This is the fashionable savings product. The pension savings (PER), which was launched in October 2019, is in a panic. At the end of June 2022, no less than 70 billion euros had been placed in this envelope, a jackpot distributed among just over six million subscribers. Twice as much as the original target set by Bercy for the end of 2022. And PER does not owe this success to the government’s – massive – communication about this product alone. The reasons for this “cardboard” must be found mainly on the side of the benefits that the pension savings offer. Because if it remains a “tunnel” product where the capital is blocked until retirement – except in special cases – it is much more flexible than its predecessors.
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“The retirement savings plan has been very successful, partly because the amounts are available after you have retired,” explains Gilles Belloir, CEO of placement-direct.fr, an online broker specializing in retirement savings (life insurance, PER). A release – full – in capital, which was simply impossible with its predecessors, such as Perp or Madelin, contracts where “the exit in annuity was a foil”, continues the first guest to the “Grand rendez-vous de l'” savings” ( Capital / Radio Patrimoine). Consequence: The transfers of old pension contracts are legion. In fact, they represent almost 80% of the total number of outstanding PERs. “Many of our customers had old products: an old Perp, an old Article 83 (…). They transferred them to our PER and now pay every year”, confirms Edouard Petitdidier, founder of Family Office Allure Finance and second guest on the show.
The flexibility of PER, which also allows early release for the purchase of the main residence, is not the only reason for its success. How, not to mention the taxation of this product, beneficial in many respects! “The amounts paid into your PER are deducted from your taxable income, giving a tax reduction equal to the product of the amount you pay multiplied by your marginal tax rate,” explains Gilles Belloir. An asset that also allows each year to optimize its taxation by adjusting its payments according to the subscriber’s tax rate: “We look at the customer’s tax rate and, according to this bracket, we decide together with him how much he can put his PER in”, appreciates Edouard Petitdidier. And the icing on the cake, although income tax must be paid upon withdrawal (retirement), the plan holder takes full advantage of free leverage. “A client taxed at 41%, and who places 100 euros in his PER, actually puts only 59 euros there. Until his retirement, he will benefit from an incredible leverage effect (on the balance of 41 euros, which gives interest, ed. note)”, the specialist gives as an example.
Not enough to render life insurance obsolete, which according to Edouard Petitdidier remains “an exceptional support, both in terms of taxation and inheritance rights”.
Retirement, redemption of a PER: how to limit your taxation when declaring income
Performances at rendezvous in 2021
Of course, it is impossible to assess the interest of an investment without addressing its performance. Again, all lights are green for PER. And that for several reasons, including floor costs, according to Gilles Belloir. “On older generations of pension contracts, it was easy to find payment fees of around 5%. Today we can say that it no longer exists, or almost no longer exists on the market”, he rejoices.
Add to these costs reduced by buoyant markets last year and you have an excellent vintage of 2021. This is also the subject of our “report”, where Ludovic Herschlikovitz, founder of retirement.com, presents the time-based management – the standard management mode of a PER. As you’ll see in this order, the best of them exceeded 20% last year, both in retirement savings and in life insurance. The downturn in the markets obliges, the 2022 financial year will be much less encouraging for these two envelopes… Conversely, Private Equity (unlisted) and structured products should allow certain savers who are less risk averse to do well in the game and “not to lose too much in 2022”, hopes Edouard Petitdidier.
Life insurance, retirement savings: the product that pays the most according to your profile
Succession benefits too
Last element dealt with by our guests: the estate. “Taxation seems less attractive on a PER”, suggests Gilles Belloir, as the current reduction scheme is obviously less favorable. But he points out that in the event of death, the survivor benefits from unrivaled taxation, as the capital invested – and therefore exempt from tax during the payouts – is never taxed, as the transfer of inheritance between spouses is not taxed. “As such, PER is extremely effective in protecting the surviving spouse”, says the general manager of placement-direct.fr.
It is therefore up to you to take all these criteria into account in order to make the right choices and fund your retirement with peace of mind. And don’t rely on your tax rate alone, insists Edouard Petitdidier: “You may not have a large amount to block each year on your plan. Be careful, because you have to have enough money to live,” he warns. On a PER, you should invest only what you don’t need right away.And if the availability of your savings is a high priority, it’s life insurance that needs to be approved.
>> Our service – Test our life insurance comparator
Pierre Sabatier’s “Coup de coeur / rant”
As every month, the economist Pierre Sabatier assigns his good and bad points in the “Coup de coeur/coup de gueule” section. The founder of the PrimeView company first of all pays tribute to the “fantastic resilience of our companies”, despite the deteriorating context they face. While caution is in order, our columnist appreciates that their latest earnings announcements meet analysts’ expectations. The expectations are also extremely high. Under these conditions, selectivity is more important than ever, he recalls.
That rant comes back to Chinese stocks, whose descent into hell never seems to want to stop. Judge for yourself: “-32% since the beginning of the year, -62% since February 2021”, laments Pierre Sabatier, for whom “the almost alter ego of the American economy is not yet credible enough to stock investors”.
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The experts’ answers in the “It concerns you” section
In the last part of our program you will find the answers to your questions in the sequence “It concerns you”. Nathalie Couzigou-Suhas, notary in Paris, informs a reader who wants to inherit one of her daughters using her life insurance contract. Charlotte Thameur, Advisory Director at Yomoni, describes the risks you expose yourself to by investing in an SME through a mutual fund for investment in innovation (FCPI). Finally, Stéphane Absolu, associate director at Pyxis Conseil, helps a reader who wants to sell his father’s home to finance his entry into a retirement home and wants to know the conditions that must be met to benefit from a capital gains exemption .