II pillar

LHV funds are no 1 in accruing pension since 2002¹

As retirement age approaches, the pension fund should involve lower risk. When choosing your second pension pillar, keep in mind two important things:

  • how much time you have left until retirement
  • what level of risk you are willing to take

II pillar funds

LHV Pensionifond XS – The safest choice

Suitable if

  • you have less than 3 years left until retirement,
  • you have low risk tolerance,
  • your aim is to preserve your savings and avoid losses.
Join the fund
Strategy

We invest the money into the bonds of various governments and their affiliated organisations. They offer the greatest stability and the lowest risks. There is no stock market risk. The money accumulated for your pension remains stable.

Rate of return

From the beginning / Current year / Current month

Expenses

Entry fee 0% / Exit fee 0% / Management fee 0.576%

Information about the fund

Volume of the fund (as of 28.02.2019)20,383,858.34 €

Price of a unit

Management companyLHV Varahaldus

Equity in the fund80 000 units

Rate of the depository’s charge0.0588% (paid by LHV)

DepositoryAS SEB Pank

We will allocate your money into international enterprises, the development of which we believe in. At the same time, it must be taken into consideration that the future of these enterprises depends on both their internal decisions as well as the changes in the global economy.

The data is presented as at 28.02.2019.

Biggest investments
France 05/20275.64%
Germany 09/20224.75%
Czech Republic 05/20224.54%
Temasek Financial 03/20224.33%
Riigi Kinnisvara 06/20273.94%
Transpordi Varahaldus 04/20253.91%
Slovakia 11/20243.86%
United States 08/20192.99%
Bank Gospodarstwa Krajow 06/20252.55%
Stedin Holding 10/20222.54%
Current asset allocation
Money and deposits27.79%
Government bonds30.44%
Corporate bonds41.77%
Regional distribution
Money and deposits27.79%
The Baltic states27.97%
Europe (excl. the Baltic states)28.57%
Asia8.39%
North America2.99%
Other4.29%

Investment into a Finnish energy giant was added to the fund portfolio

Romet Enok, Fund Manager

Government bonds remained slightly on the minus side in Europe in February, but compared to the beginning of the year, the market is still on the plus side by more than half a per cent. The prices of German government bonds have increased again and the expected rate of return has reached the lowest level since 2016. Although the ten year bond has not yet regained its negative expected rate of return, it was not too far away in February. The forecasts on both economic growth and price increases have been reduced and the hope of a continuing growth rate of Europe’s economy is gone. As a measure to support the economy, the European Central Bank once again announced some loan programmes for the banks of the currency union at the beginning of March. In such a situation, the fund provided a small positive rate of return in February and also in comparison with the beginning of the year. Among new investments, the portfolio received an addition in the form of securities of the Finnish national energy group Fortum.

The type of disbursement depends on how much you have accumulated in the fund. The type of payments can be predicted with the concept of the national pension rate, the sum of which is established on the basis of an annually set index. Since April 2018 the sum is 189.31 €.

How can the funds be withdrawn from the second pillar?

See video

Pension agreement: when more than 50 times the national pension rate has been accumulated

The main option of withdrawing the money accumulated in the 2nd pillar fund is to conclude a pension agreement. This means that upon retirement you conclude an agreement with a life insurance company, handing the funds accumulated in the pension fund over to the disposal of the company. In return, the insurance company will pay you a regular pension until the end of your life. This is important information, as insurance companies are making estimations about the duration of the pension age and calculate the sum of the disbursements made to you. If you live a healthy life and to an old age, the insurance company will make payments to you in a larger amount than the one accumulated in the fund. Otherwise, the insurance company keeps some of the money and uses it to make payments to clients who live to an older age.

Funded pension: when up to 50 times the national pension rate has been accumulated

When up to 9465 € has been accumulated in the pension account, the money can be used with periodical payments from the pension fund. For this, an application must be filled in at a bank office or the online bank. In your application, notify the bank of the desired period of the payments and the total duration of the pension payments. How short the period can be is determined by the Funded Pensions Act and depends on the age of the pensioner. Unlike an insurance company, which pays you a pension for the rest of your life, payments from the pension fund are only made as long as there is money on your account. On the other hand, all of the assets in the fund belong to the recipient of the pension, and when they pass away, they are transferred to their heirs.

