II pillar

LHV pension funds have the highest 15-year rate of return¹

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 0.585%

Information about the fund

Volume of the fund (as of 31.03.2018)20,386,603.45 €

Price of a unit

Management companyLHV Varahaldus

Equity in the fund110 000 units

Rate of the depository’s charge0,06% (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 31.03.2018

Biggest investments
France 05/20277.08%
Riigi Kinnisvara 06/20274.93%
Germany 09/20224.79%
Czech Republic 05/20224.66%
Transpordi Varahaldus 04/20254.38%
Temasek Financial 03/20224.33%
Slovakia 11/20243.90%
Elering 07/20183.75%
United States 08/20192.77%
Amber Circle Funding 12/20222.60%
Current asset allocation
Money and deposits26.95%
Government bonds31.88%
Corporate bonds41.19%
Regional distribution
Money and deposits26.95%
The Baltic states29.80%
Europe (excl. the Baltic states)27.35%
Asia8.91%
North America2.77%
Other4.24%

The February result was positive

Romet Enok, Fund Manager

The Fund showed a slight 0.1% return in February, when the government bond markets of the Eurozone recovered following a rather sharp drop in January. Even so, all of the bigger Eurozone governments were able to finish the month in positive territory. The broad-based nature of the rise also provided support to those bonds that are located a bit further from the centre of the currency union. We have also primarily invested in the above at present, while the risk of a rise in long-term interest rates remains high, since the end of support measures by the European Central Bank is expected. In addition, the strengthening of the dollar against the euro provided a boost to the total net gain of the Fund. Along with these positions we continue to hold assets in deposits, thereby avoiding the expected negative turnover of short-term bonds and the risk of the fall in price of long-term bonds.

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 2017 the sum is EUR 175.94.

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 EUR 9000 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 EUR 1800 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 2017 is EUR 416.

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 0.684%

Information about the fund

Volume of the fund (as of 31.03.2018)62,304,430.89 €

Price of a unit

Management companyLHV Varahaldus

Equity in the fund270 000 units

Rate of the depository’s charge0,06% (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 31.03.2018

Biggest investments
France 10/20225.11%
Riigi Kinnisvara 06/20274.83%
Transpordi Varahaldus 04/20254.53%
Temasek Financial 03/20224.29%
Latvenergo 06/20224.24%
Slovakia 11/20244.03%
Investor 05/20233.36%
Latvia 09/20253.01%
Total Capital Intl 03/20202.90%
Romania 10/20242.67%
Current asset allocation
Money and deposits11.29%
Government bonds25.17%
Corporate bonds63.52%
Regional distribution
Money and deposits11.29%
The Baltic states27.78%
Europe (excl. the Baltic states)42.35%
Asia7.20%
North America6.42%
Other4.94%

The February result was positive

Romet Enok, Fund Manager

Even though the bonds of undertakings in February remained at the level at which they were at the start of the month, the Fund was able to show a slight positive return (+0.1%), since government bonds rose and the dollar strengthened against the euro. After the rather sudden decline in January the markets received support in February from the increase in government bonds, which also had an impact on the results of the Fund via our investments. Even so, the risk of a rise in interest remains high and no new investments were made by the Fund during the month. The market for lower credit quality issuers had fallen by the middle of February by more than 1% since the start of the year, which also shows that there are risks hidden in the current high price level.

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 2017 the sum is EUR 175.94.

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 EUR 9000 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 EUR 1800 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 2017 is EUR 416.

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 1.008%

Information about the fund

Volume of the fund (as of 31.03.2018)99,927,389.72 €

Price of a unit

Management companyLHV Varahaldus

Equity in the fund380 000 units

Rate of the depository’s charge0,06% (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 31.03.2018

Biggest investments
EfTEN Kinnisvarafond4.61%
Riigi Kinnisvara 06/20274.22%
Transpordi Varahaldus 04/20253.62%
Luminor Bank 12/20193.31%
France 10/20223.28%
Tartu Linnavalitsus 10/20322.78%
Coop Pank 12/20272.34%
Autolist 04/20222.33%
Latvenergo 06/20222.30%
Citadele banka 12/20262.22%
Current asset allocation
Money and deposits3.43%
Government bonds14.14%
Corporate bonds65.65%
Real estate8.60%
Shares8.22%
Regional distribution
Money and deposits3.43%
The Baltic states56.74%
Europe (excl. the Baltic states)26.11%
Asia2.73%
North America10.00%
Other1.03%

Equity markets were nervous in February

Romet Enok, Fund Manager

After a long period of time with a steady rate of growth, equity markets became nervous in February and exchanges fell in developed as well as developing markets. The Japanese exchange index fell by 4.5%, when measured in the local currency. The biggest losers in Europe were Germany and Spain, with results of –5.7% and –5.8%, respectively.

