Pension funds: over the past decade, the equity sector has delivered average annual returns of 5%, compared with 2.5% for severance pay

 Compared with the workforce, participation in supplementary pension schemes continues to grow, particularly among younger age groups (up 9.8 percentage points over five years in the 15–34 age group).

As regards geographical distribution, the participation rate exceeds the national average in the northern regions, where 57.3 per cent of members are concentrated; lower figures, well below the average, are recorded in most of the southern regions.

By the end of 2025, the assets accumulated by supplementary pension schemes stood at €262 billion (up 7.7% on 2024), mainly due to the positive performance of the financial markets. Accumulated assets amount to 11.6% of GDP and 4% of Italian households’ financial assets. Contributions collected during the year total €22.4 billion (+8.7% compared to 2024), growing at a rate higher than the average for the previous five-year period. €7.9 billion was raised in occupational pension funds (+10.9%); €3.9 billion in open-ended funds (+15.4%); and €5.6 billion in ‘new’ PIPs (+5.7%); pre-existing funds received €4.8 billion (+4.4%). €18.7 billion in contributions were paid into employees’ accounts, an increase of €1.6 billion compared to 2024. Of this, €9.6 billion relates to severance pay contributions; €5.7 billion are contributions paid by employees and €3.4 billion are employer contributions. For the self-employed, contributions totalling €1.9 billion were paid in. There were 7.4 million contributing members in 2025, accounting for 73% of the total. The average contribution for these members is €2,990; it is higher for employees (€3,110), who can also benefit from severance pay inflows, compared to the self-employed (€2,780). The gender gap is also evident when looking at the amount of contributions paid: for women, the average contribution is 16% lower than that of men. In the northern regions and some central regions, contributions are higher than the average, whilst they are halved in many areas of the south. There are approximately 2.7 million non-contributing members, reversing the upward trend for the first time. In 2025, pension benefits were paid out as lump sums totalling €5.5 billion and as annuities totalling €347 million. Redemptions amounted to €2.1 billion and advances to €2.8 billion. During the year, approximately €2.8 billion in temporary supplementary pension advances (RITA) were paid out, mostly from pre-existing pension funds.

Pension fund investments continue to be predominantly allocated to government bonds and other debt securities, accounting for 55.8% of the total. Overall equity exposure has risen to 32.9%, an increase of 2.4 percentage points compared with 2024. Real estate investments, both direct and indirect, account for less than 2% of the total.

Pension fund investments in the Italian economy (government bonds, securities issued by entities resident in Italy and property) amount to €43.9 billion, representing 19.3% of the total (the same percentage as in 2024). Investments in debt and equity securities of domestic companies, amounting to €3.4 billion and €2.4 billion respectively (€3 billion and €2 billion in 2024), and domestic investments held through UCITS units stand at €2.3 billion.

Despite the marked international diversification that characterises the investment policies of pension schemes, the sector is showing a growing interest in the investment opportunities offered by the domestic market.

An increasing number of pension funds, particularly sector-specific ones, are expanding their portfolios by including unlisted financial instruments and so-called alternative funds – such as private equity, private debt and infrastructure funds – often by participating in joint investment initiatives. These are instruments that can contribute to investment diversification and represent a tangible channel for supporting the productive activities of Italian businesses.

In 2025, returns—net of management fees and tax—were positive across all categories of supplementary pension schemes.

Equity funds delivered the strongest performance, with average returns ranging from 7.5% to 10%, whilst balanced funds returned between 3.5% and 5.5%. Bond funds also performed well, albeit to a lesser extent. Over a ten-year observation period (from the end of 2015 to the end of 2025), the average annual compound returns of the funds with the highest equity content stand at around 5% for all types of pension schemes, exceeding the average return of other investment funds and also the rate of revaluation of severance pay (averaging 2.5% per annum over the decade). Equity-based investment options, however, continue to be chosen by a minority of members, accounting for 13.9% of the total.

Management fees affect net returns, eroding their potential growth. Over a 35-year investment period, a 1% reduction in annual fees results in a final return that is 18–20% higher.

Costs remain competitive for occupational pension funds: over a ten-year period, the Synthetic Cost Indicator (SCI) stands at 0.47%, The SCK rises to 1.36% for open-ended pension funds and to 2.17% for PIPs, products for which sales network remuneration plays a significant role.

At the end of 2025, the total assets held by pension funds amounted to €136 billion at market value, an increase of 8.7% compared with the previous year; this increase was driven primarily by the positive performance of the financial markets, particularly the equity markets. The largest share of assets consists of debt securities, accounting for 36% of the total. Investments in equity securities account for 21.6%. Investments in property remain substantial, albeit declining in percentage terms, accounting for 14.8% of the total. Investments in the Italian economy (government bonds, securities issued by entities resident in Italy and property) amount to €52.3 billion, accounting for 38.4% of total assets. Government bonds are the dominant component: €17.1 billion, accounting for 12.6% of total assets. This is followed by the property component with €17 billion, accounting for 12.5% of total assets, down by 1.2 percentage points compared with 2024. Investments in securities issued by Italian companies amount to €12 billion, 8.8% of total assets, 1.2% more than in 2024; of which €882 million are debt securities and €11.2 billion are equity (including €1.9 billion in shares in the capital of the Bank of Italia, subscribed by 12 Casse).