Interest declined in third quarter
''When interest rates are low, the funding ratio declines''
How will your pension develop in 2025? Will we be able to increase your pension to keep up with inflation? And will the 30.5% pension contribution be sufficient to ensure your pension accrues at the maximum level allowed?
A lot depends on the interest rates that pension funds apply to calculate the amount they need to keep in cash now (‘cash value’) in order to meet their 30-year commitments in the future. By the end of the third quarter, the 30-year rate had declined from 2.5% to 2.2%.
High interest rates are beneficial to your pension. This is because the cash value of the commitments decreases more than the losses incurred on bonds. The net effect is that the funding ratio rises, which means we can increase your pension.
The opposite is the case when interest rates are low. In that situation, indexation and accrual of your pension are under pressure. At the beginning of 2025, we will be able to tell you more about this.
This Newsflash has been carefully prepared. The final figures for 2024 will be published in the anual report. You cannot derive any any rights from this report.