The Tallinn Stock Exchange did not fall, instead growing by 2.2%. The stock market indexes of Riga and Vilnius showed a corresponding return of 0% and –0.3%, respectively. The result of Pension Fund M was supported by shares of Tallinna Kaubamaja, which reacted positively to the company’s plans to pay investors a record dividend. Namely, EUR 28.1 million or EUR 0.69 per share is to be distributed to shareholders. At the current share price this means a dividend yield of nearly 7% .

After extended negotiations, we reached an agreement in the bond portfolio to finance the buying out of the Euro Oil chain of filling stations by Alexela. The transaction requires the emission by Alexela to pension funds of 10-year bonds, which carry interest of 5.5% for the first five years and thereafter 5% above Euribor. The bonds are secured by the filling stations across Estonia acquired with the purchase and those already belonging to the company.

In terms of bonds, the position in Brasil Foods had a negative effect on the result for the month. Local pension funds, which are the company’s major shareholders, submitted a request to replace the chairman of the company's supervisory board, since the financial results had failed to meet expectations.

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 2017 the sum is EUR 175.94.

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 EUR 9000 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 EUR 1800 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 2017 is EUR 416.

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 1.260%

Information about the fund

Volume of the fund (as of 31.03.2018)760,828,702.93 €

Price of a unit

Management companyLHV Varahaldus

Equity in the fund2 400 000 units

Rate of the depository’s charge0,06% (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 31.03.2018

Biggest investments
EfTEN Kinnisvarafond5.22%
Riigi Kinnisvara 06/20274.54%
France 10/20223.41%
Luminor Bank 12/20193.38%
Latvia 09/20253.13%
Latvia 01/20213.09%
Lithuania 11/20242.29%
JP Morgan Chase 08/20212.25%
Wells Fargo & Company 07/20212.22%
Lithuania 01/20242.19%
Current asset allocation
Money and deposits1.70%
Government bonds18.59%
Corporate bonds49.81%
Real estate10.21%
Shares19.60%
Regional distribution
Money and deposits1.7%
The Baltic states54.09%
Europe (excl. the Baltic states)28.13%
Asia5.51%
North America9.40%
Other1.08%

Positive results of the Tallinn and Helsinki stock exchanges also had an effect on the Fund

Kristo Oidermaa, Fund Manager

After a long period of time with a steady rate of growth, equity markets became nervous in February and exchanges fell in developed as well as developing markets. The Japanese exchange index fell by 4.5%, when measured in the local currency. The biggest losers in Europe were Germany and Spain, with results of –5.7% and –5.8%, respectively.

In a surprising move, the Helsinki stock market rose due to Nokia beating expected quarterly results by 2.2%, with the Tallinn Stock Exchange also rising by the same amount. The stock market indexes of Riga and Vilnius showed a corresponding return of 0% and –0.3%, respectively.

The rate of return of Pension Fund L was supported by shares of Arco Vara, which rose by 1.4% during the month. The company’s revenue grew by 89% in 2017, thanks to the successful sale of apartments, and the company’s activity once again became profitable. Shares of Olympic rose by 1.6%, following the publication of strong financial results for 2017.

After extended negotiations, we reached an agreement in the bond portfolio to finance the buying out of the Euro Oil chain of filling stations by Alexela. The transaction requires the emission by Alexela to pension funds of 10-year bonds, which carry interest of 5.5% for the first five years and thereafter 5% above Euribor. The bonds are secured by the filling stations across Estonia acquired with the purchase and those already belonging to the company.

In addition, we reached an agreement with Coop Pank on the changing of the terminated deposit into a bond – the three-year bond signed at the beginning of March earns interest of 1.25% per year.

In terms of bonds, the position in Brasil Foods had a negative effect on the result for the month. Local pension funds, which are the company’s major shareholders, submitted a request to replace the chairman of the company's supervisory board, since the financial results had failed to meet expectations.

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 2017 the sum is EUR 175.94.

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 EUR 9000 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 EUR 1800 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 2017 is EUR 416.

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 1.260%

Information about the fund

Volume of the fund (as of 31.03.2018)143,602,996.28 €

Price of a unit

Management companyLHV Varahaldus

Equity in the fund500 000 units

Rate of the depository’s charge0,06% (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 31.03.2018

Biggest investments
EfTEN Kinnisvarafond4.59%
Luminor Bank 12/20194.18%
Riigi Kinnisvara 06/20274.06%
East Capital Baltic Property Fund II2.77%
Latvia 09/20252.72%
East Capital Baltic Property Fund III2.59%
France 10/20222.32%
WisdomTree Japan Hedged Equity Fund2.23%
Amber Circle Funding 12/20222.07%
JP Morgan Chase 08/20212.01%
Current asset allocation
Money and deposits1.80%
Government bonds8.69%
Corporate bonds52.37%
Real estate13.31%
Shares23.81%
Regional distribution
Money and deposits1.80%
The Baltic states48.39%
Europe (excl. the Baltic states)30.43%
Asia6.68%
North America10.95%
Other1.73%

Several new local investments were added to the Fund

Kristo Oidermaa, Fund Manager

After a long period of time with a steady rate of growth, equity markets became nervous in February and exchanges fell in developed as well as developing markets. The Japanese exchange index fell by 4.5%, when measured in the local currency. The biggest losers in Europe were Germany and Spain, with results of –5.7% and –5.8%, respectively. In a surprising move, the Helsinki stock market rose due to Nokia beating expected quarterly results by 2.2%, with the Tallinn Stock Exchange also rising by the same amount.