In a lump sum: when up to 10 times the national pension rate has been accumulated

Money can be withdrawn from the 2nd pension pillar in a lump sum, when less than 1893 € have been accumulated in the pension fund.

Bequeathing

The assets of the pension fund can be bequeathed. Heirs are free to choose whether to withdraw the amount at once or to inherit fund shares. An income tax of 20% applies to the cash payments.

Taxes

An income tax of 20% applies to the payments from the pension fund. The income tax calculation is based on the tax exemption to the monthly income of a pensioner, which in 2018 is 500 €.

LHV Pensionifond S – A safe choice

Suitable if

  • you have less than 3 years left until retirement,
  • you have low risk tolerance,
  • your aim is the preservation and modest growth of your pension savings.
Join the fund
Strategy

We invest your money into strong corporate bonds. They offer stability in the maintenance of your money and are not affected as much by the prevalent economic situation as corporate shares. There is no stock market risk. The growth of your pension savings is limited, but will be stable.

Rate of return

From the beginning / Current year / Current month

Expenses

Entry fee 0% / Exit fee 0% / Management fee 0.672%

Information about the fund

Volume of the fund (as of 28.02.2019)57,930,401.80 €

Price of a unit

Management companyLHV Varahaldus

Equity in the fund200 000 units

Rate of the depository’s charge0.0588% (paid by LHV)

DepositoryAS SEB Pank

We will allocate your money into international enterprises, the development of which we believe in. At the same time, it must be taken into consideration that the future of these enterprises depends on both their internal decisions as well as the changes in the global economy.

The data is presented as at 28.02.2019.

Biggest investments
Temasek Financial 03/20224.62%
Latvenergo 06/20224.53%
Transpordi Varahaldus 04/20254.35%
Luminor Bank 10/20214.33%
Riigi Kinnisvara 06/20274.15%
Investor 05/20233.52%
Total Capital Intl 03/20203.12%
France 10/20222.83%
Romania 10/20242.83%
Sanofi 09/20202.68%
Current asset allocation
Money and deposits8.92%
Government bonds17.59%
Corporate bonds73.51%
Regional distribution
Money and deposits8.92%
The Baltic states27.43%
Europe (excl. the Baltic states)42.84%
Asia7.00%
North America11.11%
Other2.72%

The fund continues with positive results

Romet Enok, Fund Manager

Unlike government bonds, corporate securities continued to achieve a strong result in Europe in February as well. A clear tendency could be observed - the lower the credit quality, the faster the price increase. The trend we could see at the beginning of the year, having new public bond issues in big volumes, also continued. All of this took place in a situation in which the European Central Bank decided to inform the market of imminent new loan programmes to eurozone banks in the light of the lowered growth forecasts. In this situation, pension fund S has shown a small positive result both in January and in February. We currently assess the credit market outlook as being on the weak side, and thus we are not acquiring new investments in significant volume. For liquidity management, we purchased securities of the Finnish national energy group Fortum last month.

The type of disbursement depends on how much you have accumulated in the fund. The type of payments can be predicted with the concept of the national pension rate, the sum of which is established on the basis of an annually set index. Since April 2018 the sum is 189.31 €.

How can the funds be withdrawn from the second pillar?

See video

Pension agreement: when more than 50 times the national pension rate has been accumulated

The main option of withdrawing the money accumulated in the 2nd pillar fund is to conclude a pension agreement. This means that upon retirement you conclude an agreement with a life insurance company, handing the funds accumulated in the pension fund over to the disposal of the company. In return, the insurance company will pay you a regular pension until the end of your life. This is important information, as insurance companies are making estimations about the duration of the pension age and calculate the sum of the disbursements made to you. If you live a healthy life and to an old age, the insurance company will make payments to you in a larger amount than the one accumulated in the fund. Otherwise, the insurance company keeps some of the money and uses it to make payments to clients who live to an older age.

