How Life Insurance and Private Pensions Can Prepare Us for Retirement
Automatically translated summary. The full text is available in Romanian.
An information note prepared under the National Financial Education Campaign, implemented by the National Bank of Moldova and Independent Think Tank “Expert-Grup”, explains how life insurance and private pensions can help people secure a comfortable retirement, as states can no longer guarantee a decent pension income.
Life insurance relies on multi-year contracts and mainly covers the risk of death. Depending on the type, it can also protect income, provide financial security and peace of mind, add retirement income and bring tax benefits. The most common types are term (classic), endowment (mixed) and education insurance.
Private pensions are built on monthly contributions to a fund. The accumulated sum, plus investment income, belongs to the participant and passes to legal heirs in case of early death. Occupational schemes are paid by employers. Benefits include a steady, predictable income and tax advantages. The note recommends combining both instruments to diversify and reduce risk. Readers should assess their finances, retirement goals and future expenses, and review contributions and coverage periodically.
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