Stable or variable pension

If you are a member of the defined contribution (DC) scheme, you will find the accrued amount in your Uniform Pension Overview (UPO). You will also find the amount on the secure website of NN IP, which is the organisation that administers the DC (defined contribution) scheme for our fund.

You can make a preliminary choice fifteen years before your target retirement age (currently 68). You can choose:

• to reduce the risk in the investments; this gives you more certainty, may also result in a lower return (also known as a stable pension), or
• to invest with a higher risk but the chance of a higher return (variable pension).
  You will receive a letter about this from NN IP, which is the organisation that administers the DC (defined contribution) scheme. You can change your choice every year.

You will need to make a final choice about six months before your target retirement age. At that time, you will receive a letter containing a calculation of your pension capital and the benefit that you can expect to receive for a stable pension.

With a stable pension, you know roughly how much you will receive each month for the rest of your life. The capital from the DC scheme is then converted on your retirement date into a fixed amount in our fund (average earnings scheme). The amount will only be increased if we can increase your pension in line with the prices. This depends on our financial position. The amount is only decreased if we need to reduce your pension due to our financial position being poor. We will only do this if there is no other option.

If you do not make a preliminary or final choice within 15 years prior to your target retirement age, we will assume you have opted for a stable pension. In that case we will reduce the risk in your investments. You will need to make a final choice about six months before your target retirement age. You can also opt for a variable pension. You will automatically receive a letter from us.

With a variable pension, the monthly amount you receive is not fixed as your pension capital is still being invested. If the investments perform well, your pension will increase. Your pension may increase more than consumer prices. On the other hand, your pension may be reduced if the investments perform poorly. Your pension capital could be devalued if your investment returns are negative. In this scenario, you do not know the monthly amount you will receive for the rest of your life.

If you opt for a variable pension for your retirement age within 15 years, we take more risk with your investments. You will need to make a final choice about six months before your target retirement age. You can also opt for a stable pension. You will automatically receive a letter from us about this.

• It is possible that your pension will not increase in line with inflation, which depends on the financial position of our fund;

• If our pension fund is performing very poorly, your pension may be reduced.

The amount of your pension benefit may vary depending on the results we achieve with the investments. This means that your pension benefit will increase if the investment returns are good, but could decrease if the investment returns are negative in any year.

A risk profile indicates how much risk a pension or investment fund may take with the capital of the member or investor. The more risk we take, the higher the potential return. You can choose your own risk profile. When you log in to Mijn Pensioen (My Pension) at NN IP, you will be asked a number of questions to determine the risk profile. If you do not make a choice, you will be admitted to the pension fund standard.

We will send you a letter about six months before you retire. At that time, you will be asked to make final decision on what you want to do with your pension.

If you opt for a variable pension, you can make enquiries with an insurance company or a bank. You will then be able to use the pension capital you accrued with us to purchase a variable pension from an insurance company or bank. This is connected to your right to transfer accrued pension rights.

If you opt for a stable pension, our fund will convert your pension capital into a pension benefit from our fund.

The choice you make automatically applies to your partner too.

You can use the Mijn Pensioen website to opt for a stable or a variable pension. On the Mijn Pensioen website, you can use the Investments menu to select your risk profile (for more information, see the question about risk profile). Here we ask you a number of questions to determine your risk profile. Once you have completed the questionnaire we ask few extra questions about investing after the retirement date and how we will reduce your investment risk.

We send you a letter each year giving you the option of using your pension capital from the defined contribution scheme to purchase a pension from the fund's average earnings scheme. More information can be found here.

The DC (defined contribution) scheme is administered by NN IP. This is not the same as the average salary scheme, which is administered by AZL. Of course, both organisations work under the auspices of Pensioenfonds Astellas.

You are always free to change your choice. You can do this by logging in to the secure website of NN IP, which is the organisation that administers the DC (defined contribution) scheme for our fund.

On the secure website of NN IP, you will find lots more information about stable or variable pensions, such as the characteristics of and differences between stable and variable pension benefits.

Please contact us.

Please contact us. Please note: If you need help logging into the secure website of NN IP, please contact NN IP.