Market rate savings

With market rate savings – also called PFA Plus - you can influence how your monthly pension payments are invested.
This gives you the freedom to choose whether you give priority to a strong chance of high returns or a low level of risk.


Why we recommend market rate savings (PFA Plus)

Our objective is to make your pension savings grow and thus ensure you the best retirement possible. We strive to meet this objective by investing your money with the purpose of generating top returns.

Pension is closely related to the financial markets, which have changed significantly over the last years - therefore we update our recommendations on an ongoing basis.

Year after year, PFA has generated some of the best returns in the market, and we believe that the market rate return will outperform the return on the traditional average interest rate plans in the long term.

Therefore, we recommend all new customers to opt for market rate savings (PFA Plus), and most existing customers with a traditional average interest rate plan are also recommended to transfer to market rate.

Make your pension even greener with PFA Climate Plus

PFA Climate Plus enables you to place your pension savings in extra climate-friendly investments. From the outset, shares in PFA Climate Plus will emit 60 % less CO2 than the global equity index. The goal is for PFA Climate Plus to become CO2-neutral by 2025 and remove more CO2 from the atmosphere than it emits by 2030. As with the rest of PFA’s investments, in PFA Climate Plus, investments are also selected on the basis of respect for social conditions and corporate governance – collectively referred to as ESG.

4 investment profiles – which one is your match?

Investment Profiles A, B, C and D offer different return potentials and degrees of risk. Profile A comes with the lowest risk and the lowest potential for a high return. Profile D has the greatest possibility of a high return - but also the highest risk.

In all four investment profiles, the money is invested in shares, bonds etc. in two investment funds: the Low-Risk fund (bonds, property, etc.) and the High-Risk fund (shares, alternative investments, etc.)

Log on to My PFA to view your investment profile. Your options depend on the agreement between your employer or organisation and PFA. At My PFA, you can view your specific options.


Investment profile A

25 % of your savings are invested in the High-Risk fund, and the rest is invested in the Low-Risk fund.

The investments in the High-Risk fund will be scaled down to approximately 10 % at the time of retirement.

Profile A is comparable to a traditional pension savings plan in in the average interest rate environment.

In profile A, you can choose an extra safety net by including payout protection cover

Investment profile B

50 % of your savings are invested in the High-Risk fund, and the rest is invested in the Low-Risk fund.

The investments in the High-Risk fund will be scaled down to approximately 20 % at the time of retirement.

In profile B, you can choose an extra safety net by including payout protection cover

Investment profile C

75 % of your savings are invested in the High-Risk fund, and the rest is invested in the Low-Risk fund.

The investments in the High-Risk fund will be scaled down to approximately 30 % at the time of retirement – meaning that, at the time of retirement, profile C is comparable to profile A, which has 25 % in the High-Risk fund and 75 % in the Low-Risk fund before the gradual reduction of risk.

Investment profile D

100 % of your savings are invested in the High-Risk fund.

The investments in the High-Risk fund will be scaled down to approximately 40 % at the time of retirement.  

Built-in security in all profiles

A high return potential means a high risk of loss. Therefore, we have ensured that your pension plan will include a built-in security regardless of whether you have selected investment profile A, B, C or D.

This security means that high-risk investments are gradually reduced as you approach retirement – the closer you get to retirement, the safer investments we will make on your behalf. 
Risk reduction 

PFA recommends investment profile C

People have very different risk appetites, and it is important that the balance between risk and return suits you and your preferences.

As a starting point, we recommend profile C, which we find have the optimum balance between risk and return for most people - among other things, because we automatically adjust the investments according to your age by gradually reducing high-risk investments from 75 % to 30 % as you approach retirement.

That being said, we recognise that choosing an investment profile is a question of temperament as well as it is dependent on your financial situation. This means that profile A or B may be a better option for you if you prefer low risk - and profile D may be your perfect match if you give top priority to high returns.

Typically, the returns generated by the investment profiles will outperform the returns generated in the average interest rate environment. This is because the profiles allow our investors more investment freedom, which in return allows us to generate the best returns possible.

