The Finnish pension system
The Finnish pension system consists of earnings-related pensions, which are accrued by working in Finland, and the national pension, which is based on residence in Finland.
Earnings-related pensions and the national pension are paid as old-age pensions, disability pensions, cash rehabilitation benefit and survivors’ pensions. As of 2017 it has also been possible to get earnings-related pensions as partial old-age pensions and years-of-service pensions.
If you are interested in your own old-age pension, go to the page Old-age pension in Finland.
Earnings-related pension in Finland
Employers must insure their employees, and self-employed persons must insure themselves, with a pension provider. Pension providers include pension insurance providers, pension funds, pension foundations and in some sectors there are special pension providers. Read more on the website Työeläke.fi.
Both employers and employees pay pension contributions. Employers deduct employees’ pension contributions from their wages and pay them to the pension provider. If you are self-employed, you pay your pension contributions yourself. Different groups are insured based on different pension acts.
Pensioners get all their earnings-related pension from the same pension provider even if they have worked in various sectors and have been insured with various different pension providers during their working career. Read more about which pension act applies to you below.
Accruing entitlement to earnings-related pension in Finland
Employees begin to accrue pension at the age of 17 and self-employed persons at the age of 18.
A pension reform came into force at the start of 2017 which means that employees and self-employed persons begin to accrue earnings-related pension at a rate of 1.5% of their annual employment earnings or self-employed persons’ employment income. However, there is a transition period of 2017-2025, when the annual accrual for persons aged 53-62 is 1.7 per cent of employment earnings or self-employed persons’ employment income.
When a pension is granted, the accrued pension is adjusted by a life expectancy coefficient, which adjusts pensions to the increase in life expectancy. Read more on the website Työeläke.fi.
National pension in Finland
The national pension is a residence-based social security benefit, i.e. receiving it and the amount depend on the insurance period, i.e. the length of residence in Finland and the pensioner’s other pension income. National pensions are administered by the Social Insurance Institution of Finland (Kela). Read more on Kela’s website.
Types of pension
Old-age pension paid in Finland consists primarily of earnings-related pension, which all persons in paid employment accrue during their working career. If your earnings-related pension is small or you are not getting any at all, your old-age pension is national pension and possibly guarantee pension, which are residence-based pensions.
Partial old-age pension leaves you free to work while drawing a pension: there is no limit on what work you do, but there is also no requirement to work.
Read more about old-age pension on the page Old-age pension in Finland.
Disability pensions are granted on the basis of permanent incapacity for work. Before actual disability pension, you can get cash rehabilitation benefit, i.e. time-limited disability pension. Rehabilitation is always the preferred option. Read more on the pages Rehabilitation in Finland and Disability pension in Finland.
You can be granted a years-of-service pension if
- you have reached the age of 63,
- you have done strenuous work for at least 38 years and
- your working capacity is somewhat reduced.
Read more on the website Työeläke.fi.
Survivor’s pensions are paid to surviving spouses and children under the age of 20. Kela also pays orphan’s pensions to children under the age of 21 who are studying full-time. If you have lived in another country, you can get a survivors’ pension from Kela if you are covered by the Finnish social security system and the other conditions are met. You can read more about survivor’s pensions on the page Benefits in Finland in the event of bereavement.
What if you move abroad?
Accumulated pension savings cannot be transferred from one country to another before retirement. If you have worked in Finland and accrued a pension under Finnish pension rules, the accrued pension will be paid to you from Finland to the other country when you retire. If your working period was short, it is taken into account through the principle of aggregation of periods. Read more on the Your Europe website.
If you receive a pension from Finland and move to another Nordic country, your earnings-related pension and national pension will be paid at the same rate as before you moved. Housing allowance for pensioners is not paid to other countries. Under EU regulations, a child increase is paid to persons who get national pension or earnings-related pension from Finland.
Guarantee pensions can only be paid to persons living in Finland. Guarantee pension recipients can, however, reside abroad temporarily without losing their right to their guarantee pension.
You can read more about pensions to other countries on Kela’s website.
Where can you find information on other forms of pension saving?
In addition to statutory pension cover, you may also receive a voluntary supplementary pension agreed in the labour market or an individual pension. There are also other ways to save for retirement. Read about supplementary pension cover on the Finnish Centre for Pensions website.
More information
Please fill in our contact form if you have any questions or if you have encountered an obstacle in another Nordic country.
NB! If you have questions regarding the processing of a specific case or application, or other personal matters, please contact the relevant authority directly.
