How to spend maternity capital on your mother's pension in 2021

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Maternal capital

Family capital is conceived as an element of material support for families with children and stimulating the birth rate in the country. Today, it has a wide range of possible applications, from improving living conditions to increasing the mother’s future pension.

In the article, we will consider how to realize the possibility of transferring maternity capital into a future pension, what their future fate is, and whether it is worth doing it at all.

4 Pros and cons of such a translation

5 Useful video

Pros and cons of transferring MSK to mother's pension

This method of spending funds has its positive and negative sides.

Improving your financial situation after retirement.
Money additionally paid to the owner of the MSK can be used to purchase medications and receive medical services.
Funds in the savings component can be passed on by inheritance. If a woman dies, her children and spouse will receive the money.
If necessary, the mother can change the direction of spending maternity capital.

Pros and cons
Improved financial situation after retirement.

Money additionally paid to the owner of the MSK can be used to purchase medications and receive medical services.

Funds in the savings component can be passed on by inheritance. If a woman dies, her children and spouse will receive the money.

If necessary, the mother can change the direction of spending maternity capital.

Before reaching retirement age, funds may depreciate. If you invest your capital in real estate or education, the return (benefits) may be greater.

The pension system in Russia is subject to constant adjustments. This reduces the level of confidence that the citizen will receive the money.

This method of using maternal family capital is much less popular among certificate owners than, for example, improving living conditions. But it is worth familiarizing yourself with the intricacies and features of the procedure, since in the long term, this option for disposing of the funds of the MSK certificate will help to pleasantly improve the quality of life of a parent in old age.

conclusions

From a mathematical point of view, transferring maternal capital to retirement is beneficial. This will allow you to count on increased government payments in old age and a comfortable old age. On the other hand, such use of maternal capital is extremely unpopular. This is primarily due to the unstable economic situation in the country and the long waiting period for payments. In addition, most Russian families are in too much need of improved housing conditions and help paying for their children’s education to put off financial assistance for 20-30 years.

How does the accumulative component affect payments?

As a result of the reforms carried out by the government, the amount of future state support for a citizen of the Russian Federation after retirement began to depend on the following types of contributions:

insurance;
accumulative;
voluntary.

To form the cumulative component of future old-age payments, a citizen of the Russian Federation will need to make voluntary contributions to the Pension Fund. It is possible to increase their amount through government co-financing or the use of maternal capital funds.

How it works

Let's try to find out how profitable it is to invest maternity capital in a future pension? It should be taken into account that not everyone who has received a certificate needs to improve their living conditions or allocate money for their children’s education. Funds can be sent to the Pension Fund. This may be all funds of the maternal capital or only part of it.

After the pension reform in 2002, the future pension of Russians began to be formed from three parts:

basic;
insurance;
cumulative.

The size of the pension began to largely depend on how many contributions were received into the personal account of the future pensioner. The savings part can be stored in the Pension Fund and non-state pension fund (NPF). A pensioner can dispose of this part much more freely. But the insurance part of the pension cannot be transferred to a non-state fund.

The funded part of the pension can be increased at the expense of maternity capital. Let's calculate how much it can increase. Let's take the following as initial numbers:

investments in the funded part of the pension of a share of maternity capital of 200 thousand rubles ;
Mother's retirement is due in 11 years;
Let us assume that the return on the non-state fund chosen by the mother is 8%.

Having made the calculations, adding every year 8 percent of the investments in the funded part, we get after 11 years an amount that exceeds the original by more than 2 times - 466,327.5 rubles . Note that these figures are greater than the amount of maternity capital today. If with such an investment ( 200 thousand rubles ) it will be 20 years until retirement, then the account will have almost a million ( 932 thousand rubles ).

After retirement, you can opt for immediate payments (payment in equal installments over a certain period of time). If the application is made for 5 years, then the monthly supplement to the pension will be 7772.1 rubles per month (466,327.5: 60 months (5 years) = 7772.1).