Funded pension: when up to 50 times the national pension rate has been accumulated

When up to 9465 € has been accumulated in the pension account, the money can be used with periodical payments from the pension fund. For this, an application must be filled in at a bank office or the online bank. In your application, notify the bank of the desired period of the payments and the total duration of the pension payments. How short the period can be is determined by the Funded Pensions Act and depends on the age of the pensioner. Unlike an insurance company, which pays you a pension for the rest of your life, payments from the pension fund are only made as long as there is money on your account. On the other hand, all of the assets in the fund belong to the recipient of the pension, and when they pass away, they are transferred to their heirs.

In a lump sum: when up to 10 times the national pension rate has been accumulated

Money can be withdrawn from the 2nd pension pillar in a lump sum, when less than 1893 € have been accumulated in the pension fund.

Bequeathing

The assets of the pension fund can be bequeathed. Heirs are free to choose whether to withdraw the amount at once or to inherit fund shares. An income tax of 20% applies to the cash payments.

Taxes

An income tax of 20% applies to the payments from the pension fund. The income tax calculation is based on the tax exemption to the monthly income of a pensioner, which in 2018 is 500 €.

LHV Pensionifond M - A balanced choice

Suitable if

  • you have more than 3–10 years left until retirement age,
  • you have moderate risk tolerance
  • the aim is the long-term stable growth of your pension savings.
Join the fund
Strategy

We allocate most of the funds into bonds, which offer stability when it comes to the preservation of your money. For added balance, we also invest into real estate and enterprises to allow for stable growth by your pension savings. Up to 25% of the fund’s assets will be allocated to shares, that is, holdings in companies will be acquired. We invest the rest into bonds and real estate.

Rate of return

From the beginning / Current year / Current month

Expenses

Entry fee 0% / Exit fee 0% / Management fee 0.96%

Information about the fund

Volume of the fund (as of 28.02.2019)118,250,455.53 €

Price of a unit

Management companyLHV Varahaldus

Equity in the fund400 000 units

Rate of the depository’s charge0.0588% (paid by LHV)

DepositoryAS SEB Pank

We will allocate your money into international enterprises, the development of which we believe in. At the same time, it must be taken into consideration that the future of these enterprises depends on both their internal decisions as well as the changes in the global economy.

The data is presented as at 28.02.2019.

Biggest investments
Luminor Bank 10/20213.89%
EfTEN Kinnisvarafond3.71%
Riigi Kinnisvara 06/20273.22%
France 10/20222.73%
Transpordi Varahaldus 04/20252.73%
Berkshire Hathaway 01/20212.67%
Tartu Linnavalitsus 10/20322.18%
JP Morgan Chase 01/20202.11%
Coop Pank 12/20271.97%
Latvenergo 06/20221.93%
Current asset allocation
Money and deposits2.79%
Government bonds10.82%
Corporate bonds70.30%
Real estate7.74%
Shares8.32%
Regional distribution
Money and deposits2.79%
The Baltic states48.98%
Europe (excl. the Baltic states)32.09%
Asia2.64%
North America13.42%
Other0.05%

Calm month on stock and bond markets

Romet Enok, Fund Manager

February was relatively relaxed on the world’s stock markets. The stock market indexes of developed countries were mainly on the rise, e.g. the index containing Europe’s 50 largest publicly traded companies increased by 4.4% in the month. In February, the Japanese stock market index increased by 2.9% measured in local currency and by 1.2% measured in euros. The stock market indexes of Riga and Vilnius remained at the level of the last month, rising by 0.3% and 0.6% respectively. Tallinn stock exchange, however, dropped by 1.7% in February, largely due to the weak results of Q4 by the shipping company Tallink, leading to a 5.1% drop in its shares. The company’s income decreased by 2.7% compared to Q4 of 2017 and suffered a 1.1 million euro loss. The number of passengers decreased by 3.3% in Q4 but remained the same overall in 2018. On the other hand, Tallink plans to pay out dividends of 5 cents per share and reduce the share capital by 7 cents per share, making the rate of return of the disbursements more than 11%.

At the beginning of March, the European Central Bank decided to inform the market of imminent new loan programmes to banks of the euro zone. The growth estimates of the European economy have already been lowered in February and the longer term government bonds of Germany were not far from the price level in which the future expected rate of return would be on the negative side again. As a counterbalance, the prices of corporate bonds increased both on the markets of the stronger and especially the weaker issuers. Companies also loaned out record volumes of new money by issuing new bonds. The bond portfolios of our funds are mostly based on external instruments of the financial market and this is also the direction that we hope to use for future additions. The outlooks of the international credit market are on the weaker side according to our assessments.

