The Potential of Recovering Debts for the Single Social Security Entity (EFKA)
The Single Social Security Entity (EFKA) has the potential to recover an additional 4 billion euros from large debtors and debts that have rapidly increased due to high additional fees and surcharges, if the right mechanisms are put in place.
The Efforts of the Social Security Debt Collection Center (KEAO)
Despite being understaffed, the Social Security Debt Collection Center (KEAO) manages to collect around €1-1.5 billion annually through various arrangements and compulsory collection measures.
The Challenge of Increasing Debts
While the main debts have been decreasing, the total dues have been on the rise, now reaching €47.88 billion, causing concern for the government. To address this issue, various solutions are being considered, such as creating a single blacklist for debts owed to the state and pension funds. Currently, EFKA and KEAO lack information on debtors’ financial behavior over time and their payment history with public sector entities, hindering their ability to assess creditworthiness.
Efforts to Address Debt Issues
Efforts are being made to address the debt issues faced by individuals and companies in the country. One of the main challenges is the lack of cooperation between credit rating agencies, which hinders the sharing of information and scores.
Cooperation with Private Individuals
EFKA and KEAO are considering cooperating with private individuals to target specific groups of debtors who are able to pay their debts. Currently, there is no flexibility in the payment options, which makes it difficult for debtors to settle their debts.
Out of the total debt owed to KEAO, only a portion corresponds to the actual debt, while the rest is made up of additional fees. If the original debt is not paid in a timely manner, the additional fees can accumulate and even surpass the principal debt due to the lack of a cap on these fees.
KEAO and EFKA data reveal that there are thousands of debtors whose additional fees exceed their main debt, highlighting the urgent need for a solution to this issue.
Investing in Bonds
Investing in bonds can be a great way to diversify your portfolio and earn passive income. Bonds are essentially loans that you give to governments or corporations, and in return, you receive regular interest payments. This can be a steady source of income, especially if you choose bonds with a high interest rate.
Benefits of Bonds
One of the main benefits of investing in bonds is the fixed income they provide. Unlike stocks, which can be volatile, bonds offer a predictable stream of income that can help you meet your financial goals. Additionally, bonds can act as a hedge against stock market fluctuations, providing stability to your investment portfolio.
Considerations Before Investing
Before investing in bonds, it’s important to consider the creditworthiness of the issuer. Government bonds are generally considered safer than corporate bonds, as governments are less likely to default on their debt. It’s also important to consider the interest rate of the bond, as higher interest rates can lead to higher returns on your investment.
Conclusion
Overall, investing in bonds can be a smart way to diversify your investment portfolio and earn passive income. By carefully selecting bonds with a high interest rate and strong credit rating, you can build a stable source of income for the future.
