3 The chart illustrates how long-term yields have declined over the last two decades, driving down the returns that pension funds can expect to earn on their investments. The decline in expected returns coincided with a substantial increase in longevity. Decreasing returns in conjunction with rising longevity may appear as a dangerous cocktail for a pension fund.
But by shifting savers from schemes with a guaranteed minimum return to market-based schemes, Danish pension funds have reduced the impact of changes to returns and longevity on their financial position. Chart 4: Long-term yields have declined  3  See OECD, 2021, Pension Funds in Figures.