The type of disbursement depends on how much you have accumulated in the fund. The type of payments can be predicted with the concept of the national pension rate, the sum of which is established on the basis of an annually set index. Since April 2018 the sum is 189.31 €.

How can the funds be withdrawn from the second pillar?

See video

Pension agreement: when more than 50 times the national pension rate has been accumulated

The main option of withdrawing the money accumulated in the 2nd pillar fund is to conclude a pension agreement. This means that upon retirement you conclude an agreement with a life insurance company, handing the funds accumulated in the pension fund over to the disposal of the company. In return, the insurance company will pay you a regular pension until the end of your life. This is important information, as insurance companies are making estimations about the duration of the pension age and calculate the sum of the disbursements made to you. If you live a healthy life and to an old age, the insurance company will make payments to you in a larger amount than the one accumulated in the fund. Otherwise, the insurance company keeps some of the money and uses it to make payments to clients who live to an older age.

Funded pension: when up to 50 times the national pension rate has been accumulated

When up to 9465 € has been accumulated in the pension account, the money can be used with periodical payments from the pension fund. For this, an application must be filled in at a bank office or the online bank. In your application, notify the bank of the desired period of the payments and the total duration of the pension payments. How short the period can be is determined by the Funded Pensions Act and depends on the age of the pensioner. Unlike an insurance company, which pays you a pension for the rest of your life, payments from the pension fund are only made as long as there is money on your account. On the other hand, all of the assets in the fund belong to the recipient of the pension, and when they pass away, they are transferred to their heirs.

In a lump sum: when up to 10 times the national pension rate has been accumulated

Money can be withdrawn from the 2nd pension pillar in a lump sum, when less than 1893 € have been accumulated in the pension fund.

Bequeathing

The assets of the pension fund can be bequeathed. Heirs are free to choose whether to withdraw the amount at once or to inherit fund shares. An income tax of 20% applies to the cash payments.

Taxes

An income tax of 20% applies to the payments from the pension fund. The income tax calculation is based on the tax exemption to the monthly income of a pensioner, which in 2018 is 500 €.

LHV Pensionifond L – LHV’s flagship

Suitable if

  • you have more than 10 years left until retirement,
  • you have average risk tolerance
  • the aim is the long-term growth of your pension savings.
Join the fund
Strategy

We invest in different areas, the development of which we believe in (e.g. real estate, forest, private equity, Baltic shares, international stock markets and bonds). We allocate up to 50% of the fund’s assets onto stock markets, obtaining holdings in companies. We invest the rest into bonds and real estate.

Rate of return

From the beginning / Current year / Current month

Expenses

Entry fee 0% / Exit fee 0% / Management fee 1.20%

Information about the fund

Volume of the fund (as of 28.02.2019)832,649,025.01 €

Price of a unit

Management companyLHV Varahaldus

Equity in the fund2 200 000 units

Rate of the depository’s charge0.0588% (paid by LHV)

DepositoryAS SEB Pank

We will allocate your money into international enterprises, the development of which we believe in. At the same time, it must be taken into consideration that the future of these enterprises depends on both their internal decisions as well as the changes in the global economy.

The data is presented as at 28.02.2019.

Biggest investments
EfTEN Kinnisvarafond4.54%
Luminor Bank 10/20213.94%
Riigi Kinnisvara 06/20273.75%
France 10/20223.07%
Latvia 01/20212.51%
JP Morgan Chase 08/20212.09%
Siauliu Bankas 12/20201.92%
East Capital Baltic Property Fund III1.81%
China Development Bank 11/20211.77%
Baltic Horizon Fund 05/20231.73%
Current asset allocation
Money and deposits2.23%
Government bonds14.07%
Corporate bonds52.05%
Real estate10.39%
Shares21.21%
Regional distribution
Money and deposits2.23%
The Baltic states51.74%
Europe (excl. the Baltic states)31.11%
Asia4.09%
North America10.65%
Other0.13%

