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- Accumulated experience: Russians least of all trust their pensions to NPFs and insurers
Accumulated experience: Russians least of all trust their pensions to NPFs and insurers
Most Russians still expect the state to provide them with a decent old age. Therefore, many people are in no hurry to make their personal savings. Another factor is distrust of non—governmental institutions. Thus, citizens are least willing to give their savings to foundations and insurers. At the same time, they consider the Social Fund and corporate programs from the employer to be more reliable, according to a study by the Financial University (Izvestia has reviewed it). The reasons are the fear of losing money, the memory of crises and the freezing of savings. As a result, voluntary savings do not become widespread. What this can lead to and what solutions are proposed by the authorities and the market — in the material of Izvestia.
Why Russians don't trust pension funds
More than two thirds of Russians believe that the state should be responsible for future pensions. At the same time, almost a third of citizens (32%) admit that they simply do not have free money to save for old age. An additional factor is distrust of the system itself, according to a March study by the Financial University (Izvestia has it).
Against this background, the level of trust in different instruments is expected to be distributed. Thus, Russians are least willing to transfer money to non—governmental pension funds (NPFs) - their indicator has gone into negative territory (-18 index points). The situation is slightly better for insurance companies, but also negative (-12.2 percentage points). At the same time, government and corporate mechanisms are most trusted: the Social Fund (+12 percentage points) and programs from employers (+10 percentage points).
In Russia, the system is designed so that the basic pension is formed by the employer — at the expense of mandatory contributions. However, citizens also have the opportunity to influence future payments on their own. For example, voluntary contributions to the Social Fund can be made by the self-employed or those who want to increase their savings.
The reasons for distrust are complex. According to the study, people are offered to save for 10-15 years ahead, but in conditions of uncertainty, this is perceived more as a risk than as a strategy. Citizens are afraid that the rules of the game will change, the money will become worthless, or they simply will not live to see the payments. In addition, some Russians believe that it is too early to think about retirement, and almost half do not see any sense in savings at all — the expected increase seems too small.
Skepticism is largely fueled by past experience. Russians have already faced financial losses, from the pyramids of the 90s to the bankruptcies of individual funds and companies in the early 2000s, Natalia Milchakova, a leading analyst at Freedom Finance Global, recalled. According to her, additional doubts were raised by the freezing of the funded part of pensions.
We are talking about the one that was formed before 2014: then 6% of contributions were sent to personal accounts of citizens. Later, a moratorium was introduced, and all deductions began to go to the insurance part (22%). At the same time, the accumulated funds have not disappeared — they continue to be invested and will be available upon reaching the age of 55 for women and 60 for men.
Why do people trust the state more?
However, it's not just about past experiences. Experts also point to a number of systemic factors that continue to constrain interest in savings.
Thus, the instability of the rules and the weak transparency of the pension system undermine confidence in long-term instruments, said Yaroslav Kabakov, Director of Strategy at IC Finam. According to him, due to constant changes, private funds are perceived as complex and incomprehensible structures with unobvious returns, while the Social Fund is associated with government guarantees, and corporate programs are more manageable.
In addition, many citizens simply do not understand the mechanisms of pension products and are not ready to plan for decades ahead, he added. As a result, money "for the future" is perceived as frozen funds, not as an investment.
An additional limitation is the income level. A significant part of the population does not have the opportunity to form long-term savings: current expenses are more important, said Anastasia Gorelkina, Deputy Chairman of the Board of Directors of HC Siberian Business Union.
The profitability factor is also important. In some cases, the investment results of NPFs did not exceed those of the state management company (VEB.Russian Federation), which uses conservative strategies. This also reduces the attractiveness of such tools, she noted.
Finally, the cultural attitude persists: many Russians still perceive retirement as a state responsibility. This model has its roots in the Soviet period, when it was the authorities who fully provided payments, said Lyudmila Ivanova-Shvets, Associate Professor at Plekhanov Russian University of Economics. According to her, even young citizens often continue to rely primarily on a state pension, without considering savings as an obligatory part of their financial strategy.
How Russians save for old age
In practice, Russians choose more familiar savings tools — deposits, cash and real estate, less often investment accounts and long-term programs, said Yaroslav Kabakov from Finam. Deposits benefit from trust, but are often inferior to inflation, whereas more profitable instruments require knowledge and risk tolerance.
Russians actively carry money to deposits and keep them there for years, shifting them between banks, added Gleb Yakovlev, vice president of the All-Russian Union of Insurers (VSS). Accumulative life insurance for a period of five to 10-15 years is also popular, which combines savings with protection and the possibility of regular payments. However, specialized pension programs of insurers are still less in demand, he said.
At the same time, the Bank of Russia notes an increase in interest in long-term instruments: by the end of 2025, more than 50 million people were saving in NPFs (+12% per year), and almost 12 million citizens are already participating in the long-term savings program, over 875 billion rubles have been attracted, the press service of the Central Bank told the editorial staff.. The regulator attributes this to government support, tax benefits and protection of funds up to 2.8 million rubles. According to the Central Bank's forecast, by the end of 2026, the volume of the program will reach 1.5 trillion rubles. At the same time, the profitability of NPFs on such products is kept at about 20% per annum, which is higher than inflation, they said.
The Ministry of Finance told Izvestia that the increase in the number of participants indicates a high interest in long-term savings and trust in NPFs. They emphasized that funds invest funds taking into account the balance of profitability and risk, are under constant control of the Central Bank, and citizens' savings are additionally protected by the state insurance system.
What will the rejection of retirement savings lead to?
The refusal to save independently for retirement has systemic consequences, both for the economy and for citizens themselves, said Natalia Milchakova from Freedom Finance Global. On the one hand, the amount of "long money" that could be used for investments and loans is decreasing, on the other hand, the attitude is being formed that the state will fully provide in old age. At the same time, in Europe, the high standard of living of pensioners is largely provided by non-governmental funds and insurance companies.
According to the NAPF, in Russia NPFs cover only about 8% of the population, while in Sweden — 99%, in Australia, Switzerland and Chile — more than 70%, in the USA — about 68%. Russians' retirement savings account for only about 3% of GDP, compared with more than 160% in Europe and the United States.
This model leads to an increased burden on the budget and the risk of a decline in living standards in the future, Yaroslav Kabakov noted. Demographics are creating additional pressure: the number of people working in relation to pensioners is decreasing. As a result, as Anastasia Gorelkina from the Siberian Business Union emphasized, without personal savings, the state pension often will not be able to provide the usual standard of living, and the economy will not be able to get the resources for growth.
What can motivate citizens to save for retirement
The Financial University study notes that the further development of the pension market requires coordinated actions by all participants. Among the key measures are the expansion of state support and tax incentives, increased transparency and guarantees of the safety of funds, as well as active information work with citizens. Employers will have to integrate corporate programs deeper into the social package and simplify employee participation, while NPFs will have to expand their product line and reduce barriers.
A separate issue is trust. It can be increased through additional guarantees, Natalia Milchakova believes: it is, in particular, about insurance of pension savings by analogy with bank deposits and simplification of the transition between funds without loss of income.
A similar position is shared in the insurance sector. Stable rules and clear incentives are critical for long-term investments, said Gleb Yakovlev from the VSS. According to him, life insurers fulfilled their obligations even in crises, and from 2027 a guarantee system will be launched that will cover existing contracts.
The Central Bank also told Izvestia that trust in NPFs can increase due to the increased technology of their services: the ability to apply for a tax deduction "in a few clicks", remotely manage an account and change an operator through a personal account reduces barriers for customers and makes products more understandable.
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