Recently, three retirement target funds in mainland China have been liquidated, prompting netizens to express their sorrow over the situation by stating, “People haven’t retired yet, but the retirement fund has already been liquidated.”
On June 12th, “Finance World” reported that in the review of the liquidation status of fund products in the first five months of this year, it was surprising to see three retirement target funds bidding an early farewell. These funds are the CCB Principal Retirement Target 2035 Three-Year Holding FOF, the Ping An Retirement Target Date 2045 Five-Year Holding FOF, and the Penghua ChangLe Steady Retirement Target One-Year FOF.
Netizens lamented, “People haven’t retired yet, but the retirement fund has been liquidated.”
“Sina Fund” stated that on May 17th, the Ping An Retirement Target Date 2045 Five-Year Holding FOF released a liquidation report, indicating that the fund triggered the termination clause as stipulated in the fund contract on April 20, 2024, with the net asset value falling below 200 million yuan. The final operational date of the fund contract termination was set for April 20, 2024, and the liquidation process began on April 21, 2024.
Public data shows that as of April 20, 2024, the total return of Ping An Retirement 2045 Five-Year FOF was -17.87%.
The report mentioned that overall, the number of retirement target funds being liquidated this year compared to last year is still not optimistic.
Netizens commented, “This is an insurance product of Ping An Insurance, not the national pension.” “Does this mean that all retirement products of insurance companies have loopholes, and when it’s time for real retirement, even the principal amount is gone?” “Indeed, one sentence to describe it would be a thunderous collapse.”
In addition to retirement funds, pension funds are also being rapidly depleted.
The Chinese Academy of Social Sciences released the “China Pension Actuarial Report 2019-2050,” stating that the accumulated balance of the national urban employee basic pension insurance fund is expected to peak at 6.99 trillion yuan by 2027 and then begin to decline, possibly being depleted by 2035. The report predicts that the current balance of the national urban enterprise employee basic pension insurance fund will begin to decline from 2023, reaching a negative balance of 118.13 billion yuan by 2028, and possibly reaching a negative 11.28 trillion yuan by 2050.
Previously reported:
China’s Economic Deterioration Will Lead to the Exhaustion of Pension Funds.
On May 29, the Wall Street Journal reported that China’s pension system was once a strong solely government project. However, under the pressure of economic downturn, it has become fragmented and weakened.