There is no investment fund, it is a Ponzi scheme where the current payers cover the current retirees. It works when demography plays in your favour but like any Ponzi once you run out of new entrants the Ponzi collapses it's just a matter of when and how much money printing will be flooded to clean up the mess (same applies to France, Italy...)

galt

Of course. But most of the pensions paid come from a so-called pay-as-you-go system in which employees and employers pay the current pensioners and pension contributions.

TomK

So what's in the German 401k type retirement funds? Bonds? 

Signal312

econ

Fiat clown show: financial illiteracy impoverishes Europeans

In Germany stocks aren't part of 401k-type retirement funds. There is a political debate on allocating funds into a type of a stare fund (of course) but no, there is no equity culture in Europe except of in rich families that are hiding this knowledge as good as they can.