Experts Warn of Losing Savings in Employee Capital Plans Przepadną Alert
The net asset value accumulated in Employee Capital Plans (PPK) reached 42.60 billion PLN at the end of October. This figure marks a record monthly increase of 1.78 billion PLN. According to the PFR Portal PPK, a participant in the saving program who has contributed since December 2019 and earns 5,300 PLN until the end of 2023, with a monthly salary of 7,000 PLN from the start of 2024, can expect a profit ranging from 138% to 198% by the end of October 2025, based on the type of target date fund selected. The highest average profit was reported for funds with target dates of 2050, 2055, and 2060.
This means the participant’s account balance could be between 11,380 PLN to 16,420 PLN higher than their total contributions. As the holiday season approaches, many individuals are tempted to withdraw part of their savings to cover expenses. However, experts strongly advise against early withdrawals from PPKs.
Potential Risks of Early Withdrawals from Employee Capital Plans
Marta Damm-Świerkocka, a board member of PFR Portal PPK, warned that withdrawing funds prematurely can lead to significant losses. She stated that all government contributions would be forfeited, and 30% of the employer’s contributions would be transferred to ZUS as a pension contribution for the participant. Additionally, participants would incur a 19% capital gains tax, often referred to as the “Belka tax.”
Damm-Świerkocka emphasized considering alternative options such as personal loans for urgent financial needs. Unlike PPK, where one cannot request a partial withdrawal, a total withdrawal would deplete all savings.
The Importance of Employee Capital Plans
According to Damm-Świerkocka, PPK represents more than just accumulated capital; it serves as a financial cushion that provides security during unforeseen events. It ensures full inheritance of funds, thereby safeguarding children’s financial futures. Furthermore, it promotes financial independence and improves the quality of life during retirement.
Oskar Sobolewski, an expert in retirement and labor market issues from HRK Payroll, advocates for a long-term approach to PPK investments. He advises against withdrawing funds for short-term needs, except in serious situations specified by the PPK legislation, such as severe illness.
Conclusion
As the holiday season approaches, it is vital to approach financial decisions regarding Employee Capital Plans carefully. Premature withdrawals can lead to substantial losses, undermining long-term savings goals. Individuals are encouraged to consider the overall benefits of maintaining their investments in PPKs to achieve greater financial security.
