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A hybrid tontine system is the most common way to save for your pension in Denmark. It is not regarded as sleazy. The companies that run the schemes, has histo

by hantusk 10y ago

A hybrid tontine system is the most common way to save for your pension in Denmark. It is not regarded as sleazy. The companies that run the schemes, has historically been run by unions, and has historically given good yields on their wealth. The largest company of the type is state-owned and it gets money from an obligatory tax applied to all people working in the country. The system will stop working, if politicians begins to tax these pension funds for infrastructure investment purposes, or the pension funds shifts people to financial products that prioritize individual savings/insurance. This "tontine" system is probably the best investment, in terms of securing a good life after 65 years old, if you are among the survivors.

q5 10y ago
>if you are among the survivors Can you expand on this?
- taejo 10y ago
  The members of the scheme who die relatively young subsidise those who live to an old age: both have paid the same amount in, but the latter draws a pension for a longer time.
  - antihero 10y ago
    And by then it doesn't really matter!
tomp 10y ago
Wait, do the payments actually increase as more people die? If not, it's not a tonine, just regular pension insurance.
- amag 10y ago
  Well, the money invested by the deceased has to go somewhere.. I'm not sure how the system works in Denmark but in Sweden you choose whether to give the remaining pension to your family or to have it split among the other people in the pension fund that also opted for the split.