Tuleva’s III Pillar Pension Fund

We constantly improve the range of services offered to our customers and therefore offer to invest in Tuleva's pension funds through Coop Pank's internet and mobile banking. Our aim here is to help people in Estonia save more effectively.

Tuleva shares a lot of our values: both of our companies are Estonian-owned, and we both contribute to promoting the financial well-being of people in the country. Likewise, we both aim to encourage people to think about saving – including those who, for a variety of reasons, have never really given it any thought. Stage 1 of our partnership involves giving Coop clients the chance to start saving in the Tuleva III Pillar Pension Fund via the Coop website.

Further down the line, our partnership will guarantee a win-win-win scenario for Coop Pank, Tuleva and our clients, which is to say we’ll prove that 1+1=3.

Tuleva is an asset management company that takes the form of a cooperative. Its aim is to grow the assets of people in Estonia, creating the best conditions for investing money long-term for anyone wishing to join. Its founders include Tõnu Pekk, Indrek Neivelt, Taavet Hinrikus, Kadi Lambot and other well-known Estonians. Tuleva’s III pillar has already become one of the country’s biggest pension funds. The association’s principles are offering low fees and investing solely in good funds.

Tuleva has introduced modern, low-fee index funds to Estonia. An index fund is an investment fund which seeks to emulate the average market returns by investing proportionally in all (or almost all) of the assets on the market. Index funds constitute a passive form of investment, which means that the fund manager doesn’t actively look to choose shares or other assets that might exceed the average market returns. As a rule, index funds come with low fees.

The II pillar or mandatory funded pension forms part of the pension system. The mandatory funded pension is collected at the rate of 6% of a person’s gross salary: 2% is contributed by the individual themselves, while the other 4% is contributed by the state. These payments are automatically deducted from a person’s salary unless they’ve exited the mandatory funded pension system. Mandatory funded pension assets can be used during a person’s retirement or earlier upon exiting the system.

The III pillar or voluntary funded pension also forms part of the pension system. Payments can be made into the III pillar at times of your choosing, and the money you save in it can be used at any time.

Payments into the III pillar are exempt from income tax up to 15% of your taxable gross income, but no more than €6000 per year.

The funded pension, which is to say the II pillar, is based on pre-financing – when you work in Estonia you save for your retirement yourself by paying 2% of your gross salary into your pension fund. The state adds 4% to this from the 33% social tax paid on your income. These payments are made automatically.

The voluntary funded pension, which is to say the III pillar, is an additional way of saving in which you decide on the frequency and amount of contributions yourself, as well as on how you make them. Anyone can transfer up to 15% of their gross income (no more than €6000 per year) to their III pillar tax-free.