The fund invested in the largest private equity fund in the Baltics

Kristo Oidermaa, Fund Manager

February was relatively relaxed on the world’s stock markets. The stock market indexes of developed countries were mainly on the rise, e.g. the index containing Europe’s 50 largest publicly traded companies increased by 4.4% in the month. In February, the Japanese stock market index increased by 2.9% measured in local currency and by 1.2% measured in euros. The stock market indexes of Riga and Vilnius remained at the level of the last month, rising by 0.3% and 0.6% respectively. However, the Tallinn stock exchange dropped by 1.7% in February. Pension fund L made a new investment in the Lithuanian private equity fund INVL Baltic Sea Growth Fund, which invests in medium-sized Baltic companies with good growth potential. This is currently the largest private equity fund in the Baltics, gathering more than 100 million euros from its investors. By now, the fund has also made its first investment, which is the InMedica medical institution chain in Lithuania. The company operates a total of 18 clinics that provide, for instance, services of family doctors, specialised doctors and dentists.

At the beginning of March, the European Central Bank decided to inform the market of imminent new loan programmes to banks of the euro zone. The growth estimates of the European economy have already been lowered in February and the longer term government bonds of Germany were not far from the price level in which the future expected rate of return would be on the negative side again. As a counterbalance, the prices of corporate bonds increased both on the markets of the stronger and especially of the weaker issuers. Companies also loaned out record volumes of new money by issuing new bonds. The bond portfolios of our funds are mostly based on external instruments of the financial market and this is also the direction that we hope to use for future additions. The outlooks of the international credit market are on the weaker side according to our assessments.

The type of disbursement depends on how much you have accumulated in the fund. The type of payments can be predicted with the concept of the national pension rate, the sum of which is established on the basis of an annually set index. Since April 2018 the sum is 189.31 €.

How can the funds be withdrawn from the second pillar?

See video

Pension agreement: when more than 50 times the national pension rate has been accumulated

The main option of withdrawing the money accumulated in the 2nd pillar fund is to conclude a pension agreement. This means that upon retirement you conclude an agreement with a life insurance company, handing the funds accumulated in the pension fund over to the disposal of the company. In return, the insurance company will pay you a regular pension until the end of your life. This is important information, as insurance companies are making estimations about the duration of the pension age and calculate the sum of the disbursements made to you. If you live a healthy life and to an old age, the insurance company will make payments to you in a larger amount than the one accumulated in the fund. Otherwise, the insurance company keeps some of the money and uses it to make payments to clients who live to an older age.

Funded pension: when up to 50 times the national pension rate has been accumulated

When up to 9465 € has been accumulated in the pension account, the money can be used with periodical payments from the pension fund. For this, an application must be filled in at a bank office or the online bank. In your application, notify the bank of the desired period of the payments and the total duration of the pension payments. How short the period can be is determined by the Funded Pensions Act and depends on the age of the pensioner. Unlike an insurance company, which pays you a pension for the rest of your life, payments from the pension fund are only made as long as there is money on your account. On the other hand, all of the assets in the fund belong to the recipient of the pension, and when they pass away, they are transferred to their heirs.

In a lump sum: when up to 10 times the national pension rate has been accumulated

Money can be withdrawn from the 2nd pension pillar in a lump sum, when less than 1893 € have been accumulated in the pension fund.

Bequeathing

The assets of the pension fund can be bequeathed. Heirs are free to choose whether to withdraw the amount at once or to inherit fund shares. An income tax of 20% applies to the cash payments.

Taxes

An income tax of 20% applies to the payments from the pension fund. The income tax calculation is based on the tax exemption to the monthly income of a pensioner, which in 2018 is 500 €.

LHV Pensionifond XL - The boldest choice

Suitable if

  • you have more than 15 years left until retirement,
  • you are prepared to take above-average risks,
  • your aim is the long-term growth of your pension savings.
Join the fund
Strategy

We allocate up to 75% of the fund’s assets into shares, i.e. obtaining holdings in companies. We invest the rest into bonds and real estate. In 2012, we changed our investment strategy; until then, up to 50% was invested into shares.

