Germany Plans Structural Pension Shift With Swedish-Style Capital Fund

Germany's pension commission has proposed raising the statutory retirement age beyond 67 and establishing a state-run capital reserve fund modeled on Sweden's buffer system, with Chancellor Merz's backing. The move would make Germany the largest eurozone economy to shift away from pure pay-as-you-go financing. The fund would invest across asset classes, with returns offsetting future contribution shortfalls—addressing demographic pressure from an aging population and shrinking workforce.