3rd Pillar Pensions
3rd Pillar Pension scheme provides an opportunity to make voluntary savings for old age. In addition to the government guaranteed pension, you can make contributions yourself or through your employer. 3rd Pillar Pension assets are accumulated in the pension plans of a private pension fund and invested in the financial markets.
Why is it beneficial to save using the 3rd Pillar Pension plans:
- Resident income tax breaks the contribution amount if it does not exceed 10 % of the annual gross wage (together with life insurance savings premia) and does not exceed 4 000 euro.
- Amount and frequency of contributions is not limited.
- Possibility to invest in one or both pension plans.
- Possibility to access the accumulated assets upon reaching the age of 55.
- Assets accumulated in 3rd Pillar Pension scheme are inheritable.
To start saving in Pension Fund:
- Apply for 3rd Pillar Pension scheme at any Customer Service Unit.
- Make a transfer to the account specified in the agreement; indicate your individual membership agreement number.
- Create a standing order for not to forget to make the pension contributions.
Luminor 3rd Pillar Pension plans are administered by Luminor Latvia Open Pension Fund (Latvijas atklātais pensiju fonds), reg. No. 40103331798, Krišjāņa Valdemāra street 62, Rīga, LV-1013, managed by Luminor Pensions Latvia IPAS, Krišjāņa Valdemāra street 62, Rīga, LV-1013. Assets custodian bank is Luminor Bank AS
- Up to 75% of the assets are invested into equities, namely – stocks and other similar means of investment. The remainder will be invested in fixed-income financial instruments: bonds, deposits of credit institutions.
- Such investment strategy is suitable for the individuals who expect potentially high return and can accept significant asset fluctuations. This is a pension plan with very dynamic investment strategy.
Balanced Pension Plan:
- Up to 25% of the assets are invested into equities, namely – stocks and other similar means of investment. The remainder will be invested in fixed-income financial instruments: bonds, deposits of credit institutions.
- This investment strategy is suited to individuals, who are looking for relatively safe and stable, but modest return.