More Than Just a Pension Plan: Innovative Financial Security as a Benefit
Let’s be honest: Finding great employees isn’t getting any easier. That’s why it’s crucial to offer your team more than just the usual corporate perks like employee discounts, fuel vouchers, or free fruit baskets. One key benefit that’s gaining traction? Company pension plans (bAV)—and for good reason. While only about 47% of employees in Germanycurrently take advantage of bAV, interest is growing steadily. For companies, bAV isn’t just a way to boost employer attractiveness—it also reduces turnover and strengthens long-term employee retention through sustainable financial security. Let’s explore how you can make the most of it.
Company Pension Plans, Made Simple
At its core, bAV helps your team build additional retirement savings—with your support as an employer. The good news? You also benefit from tax advantages along the way. There are five ways to implement bAV:
- Direct insurance – A classic pension insurance plan taken out by the employer for the employee. Managed by an insurer, it involves limited returns and high sales commissions, making it less attractive.
- Pension funds – Similar to direct insurance but with stricter regulations and less flexibility.
- Support funds – Designed for higher incomes, offering tax benefits but requiring more administrative effort.
- Pension funds (Pensionsfonds) – The most modern and flexible solution. These funds invest directly in capital markets (e.g., ETFs), enabling higher long-term returns with transparent costs—and without the risk of outliving your savings.
- Direct commitment (Pensionszusage) – Employers guarantee a company pension but must finance it themselves—bearing all financial risks.
How Companies Can Prepare for bAV
- Get informed & seek advice – Which model is the best fit for your company? Experts can help find the right solution.
- Involve employees – Transparent communication and training foster trust and participation.
- Go digital – Smart platforms simplify administration and improve efficiency.
Why Now Is the Best Time to Make the Switch
A recent study by the Institute for Pension and Financial Planning (IVFP) found that 70% of employees expect employers to support them in preparing for retirement. At the same time, traditional pension models are delivering ever-lower returns—often below the inflation rate. Companies that act now can gain a competitive edge by switching to modern, market-based solutions like pension funds, offering their employees sustainable and high-yield financial security.
The Future of bAV and Employee Benefits
Traditional pension insurance is becoming outdated—high costs, low flexibility, and weak returns are common issues. Instead, more and more companies are turning to pension funds to provide exactly what both employers and employees need: a modern, transparent, and high-yield retirement plan. Forward-thinking companies should move away from outdated structures and embrace the advantages of direct capital market investment. Germany needs to shift from legacy insurance models to modern, return-driven solutions.
By switching to pension funds today, you’re securing your employees’ future—and giving your company a real competitive advantage.
Want to learn more about bAV, employee benefits, and a seamless solution for employee retention? Let’s talk—book your consultation with HelloBonnie today!
Source: Deutsches Institut für Altersvorsorge
