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Finnish pension system in a nutshell

Article 28.4.2022

Finland has one of the best pension systems in the world - and that’s a fact. But if you’re starting a business in Finland, you might be wondering why it’s mandatory for entrepreneurs to take out pension insurance. Or for employers to get pension insurance for their employees? We are here to help you!

Finnish pension system in a nutshell
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  1. EPSI Rating: Ilmarinen has the most satisfied customers in the sector
    According to the latest EPSI Rating survey, Ilmarinen has the most satisfied customers in the earnings-related pension sector. We ranked first among both employers and self-employed persons.
    Read news article EPSI Rating: Ilmarinen has the most satisfied customers in the sector
  2. Employer, self-employed person or pensioner: 2027 earnings-related pension index and wage coefficient confirmed
    The Ministry of Social Affairs and Health has confirmed the pension indices for 2027. The earnings-related pension index will be 3,184, which means pensions will increase by approximately 2.6% at the turn of the year. The wage coefficient has been confirmed at 1.773, an increase of approximately 3.6% from 2026.
    Read news article Employer, self-employed person or pensioner: 2027 earnings-related pension index and wage coefficient confirmed
  3. Ilmarinen’s return on investments was 6.2 per cent or EUR 4.2 billion
    Employment pension insurance company Ilmarinen’s investments yielded 6.2 per cent in January–September. The market value of investments grew to a record-breaking level of EUR 71 billion.
    Read news article Ilmarinen’s return on investments was 6.2 per cent or EUR 4.2 billion
  4. YEL reform moves forward: more choice for self-employed persons on how contributions are determined
    The proposal to amend the Self-employed Persons’ Pension Act (YEL) will now proceed to Parliament. After the reform, pension contributions and pension benefits would be based either on YEL income determined much as it is today or on actual earnings.
    Read news article YEL reform moves forward: more choice for self-employed persons on how contributions are determined
  5. Ilmarinen had a strong first half of the year. In January–June, the return on investments was 5.3 per cent, or EUR 3.5 billion. Solvency ratio improved, and customer acquisition was at a good level.
    Read news article
  6. Agreement reached on YEL reform  – a proposed freedom of choice model for pension contributions
    The Ministry of Social Affairs and Health has released a draft government proposal to reform the Self-Employed Persons’ Pensions Act (YEL). Under the proposed reform, your pension contributions and benefits would be based on either your taxable earned income from your most recent completed tax assessment, or a confirmed income (as today) based on an overall assessment of your work input.
    Read news article Agreement reached on YEL reform  – a proposed freedom of choice model for pension contributions
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