Necessity and Prerequisites for Implementing Compulsory Accumulative Pension Insurance in Ukraine

The article explores the necessity and prerequisites for the introduction of accumulative pension insurance in Ukraine in the context of current demographic, economic and social challenges. The authors analyse the current state of the Ukrainian pension system, which is based on the pay-as-you-go principle and substantiate its limitations in ensuring sustainable functioning in the context of an ageing population and a declining share of the working-age population. The study shows that the current PAYG system is no longer able to provide a decent level of pensions for most citizens due to low revenues to the Pension Fund and an uneven burden on the working population. In the context of demographic imbalance, the authors emphasise the importance of moving to a multi-pillar model of pension provision, with a key role played by the mandatory accumulative pillar. Based on the analysis of international experience, in particular, Eastern European and Western European countries, the article identifies successful practices of implementing funded systems. The authors find that countries with similar socio-economic conditions as Ukraine have achieved positive results by introducing mandatory accumulation contributions, ensuring transparency of pension funds and creating effective mechanisms of state regulation. The article reveals the main prerequisites for the successful implementation of the accumulative system in Ukraine, among which the authors highlight: the need to build public confidence in financial institutions, increase the level of financial literacy, develop effective legal regulation, and create transparent and reliable mechanisms for managing pension assets. In addition, attention is paid to potential risks, such as macroeconomic instability and lack of public awareness, which may complicate the implementation of the reform. The article presents the results of an empirical study, which includes a sociological survey of Ukrainian citizens on their attitude to accumulative pension insurance, as well as an analysis of statistical data of the Pension Fund of Ukraine in recent years. The data obtained demonstrate a low level of awareness and trust in pension reforms among the population, which requires intensification of information and awareness-raising activities. The authors formulate recommendations for the introduction of a funded system, including the creation of flexible conditions for citizen participation, the introduction of incentives for voluntary contributions, and the development of tools to protect pension savings from inflationary risks. These recommendations can be used to develop strategic documents for reforming the pension system of Ukraine.