The mother can transfer all pension savings accumulated in the account to any other fund. This can be done before reaching retirement age, 55, by filling out an application. You can transfer money no more than once a year.

How to receive certificate funds in the form of a pension

There are several ways to obtain maternity capital aimed at old-age payments to provide for the mother. You can choose one of them:

The funded part can be received as an addition to the basic payment during the survival period. It is established at the legislative level and is 240 months. To calculate the amount of the additional payment, it is enough to divide the amount allocated for the formation of a funded pension by a given period.
The duration of payments can be set by the owner of the MSK, but not less than 10 years. This method of receiving money from maternal capital is called urgent.
You can receive the entire amount in a one-time payment, but this is only permissible in cases where the value of the cumulative component does not exceed 5% of the total amount of maintenance.

The right to receive the funded portion arises for a woman upon reaching the age of retirement. But due to its gradual increase, legislators have provided for the possibility of receiving the funded part of the pension after turning 55 years old.

Advantages and disadvantages of funded pension

So, the funded part can significantly affect the final amount of the pension. But, despite this, we should not forget about the disadvantages:

the state does not guarantee indexation;
You may end up at a loss from such an investment.

It would be fair to highlight the positive aspects separately :

their owner can manage his savings himself by choosing any insurer he likes;
the pension can be inherited by the legal successor of the owner of the MK (as for maternity capital, it can be inherited either by the father (natural or adopted) or by the child himself)).

When choosing a way to implement maternity capital, many doubt it. After all, it is impossible to withdraw money from the savings part according to the law (FZ-424). This means that this also applies to MK. In fact, this conclusion is incorrect. In the case of maternity capital, an exception has been made.

Note! After MK funds have been allocated to the funded part of the pension, they can be redirected to other purposes permitted by law (improving housing conditions, purchasing medical equipment for the rehabilitation of disabled people, etc.). But there is one limitation. This must be done before retirement age.

How will your pension increase due to MSK?

Upon reaching retirement age, a citizen of the Russian Federation can count on receiving government benefits. If she previously allocated maternity capital to a funded pension and preferred the urgent method of receiving payments, then the increase will be: 483,881 rubles / 120 months = 3,888 rubles.

If the mother preferred payments of an indefinite nature, then the amount of the monthly bonus will be less, but the duration of payments will increase. In this case, maternity capital is transferred in parts during the survival period established at the legislative level. Currently it is 240 months . Thus, the amount of the monthly increase will be: 483,881 rubles. / 240 months = 1,944 rubles.

How to transfer maternity capital to the mother's future pension account

If a family does not have housing or other problems, then the choice of investment is most often not so simple. The main argument in favor of registering maternity capital for the mother’s pension may be the following. Since maternity capital has not been indexed for 3 years, pension transfers could protect it from complete depreciation. Above are calculations of how it can increase, not counting investment opportunities.

You can transfer funds in 2021 only after the child turns 3 years old. After this age has been reached, the child’s mother must send an application to the Pension Fund office at her place of residence. If circumstances change, you can change your mind and write a new application.

The funded part is funds that the pensioner himself can manage as follows:

One-time payment. That is, all the money is paid at once only if it amounts to no more than 5% of the insurance portion of the pension.
Urgent payment. This is the issuance of certain amounts monthly for a certain period of time (10 years or more), chosen by the applicant himself. All funds in the account are divided into equal monthly payments. A special feature of urgent payment is the possibility of inheriting the part that has not yet been paid.
Like a regular pension. The entire amount is paid from the time of retirement for life.

Those who have a certificate need to remember that they have the right to influence the formation of a pension (the funded part of it). In order to be able to invest funds correctly, you can check the profitability of a particular fund using the Internet. If you are not sure of the reliability of the insurer, then, according to the law, you change it without loss of income.

If the mother is already retired, then she receives only funds transferred to the funded pension account without any possible income. In all other respects, she has the right to dispose of money in the same ways.

Is it possible to increase profitability using non-state pension funds?

