Pension alarm in Berlin: VZB announces drastic cuts!

Pension alarm in Berlin: VZB announces drastic cuts!

The retirement provision of over 10,000 people in Berlin is facing serious challenges. The reason: The pension fund of the Berlin Dental Association (VZB) is in financial difficulties due to high-risk investments. This reports Mercury.

In recent weeks there have been increasing reports about the precariousness of the financial situation of various pension funds, especially in the area of ​​the medical professions. In addition to the VZB, these also include the Schleswig-Holstein dentist and pharmacist pension scheme and the Lower Saxony Dental Association's pension scheme. Each of these pension funds has recorded significant losses, some of which are reflected in double-digit millions Ruch financial advice.

Causes of the crisis

The causes for the disturbing situation are diverse. High-risk company investments, especially in the insolvent Element Versicherung, as well as risky real estate projects contribute significantly to the financial burden. In addition, the economic challenges caused by the corona pandemic and the war in Ukraine have further negatively influenced the investment climate.

VZB's reserves almost halved between 2021 and 2023. That is why noticeable cuts in pensions and contributions have now been announced. As compulsory insurance for doctors, notaries, tax advisors and pharmacists, these cuts threaten the existence of many of those affected.

Future measures and outlook

The new management of the VZB under Thomas Schieritz has already introduced measures to improve the situation. The administrative committee will be partially replaced and claims for damages against former members of the VZB will be examined. Until the financial situation is clarified, there are currently no new notifications about pension entitlements.

The outlook is turbulent. Cuts in pensions and increases in contributions appear inevitable. Similar problems are also known at other pension funds, such as the Hesse State Medical Association. Although the Association of Professional Pension Institutions (ABV) has established general regulations, there is a lack of strict legal control over compliance with them.

Recommendations for those affected

Members of these pension funds should prepare for possible benefit cuts or contribution increases. Many are already realizing that current economic pressures mean they need to rethink their retirement planning. The public controls of the pension funds are limited; they are only subject to state supervision with varying requirements for regulation.

It is advisable to regularly check the business reports and notifications of your own pension funds. If you are unsure, it is also advisable to consult independent advisors or, if necessary, supplement your private provisions in order to gain more security for your own financial future.