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20.10.2006

Austrians invest 153 euros a month in saving for their old age

  • 1.8 million Austrians have made no pension provision yet
  • BA-CA will now contribute 65 euros when a new VorsorgePlus pension is arranged
  • They will also raffle three life long private pensions

Providing for one's old age is becoming ever more important as a reason for saving. Those Austrians who invest in a private pension save, so they tell us, on average 153 euros per month towards their old age pension. This has emerged from a representative survey carried out by the opinion research institute FESSEL-GfK on behalf of Bank Austria Creditanstalt (BA-CA). Nevertheless some 1.8 million Austrians have not made any provision yet. BA-CA advises people to invest in a government subsidised pension plan as early as possible to bridge the pensions gap. BA-CA is promoting the plan by offering its own pension subsidy with immediate effect.

BA-CA will subsidise those willing to invest in their pensions by offering its own pension bonus with immediate effect and is also raffling three life long private pensions. Anybody who arranges a VorsorgePlus pension before the end of the year will receive a 65 euro pension bonus irrespective of the term or the level of contributions. Anybody who visits a BA-CA branch to discuss his/her pension requirements will be eligible to participate in the raffle.

A thirty year old with a monthly income of 2,000 euros has to expect a pension gap of around a third of his/her final salary. This difference can be cut in half with a VorsorgePlus pension entailing monthly savings of 172 euros. The VorsorgePlus pension is a version of the government subsidised pension scheme and offers an annual, government subsidy of between 8.5 and 13.5 per cent. The level of the subsidy will be reset every year. For 2006, the subsidy was set at 8.5 per cent and the maximum amount on which the subsidy was payable at 2,066 euros. The term may be determined individually and stands at between 15 and 25 years. Shorter terms of up to 11 years are also possible for late starters aged between 51 and 54.

At the end of the term the client may choose between extending the pension plan for a further period in which he/she will continue to receive a subsidy, a pension payment that is free of income tax from his/her 40th birthday at the earliest and a one-off payment. However, if he/she opts for the one-off payment, the earnings will be taxed retrospectively at 25 per cent and 50 per cent of the government subsidies received will have to be repaid. The capital contributions and the government subsidies are guaranteed if the private pension is drawn. The VorsorgePlus pension is available for as little as 30 euros a month. Your capital is also guaranteed in the event of your death and, if you wish, to can take out an insurance policy to ensure contributions continue to be paid if you are unable to work for a long period.

The pension gap calculator on the BA-CA website allows you to work out how large the difference is between your final salary and your pension.

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Enquiries: Bank Austria Creditanstalt Austrian Press Office
Tiemon Kiesenhofer, Tel. +43 (0)5 05 05 ext. 52819
E-mail: tiemon.kiesenhofer@ba-ca.com