Until July 31, you have to choose: ZUS or OFE


From April 1 to July 31, people registered for retirement insurance should choose between transferring part of the contribution to the account of the Open Pension Fund and leaving the entire contribution to the sub-account of the Social Insurance Institution. Importantly, members of pension funds have a choice on a given issue for the first time. However, time is running out and many people do not know what to follow to make the right choice.

With the arrival of February 3, 2014, as much as 51.5% of assets from OFE to ZUS were transferred. This means that the same percentage of funds of each member accumulated on OFE accounts was deposited on sub-accounts at ZUS. The main purpose of this action was to reduce public debt.

ZUS and OFE - what's the difference?

A person who starts his professional career through a full-time job, internship or running his own business, in most cases starts saving funds for a future retirement pension. The pension system in Poland consists of three pillars, the first two of which are obligatory.

The first pillar - the Social Insurance Institution, which collects the greater part of the pension insurance contribution of each insured person. It amounts to:

  • 12.22% - recorded on the individual account of the insured with ZUS,
  • 4.38% - recorded on the insured's sub-account.

The sub-account differs from the individual account mainly in the way of indexing the contributions. In the case of the former, the indicator is equal to the average annual dynamics of GDP (gross domestic product) according to current prices in the last 5 years preceding the indexation and is published by the President of the Central Statistical Office by May 15. This index is used for the annual indexation which is carried out on June 1 of each year. Additionally, a quarterly adjustment is made on the value of contributions and interest accumulated on the sub-account when calculating the amount of old-age pensions of persons who acquired or will acquire the right to the benefit after the first quarter of 2012 inclusive.

On the other hand, funds accumulated on individual ZUS accounts are indexed according to the indexation index. The premium indexation index is equal to the total consumer price index in the calendar year preceding the indexation date in relation to the previous year increased by the real increase in the sum of written pension insurance contributions in the calendar year preceding the indexation date in relation to the previous year. The premium indexation index may not be lower than the total consumer price index in the calendar year preceding the indexation date in relation to the previous year.

The second pillar - the Open Pension Fund, which collects funds transferred by ZUS in the amount of 2.92% of the basis of assessment. The task of open-end pension funds is not only to collect funds, but to invest them in financial instruments, e.g. on the stock exchange. In this case, it is not easy to identify future profits as they depend on the current market situation.

Third pillar - Individual Retirement Accounts, in relation to which the insured has a free choice. This pillar includes, first of all, employee pension schemes (PPE). There is also the possibility of individual retirement savings by opening an Individual Retirement Account (IKE) or an Individual Retirement Security Account (IKZE), which is a new form of saving available from January 1, 2012. Any person can save in IKE and IKZE, provided they are 16 years of age. However, in the case of IKE, there is a deposit limit, which in 2014 is PLN 11,238.

What other differences can be mentioned between ZUS and OFE? Well, the ZUS sub-account belongs to a state institution and is guaranteed by the state, while the OFE account belongs to private entities, such as Universal Pension Societies (PTE). Contributions transferred to the sub-account may not be reduced, and in the case of OFE funds - they are dependent on market fluctuations, which may cause them to lose their value.

How to choose between ZUS and OFE?

The insured persons faced a choice: ZUS or OFE? The decision consists in choosing whether to transfer the entire contribution (4.38% + 2.92%) to the ZUS sub-account or continue to transfer part of it to the OFE account.

If the insured person decides to continue to transfer part of the contribution to the account of the open-ended pension fund, then it is necessary to submit an appropriate declaration, i.e .:

The print is available for download, among others on the website of the Ministry of Labor and Social Policy, the Social Insurance Institution, the Ministry of Finance and the Polish Financial Supervision Authority. The decision should be delivered to ZUS in person, by traditional mail or via the ePUAP profile.

Attention! Failure to submit the declaration by July 31, 2014 means that the insured person decides to pay the entire premium to the ZUS sub-account.

“Transfer windows” of ZUS and OFE as an opportunity to change the choice

If, after July 31, the insured person decides that he or she made the wrong choice of paying contributions, the opportunity to change his / her decision will only be available in 2016 - in the period from April 1 to July 31.There will be an opportunity to change the previous decision every 4 years in the so-called "Transfer windows". This means nothing more than the introduction of a certain voluntariness in the payment of future contributions to OFE.