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Monday, April 12, 2021

ZUS or IKE? Marek Belka advises what to do with money after the transformation of open pension funds

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There are quite transparent indexation rules in ZUS. It has never happened that the Social Insurance Institution did not pay any benefit on time – this is how Marek Belka, former prime minister, former NBP president, explained in TVN24 in “Fakty po Faktach”, why he advises to transfer his money after the transformation of open pension funds planned by the current authorities to the Social Insurance Institution, and not to an individual retirement account.

On Tuesday, the government adopted a bill on the transformation of open pension funds. The act would enter into force on June 1, 2021. The time for submitting a declaration on the transfer of funds from OFE to ZUS is to be from June 1 to August 2. The government wants accounts in Open Pension Funds to be converted into individual retirement accounts (IKE), but this change in legal form would cost future pensioners 15 percent. collected funds (the so-called transformation fee). An alternative would be to direct funds to ZUS after the OFE member submits an appropriate declaration. Then there is no conversion fee, but the right to inherit these funds is forfeited.


ZUS or IKE? Belka has no doubts

Former prime minister, former president of the NBP, MEP Marek Belka in “Fakty po Faktach” on TVN24 was asked what choice he would advise: ZUS or IKE. – ZUS – Belka replied decisively.

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– Even though everyone complains about the Social Insurance Institution. But in ZUS there are quite transparent indexation rules. It has never happened that ZUS has not paid any pension or any other benefit on time – he said.

He cited an analysis carried out by Paweł Tomaszewski, who, as Belka said, was the chief economist of the Social Insurance Institution for some time. – He analyzed the dismantling of OFE in the times of Minister (Jacek) Rostowski (former head of the Ministry of Finance – ed.) And compared it with the final dismantling that is taking place now – said Belka.

– Well, as one of the few analysts, he admitted that, yes, that operation was aimed at preventing a fiscal crisis, while from the point of view of individual future pensioners it was beneficial, because the rate of returns in ZUS on individual retirement accounts was much higher than the one that Open Pension Funds could be achieved – added the former prime minister.

Main photo source: TVN24

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