Why shouldn't that be possible - after all, there have been many reforms in recent decades. However, the private capital formation that was propagated before the last financial crisis will not make a significant contribution to the restructuring of old-age security systems. Rather, it will be necessary to adjust the retirement age accordingly as life expectancy increases, whereby special regulations are required for critical groups of employees who work in physically demanding jobs in particular. But these groups, too, will become less significant in terms of numbers as a result of technical progress.

For more details see:

https://www.researchgate.net/publication/273897833_Sicherheit_der_Renten_Security_of_Pensions_Die_Zukunft_der_Altersversorgung

You would need to distinguish the different funding requirements of:

Because the central banks have been pursuing a zero interest rate policy since the last financial crisis, meaning that the compound interest effect in private pensions has disappeared. Without this, it is far less worthwhile than in the past, so that the state-subsidized private systems in Germany have become largely uninteresting for old-age security.

For more details:

https://www.researchgate.net/publication/274071783_Risk_Taking_Principal_Agent_Problems_and_Breakdown_of_Coporate_Social_Responsibility_CSR_How_to_Reestablish_Safe-Assets_and_Capital_Funding_for_Social_Security

In short, if we want to add additional resources to the legislation to fill the pension funds, we need the agreement of the different participants, e.g. the Government, politics, the financial sector - banks, etc. on the national and international level? The more resources (e.g. 5% from lotteries, 1% from confiscated assets of organised crime - drugs) the more different actors have to agree on? We need some inventions to speed up and simplify these processes. What is Your opinion? Is there any perspective/research in this area?

It makes little sense to look for alternative sources of funding for the state pension system. Because old-age security is a comprehensive concept that should be based on several pillars. In addition to the state pension system, which works according to the pay-as-you-go system, there should be other pillars of old-age security through private insurance and private capital formation, including in the area of ​​privately used real estate. If one also counts the sustainable parts of private asset accumulation for old-age provision, then the future prospects in this area look much more favourable.

thanks for the comprehensive information! Very instructive. A very difficult problem to overcome would be that many people would not be able to fund private forms of insurance. For people with more or at least average purchasing power, this would be the solution. Perhaps the combination of alternative sources of funding for the pension fund and the possibility of private funding would be theoretically more comprehensive. In practice, however, it turns out that there are problems with agreements or communication. In essence, it is a more sensible distribution of capital that could prevent even greater poverty?!

The problem of too low pensions from the state pension system was also solved by occupational pension schemes in the larger private companies prior to the zero interest rate policy, although these have recently become much rarer. In addition to the state pension scheme, possible pillars are still the company pension schemes, private insurance and the entire private assets of pensioner households. All of these sources determine the actual supply level of households with employees who are no longer active. Despite everything, there are still households that do not have sufficient old-age income. Ultimately, a political decision must be made as to whether these should be secured through minimum pensions in the state old-age security system or through the social welfare system. Both instruments can at least alleviate poverty in old age.

Not the ideal scenario But better than nothing at all. What about the 1000 Eur scenario for all retirees. Is this idea still alive and how could it work (eg Denmark)? Poverty is like distress, crime on the darknet, air/water pollution, mass migrations from Africa and Asia, viruses and climate change one of the strongest problem in our world which can only be solved by international power (economists, politics, sociologists, legal experts etc.). Our descendants are not in a good position.

I can only offer my personal opinions based on my experience from living in the UK.

State provision for financial support in old age has always been niggardly, ever since the Old Age Pension was introduced by Lloyd George before WW1. However, a substantial minority had access to additional funds through occupational pension schemes, run by employer, which received contributions from employers and employees which were invested and the interest and dividends provided the pensions. They were very good investments from the tax avoidance point of view.

However, in the 1980s, the Conservative government legislated to the effect that pension funds could only hold sufficient assets to meet reasonably foreseeable liabilities, otherwise they would face significant penalties, So that put the kybosh on investing for 'blue sky' events, such as (say) a long period of poor stock market returns, or an increase in life expectancy.

In 1997, the Labour Govt cancelled Advance Tax Credits. That cost £5BN to start with, and depending on who you ask over the 13 years of the Labour govt. it deprived the pension funds of between £75 - 120 BN (and some would say more!)

Then, in 2001, in order to be declared solvent, pension funds had to be able to meet the sum total of all their liabilities - up to 20 - 30 years in to the future - in a single year! I saw the annual report of a firm in which I hold some shares. Their pension fund had a deficit of £800K during that period. So the directors resolved to transfer £800K from the reserves to the pension fund. However, under the terms of the new legislation, what cost £800K now cost £5.7M for just one year. To buy this deficit out in perpetuity would cost £42M!!! I could go on.......

Bw

Chris Ide

One can view the old-age security problem with a certain degree of optimism if one also includes the intergenerational transfers of assets (inheritances) into the consideration. Of course, this applies to the more affluent sections of the population; but the problem of poverty is always a relative problem, at least in developed economies. Due to the existing security systems, poverty in Germany cannot be compared at all with the precarious situation of an average pensioner household in Russia, for example. Income differences will never be leveled out for a variety of reasons, but with an improvement in vocational training for broad sections of the population, the individual levels of provision will also continue to adjust with the general development of prosperity.

In essence, this is a general principle of the distribution of capital. The subsistence minimum can be easily determined (in Slovenia it is around 550 Eur). It is a question of it would be possible to determine the subsistence maximum as well? Investments in the pension system would also be possible on the basis of determining the subsistence maximum. Exceeding the subsistence maximum can go in the direction of unproductive capital. When determining the subsistence maximum e.g. billion euros could e.g. 5% of this surplus went to pension system investment. Maybe that could prevent even more poverty? We must not forget that excessive poverty can be much linked to mass migration, and in particular, to crime on the darknet. This can be a real magnet for people who are completely poor or on the brink of poverty. International insights would be needed in this view, because both excessive poverty and mass migration are an international problem that Europe alone cannot solve on its own. Much will depend on future decisions by financiers, lawyers, and politicians to prevent the blackest scenarios in the form of social unrest and the invisible dominance of the criminal darknet. Pension systems and the most efficient distribution of capital are not an island in themselves, but both can be closely linked to other social developments.

It's perfectly clear - a lot of terrible things can happen. But I would answer it with the optimism of our former Chancellor: We can do it („wir schaffen das“)!

Das ist die richtige Einstellung. Bin dafür:))

There is also the trend of cryptocurrencies and mining through them with intelligent robots. Perhaps this could be an additional solution for the additional income of pensioners or people in general. The big problems with these cryptocurrencies are so far extreme value fluctuations and of cause money laundering (buying cryptocurrencies with counterfeit money and then selling it for real money).

No.

Dear Aijaz Panhwar, thank You for that! Any war, mass migation etc. can have an additional negative impact on the whole system. We are too connected to each other not only by financial views. By my opinion to solve these great challenges it is not enough to Observe only the financial and pension system. The distribution of finances is extreme asymetric and there is more and more poverty In this world. An international interdiscipliray holistic approach Is needed to solve more effective these challenges about pension systems and other future world problems.