Summary
Highlights
Starting July 1st, 2026, a new 'silenzio assenso' (implied consent) rule will take effect. Newly hired private sector employees will have their TFR automatically transferred to a category pension fund (or Cometa if none exists). Employees have 60 days to opt out and keep their TFR in the company; otherwise, the choice becomes irrevocable. This reform aims to encourage long-term savings in a context of demographic decline, public debt, and inflation.
TFR is an annual accrual of approximately 6.91% of your gross annual salary, paid at the end of employment. It receives an annual revaluation of 1.5% plus 75% of inflation. Historically, TFR in a company has yielded around 2.4-2.5% annually, which typically offers limited protection against inflation, especially when inflation is high. Paradoxically, TFR in a company performs better when inflation is high, as investment portfolios often suffer.
Transferring TFR to a pension fund offers three main advantages: lower taxation on withdrawals (starting at 15% and potentially reducing to 9% after 35 years, compared to 25-30% for TFR in a company), employer contributions (usually 1-2% of salary if the employee contributes a minimum), and tax deductibility of voluntary contributions (up to €5,300 annually), which can result in significant tax savings. These 'free money' contributions are a major benefit.
Pension funds invest money in markets, with returns varying by compartment (equity, balanced, guaranteed). Equity compartments have yielded 4-5% annually over the last decade, double that of TFR in a company. Balanced compartments returned 2-3%, while guaranteed ones were near zero. Costs are a significant factor, with 'fondi negoziali' (category funds) being the cheapest (0.2-0.5% over 35 years) compared to 'fondi aperti' (open funds) and PIPs (individual pension plans) which are more expensive. However, open funds may offer more aggressive equity allocations suitable for long-term investors.
A simulation for Alice, earning €30,000 annually with 35 years of work ahead, illustrates the financial outcomes. If she keeps TFR in the company and reinvests the liquidations in an equity ETF, she might accumulate around €211,000. If she transfers TFR to a pension fund, contributing additionally and receiving employer contributions, the final capital could be around €176,000. The comparison shows that with employer contributions and tax benefits, pension funds become highly competitive, especially for the average worker who might not consistently reinvest TFR liquidations.
There are specific scenarios where keeping TFR in the company might be the better choice:
If you would only choose a guaranteed or bond compartment in a pension fund, you'd forgo the steady protection of company TFR while also getting lower returns and more restrictions.
If you are only a few years from retirement, the compound interest effect won't significantly benefit you, and a prudent compartment might not outperform TFR in the company.
If you need immediate access to your money upon job changes or want to receive 100% of your capital at retirement, company TFR offers more flexibility. Pension funds generally allow only up to 60% of capital immediately, with the rest as an annuity.