2021 was a very positive year in the capital market and for the new comprehensive pension funds, which manage more than half a trillion shekels for about 4 million members, this led to an average return of about 15%.
As every year, members are currently receiving the report for the 2021 summary and to understand what the report contains and why it is worth paying attention, we turned to Eyal Siani, a pension expert and VP of "Quality Financial Services".
Part A: Expected Payments
This section presents the amounts that will be received from the pension fund in cases of old age, disability and death.
The main meaning of the retirement age listed in the table is the age at which insurance for deaths and disabilities will be terminated.
If the age is 60, it can be changed to 67 so that the insurance coverage will protect you and your family up to this age.
The amount of insurance coverage for the disabled and survivors is not necessarily the maximum because it is affected by a variety of data, so it is important to check its amount and work to adjust it if possible.
Part B: Movements
Here is a general summary of financial data in the insured account, such as amounts of money deposited or withdrawn, the profits accrued in 2021, the management fees collected, the amounts we paid on the insurance coverage and more.
If you have no survivors, you can ask the pension fund to cancel the insurance because it is irrelevant.
The insurance costs you have saved will increase the amount of savings.
Part C: Management Fees and Expenses
This section details the rate of management fees collected from the insured's account, and the 'balloon' next to it shows the average management fee that the pension fund collects from all members.
Compare the rate of management fees you pay to average management fees.
The Capital Market Authority has selected four selected pension funds, which are obligated to offer each insured person who joins them a very reduced management fee of 1% of the deposit and another 0.22% of the accumulated savings for at least ten years.
Check how much you are paying and act accordingly.
Eyal Siani, Quality Financial Services,
Part D: Investment tracks and returns
Here is the rate of return achieved by the pension fund during the reporting period, for each route in which the funds were invested during the year. It is important to check where the savings are invested and whether the investment route suits your desires and needs. Another pension to preserve the rights.
Part E: Deposits to the Pension Fund
This section details the deposits in the insured's account in 2021, including the date of the deposit, the amount of the salary for which the funds were deposited and more.
Check that the amount of the deposits matches what is required and that the deposits are made continuously every month, by comparing the data on the pay slip.
Check whether the deposits are made for all the salary components, and if not - consider doing it independently to increase the scope of savings and insurance coverage.
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