The parent has the right to independently choose a NPF (non-state pension fund) or a management company. The money can also be returned to the Pension Fund or sent to another fund. It can be changed no more than once every 12 months.

To transfer funds to a non-state pension fund, the owner of the MSK will require the following actions:

Sign an agreement with the NPF on the transfer of the funded component of future payments.
Send 2 applications to the Pension Fund (on transfer to a non-state pension fund and disposal of maternal capital, indicating the method of spending it on a funded pension).

If a woman has already transferred to a non-state pension fund, then to transfer MK funds it is enough to contact the Pension Fund of the Russian Federation with an application for the transfer of maternity capital. By investing in non-state pension funds, you can significantly increase the amount of future government support. But, if the NPF has no profitability for a long time, then you won’t have to count on an increase in payments.

Deadline for transferring maternity capital to third parties

For transactions with financial assistance, agreements on the purchase or provision of services between the owner of maternity capital and a third party will be required.

An application for the transfer of funds and a copy of the agreement are provided to the Pension Fund. Pension Fund employees are given a maximum of one month to consider the issue.

The period within which the money will reach the final recipient is ten days from the date of approval of the application.

This will allow you to calculate the transfer time in each individual case of using financial assistance.

Find out more about the deadlines for transferring maternity capital.

Possible size of future pension

Its value will depend on four components - the pension accrued by the state depending on the length of service and available earnings, the amount of MSK transferred to the funded part of the provision, average profitability and the number of years remaining until retirement. The latter value depends on the chosen non-state pension fund or management company, especially since the percentage of return can vary annually, taking into account inflation and other circumstances.

Let's give an example: My mother decided to transfer part of her monthly allowance in the amount of 250 thousand rubles to the funded part of her pension. At the time of writing the statement, she was 35 years old. Retirement is envisaged at 55 years of age. The annual return is assumed to be 8.4% . The calculation formula is:

∑ – amount of MSC for mother’s pension.
t- investment period
D – possible accumulated pension.
∑ x (1 + 0.084)t = D, that is, 250,000 x (1 + 0.084)20 = 1,254,658.85 rubles.

It is assumed that the pension will be increased almost 5 times in 20 years. If it is distributed over 240 months , then the monthly increase in the basic pension payment will be 5,227 rubles.

What needs to be done to transfer MK to mom’s pension

Let's take a closer look at how to use maternity capital for your mother's pension. If she decides to increase her pension with MK funds, she needs to come to the Pension Fund and write an application there. You will first need to collect a certain package of documents.

Due to the fact that this method of selling maternity capital is very long-term, you need to carefully approach the choice of fund and decide for yourself whether it will be a state or non-state institution. This is perhaps the most important decision.

If everything goes well, income from investments will significantly increase the initial funds of MK. Typically, investment returns significantly exceed inflation. Information about the profitability of a particular non-state pension fund can always be found on the Internet.

If after some time the owner of maternity capital wants to redirect it (in whole or in part) along with the profit received to other areas, you need to notify the Pension Fund of your decision. To do this, a written application is sent to the Pension Fund according to territorial affiliation, informing about the desire to refuse the assignment of MK.

Early retirement for mothers with many children

A woman who has raised 5 or more children will be able to retire at the age of 50. To obtain this right, the following conditions must be met:

You need to raise at least 5 children under 8 years old.
Collect the minimum required number of pension points.
Have 15 years of insurance experience.

Women who have raised three children will be able to retire early at the age of 57. If there are 4 children in a family, then the mother will be able to receive old-age benefits from the age of 56. Time spent on maternity leave for up to 1.5 years is counted as length of service. This period is also taken into account when calculating pension points. If there are 3 children in the family, then the length of service includes a period of up to 4.5 years, if 4 – 6 years.

Features of assignment and transfer of funds

Only the woman herself can send the funds received under the certificate to the Pension Fund. This is her personal decision and she alone is entrusted with managing the money. You can use this right when the child turns 3 years old.

