What's your retirement age in 20 years?

The number of pensioners in Slovenia is set to rise significantly over the next two decades, according to data from the Pension and Disability Insurance Fund. As of today, there is currently one pensioner for every 1.5 contributors, a ratio that is expected to shift dramatically by 2040. The European Commission estimates that there will be approximately 84,000 more pension recipients than contributors in Slovenia by that year, with around 54,000 fewer employed individuals compared to 2022. These projections align with broader demographic trends, as statistical office reports indicate a sharp aging population. By 2050, nearly one-third of the population could be over the age of 65. Mathematics is simple. More people will receive pensions, while the proportion of those funded through contributions will decline. The public pension system will remain the foundation of pension security, but maintaining a lifestyle comparable to working years will increasingly depend on individual actions. One key option is voluntary additional pension insurance (PDPZ). Many still view this as an extra cost, yet it represents a strategic financial decision that enables long-term savings with tax incentives. Employers benefit too, as PDPZ offers an effective incentive for employees. The expansion of additional pension savings has broader implications beyond personal finance. Pension funds play a crucial role in financial markets, contributing significantly to demand for financial instruments. Their investments help stabilize markets and create opportunities for growth. In Slovenia and Croatia, strengthening pension funds further stimulates the development of financial markets. There persists a common misconception that voluntary pension savings are merely an additional expense. While discussions increasingly emphasize that individuals must take greater responsibility for their financial security after retirement, many still perceive PDPZ as just another monthly cost, something difficult to afford. In reality, the picture is quite different. Voluntary additional pension insurance is one of the few methods of long-term saving where the individual is not solely responsible for contributions. The state encourages such savings through tax benefits, and the funds grow continuously on financial markets. All accumulated capital and generated returns belong to the saver throughout the period. Upon retirement, these can be accessed as additional pension income, providing essential supplementary income during a time when regular pensions often fall short of sustaining the same standard of living as during active careers. Tax relief is among the most significant, yet least known advantages of this form of savings. Due to these benefits, the actual cost of monthly contributions is lower than it appears at first glance. For a financially secure future, it's not just how much we save that matters, but primarily when we start. A practical example illustrates how this works. Žiga, aged 32, earns an average gross salary of €2,678 per month. If he contributes €100 each month, or €1,200 annually, to a voluntary additional pension fund, he could receive approximately €312 in tax refunds. This means his real monthly cost of saving is about €74. If he continues this level of contribution until retirement at 67, he would have contributed a total of €41,580 over 35 years. After accounting for tax benefits, his actual cost would be approximately €31,080. Based on the assumptions used in the calculation, upon retirement, he would have access to roughly €159,000 in accumulated funds. Individuals interested in calculating their potential tax benefits from additional pension savings can use an informative calculator available on the website of PRVA Pension Company. It takes just a few minutes to determine how much they could save through this method. Time is the most critical factor in pension savings. While the amount saved is important, the timing of starting to save is even more crucial.