Rate of return

From the beginning / Current year / Current month

Expenses

Entry fee 0% / Exit fee 0% / Management fee 1.20%

Information about the fund

Volume of the fund (as of 28.02.2019)175,154,598.05 €

Price of a unit

Management companyLHV Varahaldus

Equity in the fund530 000 units

Rate of the depository’s charge0.0588% (paid by LHV)

DepositoryAS SEB Pank

We will allocate your money into international enterprises, the development of which we believe in. At the same time, it must be taken into consideration that the future of these enterprises depends on both their internal decisions as well as the changes in the global economy.

The data is presented as at 28.02.2019.

Biggest investments
Luminor Bank 10/20213.81%
EfTEN Kinnisvarafond3.58%
Riigi Kinnisvara 06/20273.09%
France 10/20222.73%
East Capital Baltic Property Fund II2.42%
East Capital Baltic Property Fund III2.37%
Berkshire Hathaway 01/20212.36%
Allianz Finance 12/20202.19%
JP Morgan Chase 08/20212.08%
iShares DAX EX1.98%
Current asset allocation
Money and deposits2.15%
Government bonds5.18%
Corporate bonds56.02%
Real estate12.49%
Shares24.16%
Regional distribution
Money and deposits2.15%
The Baltic states42.19%
Europe (excl. the Baltic states)37.85%
Asia4.90%
North America12.72%
Other0.19%

Calm month on stock markets

Kristo Oidermaa, Fund Manager

February was relatively relaxed on the world’s stock markets. The stock market indexes of developed countries were mainly on the rise, e.g. the index containing Europe’s 50 largest publicly traded companies increased by 4.4% in the month. In February, the Japanese stock market index increased by 2.9% measured in local currency and by 1.2% measured in euros. From the stock markets of developing countries, Asian countries, led by China, showed strong results, but the Latin-American stock market indexes were mainly decreasing. The stock market indexes of Riga and Vilnius remained at the level of the last month, rising by 0.3% and 0.6% respectively. However, the Tallinn stock exchange dropped by 1.7% in February. Pension fund XL has invested in four Estonian risk capital funds that all made new investments in 2018. For instance, Karma Ventures invested in the start-up company MeetFrank established by Estonians, bringing together employers and anonymous job seekers. Superangel One fund made a total of 8 new investments, including in an already known Estonian start-up company Veriff that provides customer identification services. Trind Ventures made 6 investments, two of which, Speakly and Tandem, offer various ways of learning languages.

At the beginning of March, the European Central Bank decided to inform the market of imminent new loan programmes to banks of the euro zone. The growth estimates of the European economy have already been lowered in February and the longer term government bonds of Germany were not far from the price level in which the future expected rate of return would be on the negative side again. As a counterbalance, the prices of corporate bonds increased both on the markets of the stronger and especially of weaker issuers. Companies also loaned out record volumes of new money by issuing new bonds. The bond portfolios of our funds are mostly based on external instruments of the financial market and this is also the direction that we hope to use for future additions. The outlooks of the international credit market are on the weaker side according to our assessments.

The type of disbursement depends on how much you have accumulated in the fund. The type of payments can be predicted with the concept of the national pension rate, the sum of which is established on the basis of an annually set index. Since April 2018 the sum is 189.31 €.

How can the funds be withdrawn from the second pillar?

See video

Pension agreement: when more than 50 times the national pension rate has been accumulated

The main option of withdrawing the money accumulated in the 2nd pillar fund is to conclude a pension agreement. This means that upon retirement you conclude an agreement with a life insurance company, handing the funds accumulated in the pension fund over to the disposal of the company. In return, the insurance company will pay you a regular pension until the end of your life. This is important information, as insurance companies are making estimations about the duration of the pension age and calculate the sum of the disbursements made to you. If you live a healthy life and to an old age, the insurance company will make payments to you in a larger amount than the one accumulated in the fund. Otherwise, the insurance company keeps some of the money and uses it to make payments to clients who live to an older age.

