The eter­nal bat­tle against time

"What New Year's resolution did you make?"

The first workday of the new year invariably involves the same question by the coffee machine. I always struggle with this question because I make the same resolutions year after year and therefore seem terribly unexciting. The reason isn't that the goals aren't achieved and thus need to be repeated the following year, but rather that fundamentally, I always want to maintain and emphasize the same things. Good physical and mental health, positive and constructive relationships with friends and family, and long-term financial health. Upon closer inspection, these goals all aim at the same thing: enjoyable and fulfilling retirement years. I'm nearly thirty years away from retirement age, so it might seem odd to focus on that time, but good long-term goals can also support the present day—one doesn't exclude the other. Thinking about your pension fund is both a long-term goal and interesting in the shorter term.

Increased Interest

In recent years, we've seen increased interest in investments, manifested in significantly greater participation and interest from ordinary investors in the stock market. This development is very positive and indicates increased discussion and knowledge in society. Pension funds are also participants in that market, and increased interest in investments should therefore encourage greater interest in pension funds. It's important to remember that the average investor's largest savings typically lie in their pension fund, where the equivalent of two monthly salaries flows annually. Pension fund investments have widespread effects—they invest in listed markets, the same ones people have been paying increased attention to in recent periods. Pension funds also invest in interesting unlisted projects, infrastructure investments, and innovation, to name a few, which are exciting to follow while such investments drive a vibrant and powerful economy. We also know that investments and where they're directed can have considerable impact on the future we're shaping, both regarding environmental and social issues, making it important that we're aware of where our largest savings lie and what impact they have.

Accessing Information

What is my current position, and how do my retirement years look based on unchanged priorities? Is the interplay between private pension savings and collective insurance as I want it to be? What is my pension fund investing in, what is the fund's investment policy and responsible investment strategy, and what has the return been? All these are things worth reviewing annually and ideal to include as a yearly New Year's resolution.

Information about your own position can be accessed through the pension portal and on your pension fund's personal pages or app for those funds that offer one. Pension and private pension funds each publish detailed information on their websites about investment policies, returns, and investments. Different proportions of stocks and bonds as well as foreign assets, to name a few. The funds also have responsible investment policies with different emphases that are interesting to explore. Both the Financial Supervisory Authority and the Icelandic Pension Funds Association compile thorough information about returns, investments, and performance of pension funds that are suitable for comparison.

The Annual New Year's Resolution

Setting the same goal year after year doesn't mean the goal wasn't achieved the previous year, but rather that it's about lifestyle and stability. Setting a goal for 2024 and all the years to come to monitor your pension savings demonstrates a conscious strategy in life. Following your largest savings, knowing how it's allocated, where the returns come from, and how the savings impact both your own life, the business community, and society as a whole.