IMPACTS OF THE PENSION REFORM ON THE DEFICITS OF VARIABLE CONTRIBUTION PLANS

Abstract

We predict the impacts resulting from changes in the minimum retirement ages of the Pension Reform in a supplementary pension plan, also considering different interest rates. We apply actuarial calculations to primary data, provided by a private pension entity, combined with the rules of a variable contribution plan that offers a minimum pension benefit. Changes made to the ages and the interest rate allowed to compare, and analyze, the amounts required for mathematical reserves to cover the minimum benefit. These amounts foster the undesirable actuarial deficits of pension entities. The analysis of the results showed increases in reserves and post-employment benefits, reducing deficits. Therefore, increases in the minimum ages produce positive financial effects for participants and sponsors of pension plans. In the second stage of the study, the sensitivity analyzes were perfected in an innovative way, aiming to anticipate actions to identify, address and mitigate possible impacts. We understand that the implications found add value to social security research, to the managements carried out in private pension entities and for companies or public entities that sponsor post-employment plans.