210 000 individual retirement savings plans (PER) were opened in less than a year, according to the French Insurance Federation (FFA) count at the end of June. And the craze is accelerating in this fall 2020, in the wake of the first candle of the PER, blown on October 1, but also because the end of the year is systematically synonymous with the quest for tax exemption products. for taxpayers.
1. Do you really need a PER?
Do not be blinded by commercial speeches or by the name of the product: the retirement savings plan is primarily a tax exemption investment. Each payment you make reduces your taxable income. Of course, you can waive this tax deduction, but in this case life insurance is a similar and less restrictive retirement savings tool. Nothing prevents you from withdrawing money on life insurance, while only an accident of life (over-indebtedness, disability, end of unemployment rights …) or the purchase of a main residence will allow you to unlock PER money before retirement.
To sum up: the more taxes you pay, the more the PER will be an interesting product, in order to prepare your old age while reducing your tax.
2. Have you gauged the level of costs of the PER?
When you put € 1,000 into a PER, you actually only invest € 975. Why ? Because the level of entry fees, these fees punctured by the bank or the insurer with each payment, is on average 2.5% according to a study of 60 million consumers, which peeled the general conditions of 26 plans of ‘pension saving. The magazine of the National Institute of Consumption (INC) advises to compare and negotiate these fees “Unjustifiable”. And to keep a close eye on the level of management fees, an inevitable line of fees but which is limited to 0.6% or even 0.5% on the least loaded contracts.
“It is the plans marketed by online brokers that we believe deserve the greatest attention”, judges the magazine 60 million consumers. PERs of online brokers have in fact the common point of posting 0% payment fees.
3. Do you need help managing this PER?
The vast majority of individual PERs, opened at the initiative of the saver unlike company PERs, have a financial structure that closely resembles that of life insurance: a secure medium (the fund in euros, on which the capital is guaranteed) and multiple risky investment vehicles (known as “unit-linked”, or UA). However, given the very low level of interest on funds in euros (1.46% on average in 2019 and probably 1% to 1.10% in 2020), investing all your savings in the secure fund would be counterproductive from a perspective distant preparation for retirement. By definition, UC supports are yo-yo: on average -8.9% in 2018 then + 13.1% in 2019 according to the FFA. But over the long term, these risky supports beat the euro fund.
It remains to decide how to bet on these UC supports, without taking too much risk and without forgetting to secure your savings as you approach retirement. This is the reason why the regulations oblige the managers of PER to offer you a “Horizon-driven management”, with progressive securing of your assets. You can either opt for this default option, or for a more high-end management mandate available on certain PERs, or you can deliberately choose to manage yourself in “Free management” if you are familiar with the basics of financial investing.
Despite everything, are you disappointed with your choice of PER? Good news: nothing prevents you from opening several, then transferring your savings to the best of your PER. If you wait 5 years after opening the plan, then the law prohibits transfer fees.
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