The management of pension funds in Turkey

The problem of social security has recently become the primary problem of both developed and developing countries. Although there are concerns about the current structure and the operation of the system in Turkey, too, a new page has been opened in this process along with the Personal Pension Savings and Investment System Law numbered 4632. Expected to support the level of welfare of individuals in the end of their active working lives and help individuals provide a side income, this system also aims to play an active part in the development of capital markets through long term funds, with which it creates personal retirement funds, and contribute to the stability of markets by taking initiative in macro-economic developments.A necessity for a new structure has also emerged in Turkey because of the ill operation of the public social security system, and the Personal Pension System has been launched. For the system to work effectively, all parties are required to work actively. Along with the increase in the number of institutional investors, finance instruments will diversify in the money and capital markets and long term funds will bring a new dimension to markets.Considered from a general perspective, two fundamental management principles appear in the management of pension mutual funds. In spite of the instability of capital markets and the variability of the system?s applicability in the country, these two approaches have a common goal which is to provide the security of the contributions of individuals and ensure that these individual contributions will be in a level as required by individuals in the period of retirement.Keywords: Social security, Personal pension system, Pension mutual funds, Pension funds