Good news: end of recovery plan

The pension fund's rising policy funding ratio has enabled us to end our recovery plan with effect from 1 October 2022. That's good news for your pension in NN CDC Pensioenfonds.

When does a pension fund need to make a recovery plan?

If a pension fund's policy funding ratio falls below the capital level required by law, it needs to draw up a recovery plan. This happened in September 2015 and has been the case ever since.

The required capital level depends on the pension fund's investment mix, and is currently about 121% for NN CDC Pensioenfonds. As at 1 October, the pension fund's policy funding ratio was 122%.

What is a recovery plan?
A recovery plan is a calculation that the pension fund is required to make for the 10 years ahead. Based on the pension fund's terms and conditions, policies and investment mix, the plan must be able to demonstrate that the policy funding ratio will rise above the legally required capital level within the next 10 years. The Dutch central bank (DNB) assesses the plan.

If the pension fund does not expect to restore its funding ratio within the 10-year period, it needs to take measures, such as granting less indexation or, in the worst case, cutting back participants’ pension rights. The latter has never been necessary, fortunately.

What's the benefit of ending the recovery plan?
Ending the recovery plans is good news, because it means the pension fund has restored its legally required buffer. 

Is this also good news for your pension accrual and the indexation of your pension?
It certainly is. Interest rates have gone up in recent months, and this has boosted the pension fund's financial position. That's good for your pension accrual and for the indexation of your pension to keep up with inflation. 

What do you need to do to monitor your financial situation?
According to studies carried out by online platform ‘Money Wise’, around 30% of people over 55 feel they should have started looking into their pension situation a lot sooner. Moreover, 50% of the Dutch have no idea whether their pension is indexed or reduced.

Sound familiar? If so, take the first step towards more insight into your pension:

1. Use the online tool ‘Later goed geregeld’ (in Dutch only) to get quick insight into the amounts of your pension.
2. Would you like to know how much pension you've built up for yourself and your loved ones? Your UPO can help you find out. Here's where you can find the amounts.
3. The pension fund regularly organises the webinars ‘Check your pension’ (for participants younger than 60) and ‘Pension in zicht’ (for participants aged 60 and up) – in Dutch only. Keep an eye on your mailbox, newsletters and the website! 
4. Follow the news on indexation of your pension via our website, our quarterly financial reports and our newsletters.