What Makes A Secure Retirement Savings?

When you put aside for retirement, it is particularly important for safety, because this money is not there to. But it is not only necessary to eliminate the risk of investment, there are many other factors also pose a risk for such a long term. We gathered the seven aspects that you should consider when looking for the best retirement savings.

Previously we have often written for retirement savings on . We always emphasized the particularly low costs and an appropriate risk-return ratio and also have written to everyone when associated with a 20% tax relief. Now let us examine the issue solely in terms of security, since the broker after the scandals have shaken the confidence of many financial institutions.

We have seen that if badly chosen provider, it is certainly a very big fall off unnecessarily. However, the pension assets set aside in any case not play money!

7 safety factor when you choose retirement savings

1. Regulatory environment:

Especially in relation to tax relief, and voluntary pension funds, and on NYESZ bills to pay attention to this. The last time these regulations have changed several times, and never benefit. Now back in the air limit the uptake of the voluntary pension fund savings that can stand up to it after retirement only in the form of annuity. That is not to gain access to the only in installments.

Do not underestimate these risks, especially if you do not have a 5-10 year, but a year after, say, 20-25. Just look back, what was the legal / political environment 25 years ago. Quite a few things have changed since then. It may increase the retirement age, cease the tax benefit, restrict access, can close loopholes. (NYESZ -> TBSZ, Self-Help -> Voluntary pension modifications for example.)

2. Safe Yield and Investment:

Everyone would like to secure high returns, but it is impossible request. Tőkédnek should also risk the higher the yield expectations, the greater part. If you had a super investment that offers higher yields lower risk, you can invest into everyone Do not fall for the tales that speak to the 15% annual yields.. If you get already 8-9% in a year, you can put two hands together.

What Makes A Secure Retirement Savings?

Possible to achieve a high yield, but just in the short term is very risky to invest in such instruments in the short term. As fluctuating exchange rates can make changes to your will just have to when it is in the bottom of the slope. The longer the distance, the more time you have the chance, and that, overall, a more risky investment can also get off benefits.

For example, you can control risk within the portfolio of bond / equity ratios. Less than 5 years term does not hold shares in the 20-year term, up to 75% of the portfolio may be limited. All this of course should be set according own risk. If this Kernel for our help, you know in a personal pension advice to ask.

3. Size of Financial Institutions:

Maybe it does not have too much stress after the broker scandals that are worth less than the minimum reservation handle mostly Hungarian-owned brokerage firms. Not only because they reveal the underlying, but also because such long-term even a fair company is not sure that he can stay reserved.

It has a large pension banking / insurance background and long history, strong capital firm to choose. The voluntary funds can be risky because of the legal changes mentioned above, but only in terms of size may be larger than capable of saving small amounts. It is half a sentence devoted to the insurers, who with the gigantic size of these aspects of the safest standard. For example, Allianz has 29 OTP sized property.

4. Guarantees (public, OBA, Bevan Insurance):

What does the guaranteed return? Who guarantees? It's a bond that guarantees the OTP to repay is not too strong guarantee if you go bankrupt the OTP. This is also the case for the Quaestor. It is no matter whether it guarantees a given investment. The financial institution? The state? NETA is subject to some kind of guarantee of investor protection fund?

The state guarantee covers such as government bonds. This provides a strong guarantee. Just think about it, it was not enough scandals in the brokerage assets of the BEVA compensation and without having to change many of the rules have been only a very small part of compensation. In this case, the state can intervene to intervene, as it has a much larger margin than a salvage fund.

The same is true for insurers who possess enormous wealth so his warranty stronger than a small Hungarian funds. Even if he goes bankrupt an insurer, they can also have other insurers, who in turn provide, so in this case and the other is to ensure the correctness engagements. While during a major crisis hundreds of banks go bankrupt insurers are such a vulnerable position rarely and in special cases.

5. Flexibility:

Not only the retirement savings you should be safe, but the facility itself. That is, not all savings is as safe for everyone. Let me give you an example. If you have an emergency reserve and certain expertise, high-paying job, it does not matter if HUF 40,000 per month 10-20 years, it will probably never be a situation where you could not pay for this case, enough flexibility in it if, say, you can pause, where appropriate, the savings one year.

However, if you live month to month, precarious jobs, you must keep in addition to health problems, then you'd better choose other types of construction. In this case, you should keep in mind the flexibility - and at least a portion of the savings - so invested as to be available quickly and without loss in the short term as well. If you do not, you may think you can risk life insurance conclusion.

It is separated from the actual risk insurance for the pension saving reality. These are two separate things: either is one, while another will be the ideal product to another, so you come out a better binding of the two contracts for two purposes. Do not fall for the agent who wants to sell both. A product, it does not necessarily match the interests with yours.

6. Costs:

Although not a risk is unpredictable, but this is the biggest mistake that most people commit. If you do not have a precise and detailed examination of the cost savings, you are not only risking the loss, but also promising. It's not all the same, to 8% of the proceeds in investments made ​​individually 1% of the cost, or 4%. In the long term it comes million, making it one of the most important aspects when bills must be selected.

The money market is not true that the more expensive is better, on the contrary. Nothing proves this better than the professional investors into low-cost products (e.g. ETFs into) investing.

7. Transparency:

Any financial product it is true that under do not write anything you do not understand fully. Mainly loans and investments true: that the clerk did not tell me anything. It is very easy to play with words, easy half-truths in addition to narrate costs or risks. If you do not understand it, then do not sign the contract.

If you know what you have written down, and do not be afraid when you get to the first account statement and notice that only half of your deposit located on it. In retrospect, you will not be able to know what to do, especially in case of non-pension savings. This is one of the biggest financial decision of your life, so it is important to be 110% of the image.

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