The impact of accumulative pension policy on welfare of individuals

TL;DR

This paper analyzes how Georgia's mandatory funded pension system affects individual welfare, considering historical context, international comparisons, investment potential, and system challenges to inform policy improvements.

Contribution

It provides a comprehensive assessment of Georgia's pension reform, highlighting the system's impact on well-being and proposing ways to enhance its effectiveness.

Findings

The pension reform influenced individual welfare positively.

Investment potential of pension funds is significant.

System challenges include funding and sustainability issues.

Abstract

Many countries around the world have had to carry out radical reforms periodically in their pension systems. Global experience shows that it is important to optimize the costs of pension and social security systems in order to ensure a decent old age in addition to reducing the pressure on budgetary resources. By Georgia is changing demographic situation, special attention is paid to proper functioning of the pension policy. The pension reform carried out in Georgia in 2019 caused a difference of opinion among experts. This issue in today is conditions does not lose relevance. The presented thesis discusses the impact of the mandatory funded pension system on the well-being of people. Thesis includes the following issues: peculiarities of the formation of pension systems in Georgia. It is presented a small historical excursion in terms of the development of pension systems. In addition, are discussed the international experience of pension systems and comparative analysis in relation to Georgia. This paper specifically focuses on the essence of the mandatory funded pension system and assesses the current situation in terms of investment potential of the resource accumulated in the pension fund. In conclusion, are presented the challenges of this system and the ways of perfection.