What are the consequences for my pension benefits of a pledge covering residential property?

While an early withdrawal will decrease your pension savings and thus your benefits, with a pledge no capital flows out of your retirement pension. You won't forgo any interest income, and your benefits won't change. Pledging merely serves as additional security for your bank.

Provided that the loan can be serviced, a pledge has no impact on your retirement provision and both interest income and benefits will remain unchanged. Only if the loan can no longer be serviced will the pledge be utilized. In other words: The outstanding loan amount will be settled with your retirement provision assets – and the pledge will be used for the promotion of home-ownership. In this case, your pension benefits will be reduced.