed simulations for various economic conditions. We have tested the expected saving performance combined with the down-side risk during the saving horizon. Our findings do not confirm the general findings on life-cycle saving strategies. We claim that having the age as the only factor defining the proportion of equities in the pension saving portfolio would not be optimal. However, we found that two-factor saving strategies look promising in delivering both lower down-side risk and higher performance over the saving horizon

What is the cost of pension reform reversal in Slovakia and could the NDC scheme solve the fiscal imbalance of payg scheme?

In this study, by applying microsimulation pension model supported by statistical and administrative data on Slovak population, we analyze the fiscal and redistributive consequences of retirement age ceiling and impact of NDC scheme introduction on the Slovak pay-as-you-go pillar fiscal balance and expected pension benefits. However, we work with some limitations on the NDC set-up according to the preferences defined by the governmental institutions. The paper is organized as follows: The second section discusses current knowledge and existing papers dealing with pension reform, reform reversals supported by rising pension populism and existing experience with the introduction of NDC schemes. Third section presents more details on Slovak pension system and elaborates details on the research objective, data, and methodology with the presentation of no-policy change set-up as well as NDC scheme set-up. Fourth section presents the research results of the fiscal and redistribution implications of the policies examined and discusses the findings and potential challenges that need to be further elaborated if the NDC scheme should be implemented, especially the poverty risk for low-income cohorts and minimum retirement income granted to a retiring person regardless the level of paid contributions

A look into the education of seniors of the Third Age University at KTIT

Celoživotné vzdelávanie je programom dnešnej doby a cieľom vzdelávacích inštitúcií je vytvárať a inovovať obsahy vzdelávania seniorom študujúcim na UTV. Príspevok približujemoderné formyvzdelávania seniorov s využitím e-learningu, VRE a sociálnych sietí. Študenti univerzity tretieho veku v programe IKT strácajú zábrany a aktívne využívajú prostriedky modernej doby k zlepšeniu svojej kvality života.Lifelong learning is a program of today and the aim of educational institutions is to create and upgrade the contents of education of seniors studying at the UTV. The report describes the modern forms of education of seniors using e-learning, RCE and social networks. Students of the Third Age University of the ICT Program lose their inhibitions and actively use the means of modern times to improve their quality of life

Indicators welfare of senior citizens studying at University of Third Age

Na katedre techniky a informačných technológií UKF v Nitre sa dlhoročne venujeme vzdelávaniu seniorov. Katedra otvorila niekoľko vzdelávacích programov pre seniorov. Medzi najpopulárnejšie patrí program Digitálna fotografia a kamera, Informačné technológie a Ľudové remeslá. Všetky programy už viac ako 10 rokov vedú rovnakí lektori. Lektori pri vzdelávaní seniorov dlhodobo sledovali ich motiváciu, prečo sa prihlásili študovať na univerzitu tretieho veku (U3V) a čo ich viedlo k výberu vzdelávacieho odboru, ale najmä, čo im dáva a čo pre nich znamená vzdelávanie na univerzite tretieho veku. Na základe týchto pozorovaní a analýz rozhovorov sme sa rozhodli podrobnejšie spracovať niektoré indikátory a potreby seniorov študujúcich na U3V. K analýze indikátorov kvality života seniorov sme použili neštandardizovaný dotazník, ktorý obsahoval 45 položiek. Dotazník tvorila kombinácia otvorených a uzatvorených položiek.We have worked on the education of seniors for many years at the Department of Technology and Information Technology University in Nitra. The department launched several training pro-grams for seniors. Folk Crafts, Digital photo and video camera and Information technologies are included among the most popular. All subjects are led by the same teachers since their beginnings. Lecturers long observed during the training the motivation why seniors signed up to study at the University of the Third Age (U3A), what led them to choose the correct education program, what is it giving them and what does education mean for them at this University of the Third Age. Based on these observations and analyzes of conversations, we decided to further analyze some of the needs and preferences of seniors studying at U3A. The analysis of indicators of quality of life of the seniors, we used a non-standardized questionnaire containing 45 questions. The question-naire consisted of a combination of opened and closed questions

Fiscal and redistributive impacts of the introduction of dynamic components in maternity benefits

Research background: Social security systems combine several subsystems aimed at addressing the risks of temporary or permanent loss of an individual's income. The subject of the research are parametric changes of alternative public policy aimed at addressing the temporary loss of income caused by the dropout from the labour market due to childcare. The effects of public policies may be fiscally neutral from the entire system, but not from the point of view of the individual. Purpose of the article: The purpose of this study is to examine the fiscal and redistributive effects of parametric changes in social insurance subsystem with an accent on maternity benefits in the conditions of the Slovak Republic by using a modified microsimulation model. Methods: Using a microsimulation model, we investigate the impacts of the alternative policy setting. Microsimulation model contains four basic modules (i) macroeconomic module, (ii) demographic module simulating future population structure from 2017 to 2080 (iii) status module modelling particular attributes (characteristics), (iv) social policy module. The model is applied to maternity benefits in two scenarios in the Slovak Republic: scenario 1 ? the current legislative setting of maternity benefit policy parameters and scenario 2 ? dynamic maternity benefit. Findings & value added: Results in the area of redistributive impacts in social insurance focused on maternity benefits show that dynamic policy parameters can positively affect work-life balance, especially for individuals with higher education. The results in the area of fiscal impacts show that the dynamic model of maternity benefits increases the efficiency of public spending and stimulates the faster return on the labour market. The results indicate the direction of possible government interventions and provide valuable information for policy makers in areas public policies that are associated with temporary labour market dropouts in the case of maternity

Impact of different life-cycle saving strategies and unemployment on individual savings in defined contribution pension scheme in Slovakia

Searching for the optimal saving strategy is often tied with the life-cycle strategies where only the age of a saver is considered for setting the allocation profile between equities and bonds. Our article contributes to the debate by looking at the performance and adequacy risks arising from applying age-based saving strategies for savers in funded pension schemes.As many studies have proven the shift of the risk onto savers in defined contribution pension schemes under various saving strategies, we contribute to the debate by providing simulations of expected accumulated savings via funded pension scheme under the various life-cycle income profiles and existence of unemployment risk. Using the resampling simulation technique, we compare the fixed and age-based strategies of three different agents with various life-cycle income paths and different unemployment risk. We compare the expected amount of savings and calculate relative indicators comparing the expected monthly benefits, income replacement rate. We look closely on the impact of unemployment on the value of savings and calculate the unemployment factor explaining the value of savings lost due to the periods of unemployment. By combining life-cycle income functions of individuals with different education level and unemployment risk, we show that decisions of implementing low risk saving strategies are suboptimal and lead to a substantial decrease in replacement ratios not only for higher income cohorts but especially for the lowest ones. At the same time, we prove that employing low risk saving strategy leads to the increase of adequacy risk especially driven by the unemployment risk that is higher for lower education individuals. We conclude that age-based life-cycle saving strategies, where the remaining saving horizon is the only factor defining the allocation profile is not the optimal saving strategy and other factors should be considered as well when searching for optimal saving strategy