No one from the family (husband, parents, adult children) can re-receive the capital or enjoy benefits under the program if the woman, for various reasons, has lost the right to the certificate.

Only the mother can also use the entire amount of savings or the part permitted by law.

The only way to transfer non-cash funds indicated in the certificate and cash out the money is to use it to increase the amount of your old-age pension. When a woman reaches 60 years old, she will be given maternity capital money as an addition to the funds accrued based on her length of service.

Significant advantages of transferring money to the Pension Fund:

increase in old-age pension (at retirement);
growth of maternal capital through investment;
compensation for insurance premiums lost during the period of child care (1.5, 3 years).

However, even such positive aspects do not convince women. Nobody really knows how it works. You can check how much the income of a future pensioner will increase after at least 15-20 years, since a woman gives birth to her second and subsequent child no later than 40 years old, and according to the new (from 2021) law, she can retire at the age of 60. What will happen to maternity capital over the years and whether there is a guarantee of its preservation is unknown.

What benefits are there for women upon retirement?

Russian legislation provides for the following types of benefits:

If a woman has 37 years of experience, she can retire 2 years faster, but not earlier than 55 years of age.
Women who have worked for at least 7.5 years in hazardous working conditions (list No. 1) will be able to retire to their well-deserved retirement at the age of 45.
After working at least 10 years in a job with difficult working conditions (list No. 2), you can retire to a well-deserved retirement at the age of 50.
If, upon retirement, a woman cannot confirm the presence of high earnings or significant work experience before 2002, then the period during which she cared for children up to 1.5 years can be counted in her total work experience. It is also possible to exclude it from the length of service, replacing it with pension points.
Mothers and widows of military personnel and cosmonauts who died in the line of duty can receive 2 pensions: their own old-age pension and the one for the deceased breadwinner.
Spouses of military personnel living in military camps without employment opportunities and wives of diplomats living outside the country can also count on these periods being included in their work experience.

To receive the benefit, it is enough to come to the Pension Fund office at your place of registration. You will need to have a civil passport, SNILS and documentation confirming your right to the benefit.

❗ Is it possible to return funds if a woman changes her mind

A woman who previously decided to use maternity capital funds to increase her pension may later change her mind and choose a different way to spend them. For example, to improve housing conditions or pay off a mortgage. That is, a woman does not need to worry that if her life circumstances change, she will not be able to use the money in the future in any other way than by increasing her pension .

To do this, an application for refusal to transfer money from maternal capital for the formation of pension payments is submitted to the territorial division of the Pension Fund.

The application form for refusal to use maternity capital funds for the formation of pension payments can be downloaded here.

The main thing is that the woman completes the submission of the application before her pension is awarded.

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Registration of the funded part of the pension

The procedure for transferring maternity capital to the formation of state support for the mother consists of several steps:

Collection of necessary documentation.
Filling out an application for disposal of certificate funds. The form of the form is established at the legislative level. You can fill it out yourself by downloading it from the Internet, or at the place where you submit the documentation.
Transfer of documentation to the Pension Fund branch at the place of registration or residence. The certificate holder can do this independently or through a representative.

After studying the request and the documentation attached to it, the authorized specialist of the Pension Fund of Russia makes a decision to satisfy or reject the request. The applicant is notified of the results of the decision in the manner specified in the application.

How can I send documents?

In order to direct all or part of the maternity capital to the future state support of the mother, you do not need to collect many documents. It is enough to prepare the following evidence:

MSK certificate;
passport;
SNILS of the certificate owner.

If the interests of the applicant are represented by another person, then his powers must be confirmed by a power of attorney certified by a notary. The representative will need to have a civil passport with him.

Writing an application

The application form can be obtained and filled out from the government agency or. The application contains the following information:

Information about the certificate for receiving state support.
Full name and passport details of the applicant.
Full name and details of the child's birth certificate of the child who gave the right to receive the certificate.
Information about the representative, if he submits documentation instead of the owner of the MSK.
Intention to use maternity capital funds for your pension provision.
The amount of money allocated for old age benefits.
No restrictions on parental rights.
The application ends with the date of preparation and the signature of the owner of the MSK.

