NETHERLANDS - A very high proportion of  the new levensloop specialist Careon's  €40m of assets has been paid into a savings account by participants during the first year, its levensloop director Wouter Peters said.

"By saving €36m, our participants are showing they are cautious. But we are expecting a gradual move to investments. Especially since we are offering a free change from saving to investing this year," Peters told IPE.

 Individual participants receive an interest rate of 4% on their savings. The rate for employers' collective schemes is 4.5%.

Careon - launched at 1 January 2006 - is a subsidiary of the €81bn healthcare pension fund PGGM. Its exclusive aim is to offer the tax-friendly levensloop, which allows workers to save 12% of their salary tax-free, and use the balance to finance (taxed!) leave, for specific purposes  such parental, care and education, as well as early retirement.

With returns on real estate and equity of 33% and 15% respectively, Careon has performed according to expectations, Peters said.

However, mainly due to uncertainty about the future of the levensloop, the uptake of the scheme is considerably slower than expected, the director pointed out. "Most other participants in tax-friendly schemes have stuck to the ‘spaarloon' (savings account) as their default scheme."

At the moment, 25,000 healthcare workers and/or their partners are participating in the scheme. "We are very much looking forward to decisions by the new government to make the levensloop more attractive," Peters added.

Nationally, the uptake of the levensloop is around 5%. According to the director, the scheme's 25,000 participants represent approximately 50% of all the participants from the healthcare sector.

Careon offers 18 lifecycle funds, with durations varying from 6 to 40 years. The risks of the investment mix are proportionately decreasing with the duration of the fund.

The 40-years fund has invested 70% in equity, 20% in real estate and 10% in fixed  income, whilst the respective investments of the 6-years plan are 30%, 10% and 60%, Peters pointed out.
The 40-years fund returned 11.4%. The 15-years and 20-years plans returned 10.1% and 10% respectively.