Get a recommendation straight away

A, B, C or D? Which profile is your perfect match? Find out by answering a few simple questions about your return expectations and your risk appetite. All you need to do is log into My PFA and go through the investment guide.


The relationship between risk and return

Investment returns fluctuate from year to year, and both shares and bonds may yield negative returns. Risk and return often go hand in hand, and the greater the risk you are willing to take, the greater the potential for a high return. Typically, shares yield higher returns than bonds, but shares also fluctuate more, which means that they entail a greater risk.



When your pension payout is in process

Your savings plan will remain in the market rate environment – and will keep the same investment profile, when the payout of your pension is in process. Once you have retired, no further gradual reduction will be made of the percentage invested in the High-Risk fund with the present investment profiles.

Having your savings placed in the market rate environment means that your pension may increase or decrease. When your payouts are about to start, we will, as a rule, fix your monthly payout until the end of the year. Hereafter, your pension benefits will generally be adjusted once a year with effect from January in the new year.

The pension benefits will be fixed on the basis of the size of your savings and our principles of payout in force at any time, which among other things include assumptions on expected return (payout rate). If the actual return of the year turns out higher or lower than assumed, the benefits may increase or decrease. Payout of life pension also includes the assumptions of remaining life expectancies, which may be subject to regular changes.

However, it is not only the return and the development in life expectancy that affect fluctuations in the pension benefits expenses, tax etc. enter into it as well. If we change our principles of payout, including the payout rate, this may also impact the size of the benefits.

Payout protection cover provides extra security

Payout protection cover is an extra safety net which ensures that your payouts, as a rule, will not drop below a certain level, irrespective of the development on the financial markets.

If you have investment profile A or B, you will, as a rule, be able to select payout protection cover – however, it depends on the agreement between your employer or organisation and PFA.

Generally, payout protection cover will gradually be phased in from 10 years before the expected time of retirement. It is phased in gradually to ensure that we are still able to invest your savings in a manner that provides you with as much return as possible. The exact level of your payout protection cover will be finally fixed immediately before you retire.

Please note that the phase-in of payout protection cover will imply that your pension benefits are likely to become lower - and in some cases significantly lower. This is due to the fact that the foundation of your payouts is based on our investments in some special funds with only very low risk, which consequently also means low return expectations. 

At My PFA, you can learn more about payout protection cover and find out whether this option is included in your pension plan. You can also see the price of payout protection cover. The detailed conditions on payout protection cover, including in which situations the payout protection cover may be reduced or lapse, will be stated in your terms and conditions of pension. 


Investing your savings yourself

If you have an interest in investments or are an investment professional, you can choose to manage the investment of your savings yourself through You Invest. Then, you can invest your savings in a number of funds which we have selected.

With You Invest, you decide:

  • how large a share of your savings and future payments you want to invest in funds yourself
  • which funds you want to invest in

You can always follow your transactions at My PFA as well as see the trading prices.


Fix your own risk on your pension savings with PFA Optional

PFA Optional is for you with insight and interest in investment. You want to assume your own responsibility for regularly fixing the risk level of your pension savings, but you want to leave the actual investing to PFA.

PFA Optional gives you the following possibilities to invest your pension:

  • You select an intended distribution between the risk funds Low and High
  • PFA Pension will adjust the actual distribution of your selected intended distribution at least twice a year.
  • It is up to you to regularly adjust and adapt your intended risk level in accordance with aspects such as your time of retirement
Your investments – your responsibility

Are you ready to manage the investment of 100 % of your pension savings or part of them? With You Invest, you have full responsibility for investing your savings and making them grow. With PFA Optional, you alone are responsible for the risk level on your savings.

We offer a range of investment tools to help you – including the investment portal FundCollect, where you can find information about the various funds and analyse your options. Please note that we do not offer personalised investment advice.

Not all customers can choose to manage their investments themselves – this option depends on the agreement between your employer or organisation and PFA. At My PFA under ’Investment’, you can see whether this option is available to you.

If You Invest is available to you, the investment guide will advise you on how you best use You Invest.