As of this year, a far-reaching law directly affects participants in pension plans and Assured Pension Plans. The new provision makes it possible to withdraw, without justification and in the desired amount, the total amount contributed by the holders over 10 years and on the yields accumulated on their contribution. The rule applies equally, in a general way, to individual and employment plans, which means a change of protocol for these long-term savings products for retirement.
The measure generated controversy in the financial industry. On the one hand, the Inverco fund association and pension plan managers protested, arguing that it would undermine the very basis for the existence of these products, which was to serve as a long-term and stable tool to complement the public pension system. According to the data presented, the possibility of cashing in savings in just 10 years incentivizes short-termism and diminishes the savings that influence the economic stability of the retirement period.
However, many experts believe that this will not be a very serious problem. The best reference is the experience with the Entidades de Previsión Social Voluntaria in the Basque Country, where a new provision has been offering such a possibility for years. The data show that, for the most part, participants decide to keep their savings in the long term, despite their almost total access at any time.
On the one hand, the rule ensures greater freedom of their assets, but on the other hand, there is the difficulty of informing the holder about the long-term nature of their decisions. Whether the measure works will be crucial for the system as a whole.
Editorial office, January 22, 2025
