Financial Services, Funds, Investments, Latvia, Pensioners

The number of participants of the private pension funds rose by 1.9%, or 4,851 people in the four months of 2016. At the end of April, 259,863 people were saving money in private pension funds.

Since the beginning of this year, the pension funds have been showing an average yield of 0.12%, according to the banking association. Balanced pension plans, following conservative investment policies, have been performing better as their yield has been averaging at 0.78% this year.

At present, there are six private pension funds (five open funds and one closed fund) in Latvia offering 15 various pension plans.

Latvia has a three-pillar pension system. The first-pillar pensions are paid to the existing pensioners from the social contributions made to the state budget. The second or government-funded pension level implies that part of the social contributions by employees is invested in the finance sector, ensuring them bigger pensions in the future. The third pillar is operated by private pension funds based on voluntary contributions.