- Solid performance despite a volatile environment: The annual return on occupational pension funds in 2025 ranged from 1.62% to 4.78%. Even small differences in returns lead to significant variations in the final capital over the long term.
- Invested assets continue to grow: The capital under management of domestic pension funds had grown to €23.7 billion by the end of 2025. In the previous year, the figure was €21.3 billion.
- Fewer providers than in previous years: Following the integration of fair-finance into the BONUS pension fund, seven providers remain active in the market. BONUS is thus the third-largest player after VBV and Valida.
Many companies underestimate the impact of their choice of pension fund, yet it is a key component of financial security in retirement. Against this backdrop, the GrECo Health & Benefits team in Austria is once again analysing the performance of occupational pension funds in Austria this year.
“Year after year, the differences between providers appear marginal. Yet, over decades, they add up to real added value in retirement savings. It is important to note that anyone planning to switch should take action by 30 June 2026 so that the new provider takes effect on 1 January 2027,” explains Joachim Schuller, Health & Benefits expert and author of the study.
2025: A challenging year for the market with solid performance
The past year was characterised by uncertainty and volatility in the capital markets. Nevertheless, Austria’s occupational pension funds once again delivered a solid performance given the current conditions. With annual returns ranging from 1.62% to 4.78%, the market demonstrated its stability despite difficult conditions, thereby continuing the positive trend of previous years. This development was supported by generally robust capital markets and gradual cuts in key interest rates over the course of the year. Assets under management also continued to rise: as at 31 December 2025, the invested capital of domestic pension funds stood at €23.7 billion – an increase of around €2.4 billion compared with the previous year.
However, there were significant differences in performance between providers: whilst some pension funds once again outperformed the inflation rate, others remained just below it. What may seem insignificant in the short term can develop into a real game-changer over the years: even moderate differences in performance have a long-term impact on the final return – and thus directly on how much capital employees actually have at their disposal when they retire.
Market consolidation continues
A key structural change in 2025 was the successful integration of fair-finance into BONUS Vorsorgekasse AG. This reduced the number of providers on the Austrian market to seven. In terms of assets under management, VBV ranked first at the end of 2025 with a market share of 34.17%, followed by Valida with 24.16% and BONUS with 13.33%. The market therefore remains highly concentrated.
In parallel with this stable market development, the political debate on the future of the ‘new severance pay’ scheme also gained momentum again in 2025. The focus was primarily on the question of how occupational pension schemes could be better integrated into the overall pension system in future. One idea discussed was a general pension fund agreement, which would make it easier to transfer accumulated severance pay balances into a pension fund or occupational collective insurance scheme tax-free in future. The 100% gross capital guarantee was also raised again, as it can limit opportunities for higher returns in the long term. Although there were no specific legislative changes in 2025, the reform debate is clearly back on the agenda, and current developments suggest that a second investment pool – without a capital guarantee but with higher potential returns as a result – will indeed be established.
A look to the future – occupational pensions remain a key lever
One thing is clear: to safeguard living standards in retirement, supplementary pension provision is becoming increasingly important in Austria. Relying solely on state pension schemes is increasingly reaching its limits. This makes supplementary solutions via the second pillar – occupational pensions – all the more important. For companies, this means that choosing the right occupational pension scheme remains a key factor in retaining existing staff and in employer branding. If a switch to a different occupational pension scheme is planned, this must be completed by 30 June 2026 so that the new provider can take effect from 1 January 2027.
Joachim Schuller
Competence Center Manager
Health & Benefits
T +43 664 962 39 11