Funded pension: when up to 50 times the national pension rate has been accumulated

When up to 9465 € has been accumulated in the pension account, the money can be used with periodical payments from the pension fund. For this, an application must be filled in at a bank office or the online bank. In your application, notify the bank of the desired period of the payments and the total duration of the pension payments. How short the period can be is determined by the Funded Pensions Act and depends on the age of the pensioner. Unlike an insurance company, which pays you a pension for the rest of your life, payments from the pension fund are only made as long as there is money on your account. On the other hand, all of the assets in the fund belong to the recipient of the pension, and when they pass away, they are transferred to their heirs.

In a lump sum: when up to 10 times the national pension rate has been accumulated

Money can be withdrawn from the 2nd pension pillar in a lump sum, when less than 1893 € have been accumulated in the pension fund.

Bequeathing

The assets of the pension fund can be bequeathed. Heirs are free to choose whether to withdraw the amount at once or to inherit fund shares. An income tax of 20% applies to the cash payments.

Taxes

An income tax of 20% applies to the payments from the pension fund. The income tax calculation is based on the tax exemption to the monthly income of a pensioner, which in 2018 is 500 €.

LHV Pensionifond Indeks – Continuous investment

Suitable if

  • you want to invest on financial markets on a continuous basis,
  • wish to grow your pension pillar at the lowest possible costs,
  • have prior personal investment experience.
Join the fund
Strategy

We invest broadly in equity and real estate funds. When investing, we prefer funds that are exchange traded (ETF), have a low cost rate, hold physical assets (not synthetic), are cost effective, liquid and follow the base index. Up to 75% of the fund’s assets have been invested in equity funds, the rest in real estate funds. We invest in equity funds both in developed, emerging as well as frontier markets, based on global GDP distribution. Whenever the proportion of money in the fund exceeds 2%, it is invested within five working days.

Rate of return

From the beginning / Current year / Current month

Expenses

Entry fee 0% / Exit fee 0% / Management fee 0.39%

Information about the fund

Volume of the fund (as of 28.02.2019)13,286,793.74 €

Price of a unit

Management companyLHV Varahaldus

Equity in the fund468 750 units

Rate of the depository’s charge0.0588% (paid by LHV)

DepositoryAS SEB Pank

We invest up to 75% of the fund’s assets in equity funds, the rest in real estate funds. We invest in equity funds both in developed, emerging as well as frontier markets, based on global GDP distribution. Whenever the proportion of money in the fund exceeds 2%, it is invested within five working days.

The data is presented as at 28.02.2019.

Biggest investments
Lyxor Core MSCI World DR UCITS28.67%
Amundi Index FTSE EPRA Nareit Global UCITS ETF26.80%
db x-trackers MSCI Emerging Markets Index UCITS20.76%
iShares Core MSCI World UCITS13.83%
db x-trackers MSCI World Index UCITS ETF4.58%
Vanguard FTSE Emerging Markets UCITS ETF2.07%
iShares MSCI Frontier 100 ETF1.88%
Current asset allocation
Money and deposits1.42%
Real estate26.80%
Shares71.79%
Regional distribution
Money and deposits1.42%
Emerging Markets22.83%
Frontier Markets1.88%
Developed Markets73.88%

The type of disbursement depends on how much you have accumulated in the fund. The type of payments can be predicted with the concept of the national pension rate, the sum of which is established on the basis of an annually set index. Since April 2018 the sum is 189.31 €.

How can the funds be withdrawn from the second pillar?

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Pension agreement: when more than 50 times the national pension rate has been accumulated

The main option of withdrawing the money accumulated in the 2nd pillar fund is to conclude a pension agreement. This means that upon retirement you conclude an agreement with a life insurance company, handing the funds accumulated in the pension fund over to the disposal of the company. In return, the insurance company will pay you a regular pension until the end of your life. This is important information, as insurance companies are making estimations about the duration of the pension age and calculate the sum of the disbursements made to you. If you live a healthy life and to an old age, the insurance company will make payments to you in a larger amount than the one accumulated in the fund. Otherwise, the insurance company keeps some of the money and uses it to make payments to clients who live to an older age.

Funded pension: when up to 50 times the national pension rate has been accumulated

When up to 9465 € has been accumulated in the pension account, the money can be used with periodical payments from the pension fund. For this, an application must be filled in at a bank office or the online bank. In your application, notify the bank of the desired period of the payments and the total duration of the pension payments. How short the period can be is determined by the Funded Pensions Act and depends on the age of the pensioner. Unlike an insurance company, which pays you a pension for the rest of your life, payments from the pension fund are only made as long as there is money on your account. On the other hand, all of the assets in the fund belong to the recipient of the pension, and when they pass away, they are transferred to their heirs.

