The German retirement system will have to continue to adapt to new circumstances through a series of changes to sharpen its private and occupational pensionsprovision, according to panellists speaking at the virtual Handelsblatt annual conference on occupational pensions this week.

Measures should be adopted to make savings products “more profitable than today”, if the aim is to rely on private pension provisions, said Dorothea Mohn, head of the financial market team at the organization for the protection of consumers Vzbv.

She said that savings through equity investments, diversification and waving guarantees are necessary to increase returns for private pensions, adding that an Extra Rente would reduce the costs for marketing retirement products.

“If we are not ready for this, then we have the statutory pension systems in Germany and the starting point [for a change] can be found there,” she added. Axel Kleinlein, board member of the Bund der Versicherten, agreed that the Extra Rente “can be a solution” to having a grip on costs, but capital-covered pension provisions are seen as “synonymous of life insurance”, which is “highly problematic”.

He added that retirement provisions have to be shaped according to individual needs, and options expanded. Georg Thurnes, chair of the board for the occupational pension association aba, pointed that with or without negative interest rates, the only option is to save in the “active phase with possibly a lot of equity”.

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