Pension Fund XL made investments in two risk capital funds created by Estonians, which support regional technology and IT sector start-ups. The Fund’s Superangel partners have previously invested in such well-known companies as Pipedrive, Taxify and GrabCad and they are also the co-founders of mobile payment provider Fortumo. The Trind Ventures Fund was established by Estonia’s well-known business angels and the European Investment Fund is one of its investors.

After extended negotiations, we reached an agreement in the bond portfolio to finance the buying out of the Euro Oil chain of filling stations by Alexela. The transaction requires the emission by Alexela to pension funds of 10-year bonds, which carry interest of 5.5% for the first five years and thereafter 5% above Euribor. The bonds are secured by the filling stations across Estonia acquired with the purchase and those already belonging to the company.

In terms of bonds, the position in Brasil Foods had a negative effect on the result for the month. Local pension funds, which are the company’s major shareholders, submitted a request to replace the chairman of the company's supervisory board, since the financial results had failed to meet expectations.

Additionally

Positive results of the Tallinn and Helsinki stock exchanges also had an effect on the Fund

After a long period of time with a steady rate of growth, equity markets became nervous in February and exchanges fell in developed as well as developing markets. The Japanese exchange index fell by 4.5%, when measured in the local currency. The biggest losers in Europe were Germany and Spain, with results of –5.7% and –5.8%, respectively.

In a surprising move, the Helsinki stock market rose due to Nokia beating expected quarterly results by 2.2%, with the Tallinn Stock Exchange also rising by the same amount. The stock market indexes of Riga and Vilnius showed a corresponding return of 0% and –0.3%, respectively.

The additional rate of return by the pension fund was supported during the month by shares of the Tallinn Stock Exchange, where strong financial results for 2017 were announced: investors were pleased by Arco Vara, Olympic as well as Tallinna Kaubamaja. The pension fund also increased its investment in the East Capital Baltic Property Fund III, which invests in commercial real estate located in the capitals of the Baltic states.

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 2017 the sum is EUR 175.94.

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 EUR 9000 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 EUR 1800 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 2017 is EUR 416.

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 31.03.2018)8,169,509.11 €

Price of a unit

Management companyLHV Varahaldus

Equity in the fund468 750 units

Rate of the depository’s charge0,06% (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 31.03.2018

Biggest investments
Amundi Index FTSE EPRA Nareit Global UCITS ETF12.21%
iShares Core MSCI World UCITS7.97%
iShares Global REIT ETF7.56%
db x-trackers MSCI World Index UCITS ETF6.68%
iShares Core MSCI Emerging Markets ETF6.67%
db x-trackers MSCI Emerging Markets Index UCITS6.60%
Vanguard Total World Stock ETF6.58%
BNP Paribas Easy FTSE EPRA/NAREIT Eurozone Capped6.49%
Vanguard FTSE Emerging Markets ETF6.44%
Vanguard FTSE All-World UCITS ETF6.25%
Current asset allocation
Money and deposits0.71%
Real estate26.95%
Shares72.33%
Regional distribution
Money and deposits0.71%
Emerging Markets23.16%
Frontier Markets2.65%
Developed Markets73.47%

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 2017 the sum is EUR 175.94.

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 EUR 9000 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 EUR 1800 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 2017 is EUR 416.

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 1.26%

Information about the fund

Volume of the fund (as of 31.03.2018)1,501,978.82 €

Price of a unit

Management companyLHV Varahaldus

Equity in the fund2 343 750 units

Rate of the depository’s charge0,06% (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 31.03.2018

Biggest investments
Eesti Energia 09/20237.22%
Tallinna Kaubamaja4.68%
Tallink Grupp2.18%
Silvano Fashion Group1.37%
Harju Elekter1.04%
Ekspress Grupp0.78%
EfTEN Real Estate Fund III0.53%
Nordecon0.25%
Current asset allocation
Money and deposits81.95%
Corporate bonds7.22%
Real estate0.53%
Shares10.30%

The first overview of the fund will be made available as at the end of the month.

Market overview of pension funds

Positive start to spring: new Estonian investments, new Estonian fund
Andres Viisemann, Head of LHV Pension Funds

The beginning of the year was successful for LHV pension funds. Given the situation where all major stock markets were in the red as at the end of February, the LHV pension funds have managed to protect the pension assets of its unit holders. Global stock markets had lost 2.1% of their value by the end of February. Whereas the European stock markets had lost 3.9% over the first two months of the year and North American stock markets 2.6% of their value, measured in euros. At the same time, it is interesting to note that the stocks of Estonian companies have moved in the opposite direction to major markets and as at the end of February were valued higher by 2,2% compared to the beginning of the year.

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
Sign up for a consultation