All three developments provide a great opportunity for global employers to support local employees on pensions decision making. This is also an opportunity to test out those global financial wellbeing policies and to help employees achieve better retirement outcomes!
🇨🇴 Colombia:
– New Pension reforms take effect on 1 July 2025.
– Employees earning 2.3 times the National Minimum Wage (approx US$9,000) will have to pay contributions to a private AFP fund of their choice.
– All individuals will have to pay contributions to the state pension fund.
🇨🇳 China:
– A new voluntary private pensions system was rolled out in December 2024.
– Retirement ages will also increase by 3-5 years over the next 15 years.
– These changes provide more pension options for employees in China and should help to improve incomes at retirement.
🇨🇿 Czech Republic:
– Positive steps in Czech Republic. For some time, we have thought that much more can be done to provide better pensions to employees in the Czech Republic: a country with many international employers and global retailers.
– The voluntary system appears to be one of the most tax effective for low earners in Europe but is less well used. OECD data shows that less than 25% of employees receive employer contributions to their pension plan.
– The Czech Finance Ministry has announced potential plans for employers to pay a 4% pension contribution to workers in ‘demanding’ professions. This could be implemented later on in 2025. See:
https://lnkd.in/e72wqCKs