Russia's Government Commission on Legislation has approved a bill converting the accrued pension savings component into the Long-Term Savings Program (LTSP), set to take effect on April 1, 2027. The accrued pension component was funded by employer contributions from 2002 to 2014, after which mandatory contributions shifted to insurance pensions. Voluntary contributions remained rare, with only 28,400 people contributing voluntarily in 2024.
Under the reform, citizens gain access to flexible payout schedules, tax deductions, inheritance of investments, and state co-financing of up to 36,000 rubles annually for ten years. Funds can also be accessed in emergency situations, such as the loss of a breadwinner or costly medical treatment. The Ministry of Finance emphasized that the program offers various benefits for citizens.
The Ministry of Finance noted that pension savings converted into the LTSP will continue to be invested on conservative investment principles by VEB.RF, with funds overseen by a newly established National Welfare Fund (NWF). The reform does not affect insured pensions or the accounting of pension points and tenure. The Ministry of Finance highlighted that the Long-Term Savings Program has proven effective as a savings tool for citizens.
RF, with funds overseen by a newly established National Welfare Fund (NWF).