DO YOU KNOW HOW
THE EARNINGS-RELATED PENSIONS
WILL BE REFORMED IN 2017?
Gradually rising retirement age  Continued working rewarded 
Standardised pension accrual rates  Introducing: Years-of-service
pension and Partial early
old-age pension
1
WILL I BE AFFECTED BY THE REFORM?
The pension reform applies to you if you were born in 1955 or later
and have not yet retired. The reform will be implemented gradually
as of 2017.
NO CHANGES TO THE BASICS
Earnings-related pensions will continue to accrue from work. Each
euro you earn will therefore contribute to your future pension.
You and your employer will both contribute to your pension.
Your employer will automatically withhold your share of the
earnings-related pension contribution from your wages and pay
it, together with its own share, to your pension provider. If you are
self-employed, you have to pay the contribution yourself. When
you retire, your pension provider will pay out your pension. If your
working life has been short or your earnings low, you may also
receive a national pension or a guarantee pension paid by the
Social Insurance Institution of Finland (Kela).
2
GRADUALLY RISING RETIREMENT AGE
As of 2017, the general retirement age will rise from the current 63
years by three months per year, until it is 65 years. The new age
limits apply to those born in 1955 or later. For example, if you were
born in 1955, your earliest retirement age will be 63 years and 3
months. If you were born between 1962 and 1964, you can retire at
age 65 at the earliest.
RETIREMENT
AGE
2018
65 yrs
64 yrs 9 mos
64 yrs 6 mos
64 yrs 3 mos
64 yrs
63 yrs 9 mos
63 yrs 6 mos
63 yrs 3 mos
1955 1956 1957 1958 1959 1960 1961 1962 1963 1964
BIRTH YEAR
As of 2030, the retirement age will be linked to life expectancy.
After that, the retirement age may rise by no more than two months
per year. For example, if you were born in 1965, you can retire at
age 65 years and 2 months.
3
TARGET RETIREMENT AGE
For each age group, an earliest possible retirement age will be
determined, as well as a somewhat higher target retirement age.
For example, if you were born in 1955, your target retirement age
will be 64 years and 1 month. If you retire at your target retirement
age, you will receive your pension “in full”, that is, to the amount
that you would have received without the reducing effect of the life
expectancy coefficient.
The life expectancy coefficient was introduced in 2010 since people
live longer. As a result of the life expectancy coefficient, your monthly
pension will be somewhat smaller, but the coefficient makes sure
that your pension capital will last throughout your retirement.
Even if you don’t continue working until your target retirement age,
your pension will grow for each month that you work past your
general retirement age.
4
WORK LONGER AND RECEIVE A HIGHER
PENSION
If you continue working past your general retirement age, your
pension will grow. For each month that you defer your retirement,
your pension will grow by 0.4 per cent. In one year, it will grow by
4.8 per cent. On top of this increment for deferred retirement, you
will earn pension at a rate of 1.5 per cent of your monthly earnings
from work.
STANDARDISED PENSION ACCRUAL
You will accrue earnings-related pension as of age 17 at a rate of 1.5
per cent of your annual earnings. If you are self-employed, you will
accrue pension as of age 18. During the transition period from 2017
to 2025, you will accrue pension at a rate of 1.7 per cent if you are
between the ages of 53 and 62.
5
YEARS-OF-SERVICE PENSION AFTER LONG
AND STRENUOUS WORKING LIFE
If you have had a strenuous and long working life, you may be able
to retire already at age 63. If your working capacity has diminished
and your work has been strenuous and wearing for 38 years, you
can apply for a years-of-service pension.
6
DRAW YOUR PENSION IN BITS
The part-time pension will be replaced by a partial old-age pension.
You can draw parts of your old-age pension before reaching
your general retirement age, regardless of whether you continue,
reduce or stop working. In 2017, you can draw parts of your old-age
pension as of age 61.
You can draw a quarter (25%) or half (50%) of your accrued
pension. If you draw a part of your pension before your general
retirement age, that part will be reduced by 0.4 per cent for each
month left until your general retirement age.
For example, if your accrued pension is 1,500 euros and you select
to draw 50 per cent of it (EUR 750) one year before your general
retirement age, your monthly pension will be permanently reduced
by 4.8 per cent, or 36 euros, per month.
Retirement
age
yrs
7
WHY THE NEED FOR A REFORM?
The pension reform is necessary to ensure that pensions can be
paid and be sufficient also in the future, despite the fact that
people live longer.
More questions? Go to Eläkeuudistus.fi/Briefly in English or
contact your pension provider for more information.