Last year, the annual amount deposited in life course savings schemes was the lowest since the introduction of the scheme in 2006. Employees deposited 786 million euro, i.e. a decline by 13 percent relative to 2010.
New scheme introduced
The economic crisis partly accounts for the lower amount deposited last year: employees are reluctant to pay into savings schemes. The vitality savings scheme, taking effect on 1 January 2013 will also play a part in this respect. Since 1 January 2012, new participants in life course savings schemes are no longer admitted. Due to the pending changes, the number of new life course savings accounts opened in 2011 was already reduced.
Amounts deposited in and withdrawn from life course savings accounts
More deposits withdrawn
Deposits in life course savings accounts in 2011were the lowest and, with 271 million euro, withdrawals were by far the highest recorded since the introduction of the scheme. This may partly be due to abolishment of the life course savings scheme. After all, small savings accounts had to be closed in 2011 and the amounts outstanding paid out.
The announcement of the introduction of the vitality savings scheme has resulted in a reduction in the number of life course savings schemes in 2011 (accounts or insurances). The number of schemes declined by 4 percent to 302 thousand.
Higher balance in life savings accounts
Despite the fact that the amount deposited in life course savings accounts was lower and the amount withdrawn was higher, the total balance in life course savings accounts has risen by 515 million euro, although the increase was less substantial than in 2010 (679 million euro). The total amount deposited in life course savings accounts by the end of last year had increased by nearly 13 percent to over 4.6 billion euro relative to the preceding year.
The average deposit per account has grown further from 13.1 thousand euro in 2010 to 15.4 thousand euro in 2011. One reason is that withdrawals generally involved small amounts. Another reason is that many participants have continued to deposit money into their savings accounts. If the overall deposit meets certain conditions on 1 January 2012, the life course savings account can be continued.
Deposits in life savings accounts