76% of Swedes invest in funds besides PPM – survey

A full 76% of all adult Swedes are invested in funds in addition to savings made via the Premium Pension (PPM), according to figures published by the Swedish Investment Fund Association.

That ratio is at the same level of two years ago, the Association states in its latest research report into the behaviour of Swedish fund investors aged 18-76. The report, which is published every other year, gathered data from 1,500 responses from people surveyed between January to March by TNS Sifo Prospera.

The proportion of Swedes who are invested in funds hits 100% when savings into funds via PPM is included in the data, the report says. Both ratios are high when compared internationally, the Association added.

However, while the overall use of funds remains, there have been some interesting trend changes since the previous report was published. The proportion of men investing in funds ex-PPM has risen from 75% to 81%. Among women the proportion has fallen, from 77% to 71%.

The Association suggests that the lower participation rate of women may be explained by the older age groups surveyed – where more women have been withdrawing their savings in funds in order to complement lower pension income. That said, fully 83% of women in Sweden aged 43-62 are invested in funds in addition to PPM.

Another significant change is the extent to which the tax wrapper known as investeringssparkonto (ISK) has been taken up. This is a type of savings account that enables investors to put money into funds and enjoy tax benefits. Some 20% of males responding to the survey said they are using ISK, against 14% of women.

Men continue to be greater risk takers, the report suggests, with direct equity investments noted by 36% of men compared to 21% of women.
Overall, Swedes see investments in funds as a way to create a financial buffer (58%) and to save towards a pension (47%).

Tax efficiency is deemed important. Some 55% of those surveyed said they use one of the more tax efficient routes to investing in funds, including unit linked policies and traditional life policies. The Association said that this illustrates that many feel they need to not only build up complementary private pension savings, but also desire some form of stimulus to do so.


Recommendations from a financial intermediary is the most common reason for choosing a particular fund, the research found.

Some 39% of the Swedes surveyed said they had used advice on funds in the past two years. Some 28% said they would consider paying for independent financial advice, rising to 35% in the 18-42 age group.

Choice of funds

Three-quarters, 75%, of investors have equity funds, about 40% have balanced funds, and about 30% have fixed income funds. The most commonly held fund is a Sweden fund – 37% said they had this type of exposure.

A key trend has been towards index funds, with the proportion rising from 11% to 19% of respondents in the past two years.

Investors identified fees and risk levels as the most important factors to consider when deciding funds, but just a quarter of those surveyed knew that fees are always removed when returns are illustrated.


The latest report suggests there are still significant gaps in knowledge among long term savers who appreciate the ability to self-select funds in the PPM system.

Some 52% said that they had self-selected funds in PPM, while 39% said they rely on the system default fund AP7 – although 10% said that it was a conscious choice to use the default fund.

A clear majority, 60%, said that it is good to be able to select funds for part of their pension, while 35% said it would be preferable for the state to take care of everything on their behalf. Younger Swedes seem to appreciate the ability to select more than older Swedes: 70% of those in the 18-42 age bracket said that they felt it was good to have the opportunity to self-select.

However, just 11% of all respondents recognised that they get rebates on fund fees in the PPM system.


To read the full report click here (in Swedish): Fondspararundersökningen 2014 Rapport


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