Choice of pension profile and mutual fund
The choices you make today can have a big impact on your future. It is therefore important to make the right investment choice for your pension.
Select the pension profile or mutual fund in which your pension will be invested
Your investment options depend on the type of pension account you have
Applies to the own pension account scheme which consists of a defined-contribution pension and a pension capital certificate.
Your pension account through the employer's agreement
Everyone who has a defined-contribution pension gets their own pension account with the employer's pension provider.
Assess your pension profile
A pension profile can consist of different proportions of shares and fixed-income securities, and it is important that you choose what is best for you.
When choosing a pension profile, it’s important to evaluate the proportion of equities. You should think about how much risk you want to take, your expectation of return and how many years it is until you retire. If you still have many years left, you are less exposed to fluctuations in the market as the risk of a high proportion of equities is distributed over a longer period of time. Experience tells us that the market overall will rise in the long run.
Historically, stocks have provided a better return than fixed income securities, but also higher risk. Note that historical returns are no guarantee of future returns.
Down-weighting means reducing the risk in your savings as you approach retirement age. You start with a higher proportion of equities at a young age, and when you get older you get less shares and more fixed-income securities. This is how to avoid having too high a risk in your savings as you approach retirement age.
If you have switched off down-weighting on your pension profile, you can switch it back on at any time in the online bank and in The Spare app under:
Illustration of down-weighting
If you would like more investment opportunities, you can choose Pensjonskonto Flex. It gives you access to a wide selection of pension profiles and competitive mutual funds.
What investment options do I have in Pensjonskonto Flex?
You can choose what is best for you from a wide selection of pension profiles and competitive mutual funds.
If you want to make sustainable choices, you can choose My pension Profile Next Generation. Here, your money is placed in mutual funds with an extra focus on responsible and sustainable investments.
Reduced risk towards retirement age
For those with a pension profile, the proportion of shares is automatically reduced every quarter as you approach retirement age. This is called down-weighting. The money is thus less exposed to fluctuations in the market.
If you have chosen a fund yourself, you get no automatic reduction of risk in your pension savings. If you want automatic down-weighting, you can change to a pension profile. Changing funds in your portfolio can also contribute to risk reduction.
How to reduce risk in pension savings?
1. Change to pension profile
If you want automatic down-weighting, you can change to a pension profile in the online bank and in the Spare app.
2. Change mutual funds
Changing mutual funds in your portfolio can contribute to risk reduction. With Pensjonskonto Flex, you can choose what is best for you from a wide selection of pension profiles and competitive mutual funds.
What should you think about when choosing a mutual fund?
When you are saving for a pension, you must think about how long it is until you have to withdraw your pension when choosing a mutual fund. Different types of mutual funds have different risks and recommended time horizons for saving.
There are three main types of mutual funds: equity funds, fixed-income funds and balanced funds. Which type of mutual fund is right for you depends, in particular, on the desired risk and time horizon. The longer you save, the greater the chances of getting a good return.
Equity fund is a mutual fund where at least 80 per cent of your money is invested in equities. The value of an equity fund will fluctuate, and we therefore recommend a savings period of at least six years.
Fixed-income fund is a mutual fund where your money is invested in fixed-income securities such as bonds and commercial papers. You can consider saving in fixed-income funds if you want a higher return than a bank account and have a savings horizon of 2 years or more.
The Spare app
In Spare, you can see your pension and pension profile. In addition, you can see how much the employer saves you and change the pension profile.
Historical returns are no guarantee of future returns. Future returns will depend, among other things, on market movements, the skill of the Portfolio Manager, the fund’s risk level, as well as administration costs. The return may also be negative as a result of mark-to-market losses.
Own pension account
Everyone who has a defined-contribution pension gets their own pension account
Self-selected solution for pension accounts
Get an overview of what your pension disbursements will be
See how you can save for your pension
Pension savings in mutual funds
Save as much as you want and withdraw the money when you want
Individual pension savings (IPS)
Tied pension savings with deferred taxes
Read more about what a defined-contribution pension is
See the options and choose the pension profile that suits you
Pension capital certificate
Gather all your pension capital certificates in one place
Read more about accrued pension benefits from former employers
Plan your pension
Read more about how you can plan your retirement
Tailor your own pension