On 2 September, Luminor will reduce the management fees of its active second pillar pension funds by 13 per cent and focus even more on equity markets.

The last time the management fees of Luminor’s pension funds decreased was on 1 February this year. Member of the board at Luminor Pensions Estonia Martin Rajasalu said that reducing the fees will certainly have some impact on the returns of the funds. “Younger people who are saving for retirement in active funds will benefit the most from the reduction of fees, as the fees of these funds used to be higher,” added Rajasalu.

The investment strategies of Luminor’s funds will also change in such a manner that they will be investing more in equity markets in the future. According to Rajasalu, the increasing retirement age and rising life expectancy both support investment strategies aimed at equity markets. “We need money for longer and must grow it more forcefully, but the increasing retirement age means we also have more time for saving money,” explained Rajasalu. “The changes in our pension funds mean that future pensions can grow on the account of lower management fees and meet the expectations of clients better due to a larger share of equities.”

Change of the share of equities in Luminor’s second pillar pension funds

Pension fund

Current %

New maximum %

Luminor A Plus

75

100

Luminor A

50

60

Luminor B

25

30

Luminor C

0

10

We will review the management fees again next January.

For further information please contact Martin Kõrv.