In a lump sum: when up to 10 times the national pension rate has been accumulated

Money can be withdrawn from the 2nd pension pillar in a lump sum, when less than 1893 € have been accumulated in the pension fund.

Bequeathing

The assets of the pension fund can be bequeathed. Heirs are free to choose whether to withdraw the amount at once or to inherit fund shares. An income tax of 20% applies to the cash payments.

Taxes

An income tax of 20% applies to the payments from the pension fund. The income tax calculation is based on the tax exemption to the monthly income of a pensioner, which in 2018 is 500 €.

LHV Pensionifond Eesti – maximum investment in Estonia

Suitable if

  • you have more than 15 years left until retirement,
  • you want to link your pension with the Estonian economy,
  • you also have investments in other regions.
Join the fund
Strategy

The fund invests, subject to the availability of suitable investments, 100% in Estonia. Investments are made in shares, debts, real estate, and also in other funds. Since the number of securities traded on the Tallinn Stock Exchange is low, the fund invests extensively outside the exchange. Since the fund is linked to one region, it would not be wise to invest all your pension assets in this fund.

Rate of return

From the beginning / Current year / Current month

Expenses

Entry fee 0% / Exit fee 0% / Management fee 1.20%

Information about the fund

Volume of the fund (as of 28.02.2019)2,323,286.97 €

Price of a unit

Management companyLHV Varahaldus

Equity in the fund2 690 184.87 units

Rate of the depository’s charge0.0588% (paid by LHV)

DepositoryAS SEB Pank

The assets of LHV Pensionifond Eesti are invested mostly in Estonia – the country in whose development we have faith and whose potential we know the best. The results of the fund are directly dependent on the well-being of the Estonian economy and Estonian companies. Due to a scarcity of suitable investments, the share of each investment is relatively high.

The data is presented as at 28.02.2019.

Biggest investments
Birdeye Timber Fund5.09%
EfTEN Kinnisvarafond II4.97%
Tallinna Kaubamaja4.63%
Eesti Energia 09/20234.46%
auto24 04/20224.38%
Allianz Finance 12/20204.34%
Berkshire Hathaway 01/20214.33%
Baltic Horizon Fund 05/20234.33%
Transpordi Varahaldus 12/20264.33%
Luminor Bank 10/20214.32%
Current asset allocation
Money and deposits8.36%
Corporate bonds47.81%
Real estate19.13%
Shares24.69%
Regional distribution
Money and deposits8.36%
The Baltic states67.84%
Europe (excl. the Baltic states)19.46%
North America4.33%

Fund influenced by the drop on the Tallinn stock exchange

Kristo Oidermaa, Romet Enok, Fund Managers

Tallinn stock exchange fell by 1.7% in February, largely due to the shipping company Tallink’s weak results in Q4 that led to a 5.1% drop in its shares. The company’s income decreased by 2.7% compared to Q4 of 2017 and suffered a 1.1 million euro loss. The number of passengers decreased by 3.3% in Q4 but remained the same overall in 2018. On the other hand, Tallink plans to pay out dividends of 5 cents per share and reduce the share capital by 7 cents per share, making the rate of return of the disbursements more than 11%. However, Tallinna Sadam reported strong results, increasing its income by 9.2% in Q4 and by 7.7% in 2018. The company’s operating profit margin also improved. Tallinna Sadam plans to pay out at least 30 million euros in dividends to shareholders for 2018, making the expected dividend yield at least 5.3%.

Market overview of pension funds

Attention regarding private capital investments
Andres Viisemann, Head of LHV Pension Funds

For me, the current year began on an unexpectedly positive note in the case of international securities markets. Measured in euros, US stock markets rose in the first month of the year by 7.9%, with European and Japanese shares rising by 5.5% and 5.2%, respectively.

Ask for advice

Do not hesitate to ask, together we will find a suitable solution.

Reet Roos
Pension Consultant
Mon–Fri 8–17
680 2743
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