Legislators gave the government agency 1 month to review the documentation and make a decision. After this period, the applicant is notified of the decision made.

Transfer of documentation to the Pension Fund of Russia

In order to direct maternity capital funds to increase old-age pension payments, the owner of the MSK will need to submit an application with a package of documentation to the Pension Fund of Russia branch. You can do this in the following ways:

Bring documents to the Pension Fund yourself.
Use your Personal Account on the official PFR resource.
Submit the papers to the MFC.

If a citizen of the Russian Federation has left the country for permanent residence and does not have a permanent residence permit in the Russian Federation, then you can send maternity capital money to pension provision by contacting the Pension Fund of Moscow. The office is located at: st. Anokhina, bldg. 20A.

What documents, where to apply

You can prepare documents in 3 different ways:

At the Pension Fund office. The application is filled out on a special form and, together with other documents, is submitted to an employee of the Pension Fund of the Russian Federation. It usually indicates the personal data of the mother and child (after whose birth the right to maternity capital became available), the direction to which the money should be transferred and the amount.
You can submit an application electronically through the official website of the Pension Fund or State Services. It should be borne in mind that you will still have to pay a visit to the office of the Pension Fund of the Russian Federation. The data specified in the application form must be confirmed using documents (not only copies, but also originals are provided). In order to save time, you can make an appointment in advance through the website of the Pension Fund of the Russian Federation (special function).
MFC (multifunctional center). Provides the same opportunities for submitting documents. Many people prefer to complete the paperwork this way, due to the simplified procedure based on the “one-window” principle. The application and documents verified by a specialist are processed and transferred to the Pension Fund, through which an official response is given.

The package of documents contains:

passport;
certificate and copy;
green pension insurance certificate indicating the personal account number;
statement.

statements on the disposal of funds (part of the funds) of maternal (family) capital (.rtf)

Previously, documents were reviewed within a month, then a month for transfer. Now the terms of transfer are significantly (3 times) reduced and amount to 10 days. In total, the review and transfer of money will not exceed one and a half months.

Documents for registration of maternity capital for pension

It is easy to arrange. Basic documents required:

application from the certificate holder , a standard form issued by employees of the local Pension Fund, drawn up at the place of registration or residence;
certificate for receiving “capital”;
insurance certificate for pension insurance for the certificate holder;
passport;
children's birth certificate.

Sometimes, instead of the mother, relatives can handle the registration. Then they need to have the application form certified, preferably by a notary. The guarantor provides a passport and certificate.

Is it possible to withdraw from invested funds for retirement?

Some are afraid to invest funds from the received “capital” towards a future pension, in view of the fact that plans will suddenly change and the funds will be needed for other needs. There is no need to be afraid, the decision of such actions is not final. If something changes in life, funds can be redirected . The main condition is that the age does not reach retirement age .

To refuse, you will need a statement from the certificate owner. Documents are submitted to the Pension Fund. The review process takes approximately a week. If the request is considered positively, the money will be returned within five to thirty days.

There are cases when the Pension Fund refuses citizens. There are several reasons.

The capital was not used to create a pension.
The application from the certificate owner was granted earlier.
At the time of submitting the application, the amount indicated is more than indicated in the fund.
The person has reached retirement age and is already receiving monthly payments.

In other situations, money is returned quickly, upon request.

Can a father use maternity capital for his pension?

The legislation states that sometimes a certificate is issued to the father or adoptive parent of the child. He can use it for all proposals, except for the formation of a pension . The reason is that such an offer for mothers was made due to the fact that when caring for a child of 1.5-3 years, the mother loses her work experience.

In other cases, the father can use the money to improve housing, treatment and rehabilitation of a child with a disability, and further full-time education of the children.