You can build a very decent investment portfolio in a quarter of an hour if you make the second and third pension pillars work for you. With all the information noise around the pension pillars lately, we tend to forget the basics. Instead of pondering whether or not to take out the second pillar money,…
Once in a while a friend, relative or Tuleva member asks me for tips on how to start investing. I tell them what I have already described in the previous chapters: it is wise to start with the second and third pension pillars. I don’t know a more logical tool for saving money – the…
Since you brought your money from the old bank pension fund to an index fund, the return has been much better. You can be satisfied! But what if one day you see a minus instead of growth in your account? Let’s take a closer look at the example of the already familiar Laura. In Chapter…
Do you tend to forget the simple truth that seemingly boring but actually highly leveraged pension funds are the basis of a smart investor’s portfolio? Why did thousands of active people – valued professionals in their fields – come together to form Tuleva Association and go into pensions, the most boring business in the world?!…
Warren Buffett has said that it doesn’t really take much to succeed in investing. You only have to do a very few things right, so long as you don’t do too many things wrong. The 15-minute recipe In the first chapter about Laura, age 25, I gave you a few ideas about what you can…
In the first chapter of the Laura’s Journey to Wealth article series, I described how 25-year-old Laura can use the second and third pension pillars to save a million by her 67th birthday. I have received some thought-provoking feedback. A lot of feedback came from people who were happy to realise from Laura’s example that…
It is said that you have to set aside at least one-fifth of your salary to have a sufficient income in the second half of your adult life, after retirement. The first good news is, it’s easier than you think. The second good news is that you’re pretty likely to make a million if you…
Membership fees are used to develop the Association and to represent the interests of members. The fees of our first members were used to raise the fund’s initial capital, introduce Tuleva to the general public, and make preparations to start the fund, including application for an activity license from the Financial Inspectorate. From this point forward, membership fees will be used for the following activities:
Every euro saved gives a Swede almost a third higher pension than the same amount saved by Estonians. Estonia needs a smarter and measurable pension strategy.
As the first and only association representing pension savers, Tuleva is a credible partner for Ministry of Finance and state legislative bodies. We participate in pension strategy discussions, where next to the officials only banks and insurance companies used to be represented.
We help to make better laws. The laws that protect the people. The laws that maximize our profits from our, not banks’ savings.
We have our first achievements. For example
We do not organise demonstrations or spread random complaints. We are direct, we analyse issues and offer constructive solutions.
Tuleva’s main principle is that people themselves save money for their future, using contemporary technologies and bypassing unnecessary middlemen and costs as much as possible.
Every year, each member who has transferred their second or third pillar to Tuleva pension funds, earns a member bonus. Member bonus is very small at first, but it will grow together with member’s pension assets. Bonus is transferred to your personal capital account at Tuleva. This is your ownership stake in Tuleva capital and this stake can earn you additional profit.
When Tuleva grows, our funds under management grow and we add new products to our offering, then the association will earn profit. The profit is then divided among members, as set in our Articles of Association.
As always with profit from entrepreneurship – this depends how well our venture is doing. The founders are convinced, that the 125-euro joining fee pays for itself many times over. But we do not give promises.
At the end of each year
Every member has a vote on annual general meeting and has a right to elect and be elected to Tuleva’s board of directors and other supervisory bodies. This is the official part and it is very important.
Every day we share our ideas and experience among Tuleva members in our Facebook group, e-mail, phone and working groups. Among our community, there are people who care about the society and have very different skills. Many are ready to take responsibility for ensuring us a better future.
Tuleva team listens very carefully to our members and uses their ideas for making Tuleva better. We are only starting and believe that the power of thousands of smart people can be used for increasing our common good.
Tax benefit is simple: the government pays you back the income tax on your third pillar contributions. Tax benefit applies to contributions that do not exceed 15% of your gross income or 6000 euros, whichever is smaller.
Your maximum contribution amount to third pillar is thus 15% x gross annual income. If your annual income is over 3333 euros per month (gross), then you can contribute to third pillar 6000 euros.
Tax benefit equals 20% x your third pillar contributions.
NB! Your tax benefit cannot be bigger than the income tax you have paid during the year. Thus: if your gross income is less than 614 euros a month, then your maximum contribution is less than 15% of your income. More precisely – your maximum contribution per month is then: gross monthly income x 0.964 – 500.
With less than 519 euro monthly income you are not paying income tax most likely and hence you do not have any tax benefit in contributing to third pillar.
If you know that income is still coming to your account this year, add it yourself.
Please note that all income that reaches your account this year will be included in the calculation for 2021 (if the December salary is received in January, it will be included in the next year’s income calculation).
You can also add income that you plan to declare in the income tax return this year: rental income, interest paid by crowdfunding portals, income from the transfer of securities or other property.
Don’t worry if you don’t know the exact amount of your annual gross income today. Calculate the approximate amount and then find the optimal third pillar money placement with the calculator. If the actual annual income turns out to be higher than expected, your contribution will simply be slightly below the income tax allowance limit. Nothing terrible will happen even if you put a little more than the tax credit limit in the third pillar. The law does not prohibit it – if you exceed the limit, you simply cannot get the income tax back.