Ten years of the Riester pension scheme: No reason to celebrate

Artikel

Since their introduction, the Riester pension scheme and the individual Riester products have become less beneficial to savers. Contracts concluded today will often lead to lower returns compared to contracts concluded in 2001. From a social perspective, meaning pension benefits in relation to individual saving contributions plus state subsidy, overall returns on all insurance-based products are very low. This is due to the general decline in returns on the capital market and, in particular, to a series of government-mandated certification and calculation rules. Urgently needed structural reforms include the abolition of exchange costs, standardized cost information, certification with regards to content instead of formal certification and the regulation of calculation methods. In addition, limiting the number of products is also recommended. Given the shortcomings of the Riester system, there is good reason to fundamentally rethink old-age pension provision policy. In doing so, a targeted reduction or even elimination of extra public funding ought not to be taboo. The tax saved could be used to strengthen the pay-as-you-go state pension scheme.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Journal: DIW Economic Bulletin ; ISSN: 2192-7219 ; Volume: 2 ; Year: 2012 ; Issue: 2 ; Pages: 3-13 ; Berlin: Deutsches Institut für Wirtschaftsforschung (DIW)

Classification and Topics

• Classification: Wirtschaft ; Consumer Protection ; Asymmetric and Private Information; Mechanism Design ; Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making‡ ; Macroeconomics: Consumption; Saving; Wealth ; Social Security and Public Pensions
• Subject: private pension provision ; Riester scheme ; funding principle ; welfare state

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Hagen, Kornelia ; Kleinlein, Axel
• Event: Veröffentlichung
• (who): Deutsches Institut für Wirtschaftsforschung (DIW)
• (where): Berlin
• (when): 2012

Further information

• Handle: http://hdl.handle.net/10419/57983
• Last update: 10.03.2025, 11:43 AM CET