Pension Ceilings
Pension ceiling usually refers to an upper limit (in euros) of paid out pensions. For the most part, the aimed pension ceiling has been implemented by setting an upper limit for the pensionable wage, that is, for the amount of earnings for which pension accrues.
Within the Finnish earnings-related pension scheme, there is no upper limit for the pensionable wage or the pension itself. In many other countries, the pension accrued within the statutory earnings-related pension scheme has been limited with a pensionable wage and/or pension ceiling.
In most countries, the pensionable wage ceiling that limits the pension accrued within the statutory earnings-related pension scheme is approximately 1-2 times the country’s average wage.
It is possible to break the pension ceiling with various supplementary pension arrangements that complement statutory pensions. In some countries, supplementary pension arrangements are obligatory. Generally speaking, the lower the pensionable wage ceiling is in a country, the higher is the role of supplementary pension schemes that break the ceiling. However, their scope varies from one country to another.
The following graph compares upper limits of the pensionable wage and average wages in various countries. In most countries, the pension wage ceiling that limits the amount of earnings-related pension a person can earn is 1-2 times the average wage in the country. The table after the graph presents the pension ceilings (in euros) in certain countries, rounded to the nearest 10 euros.
In addition to Finland, there is no ceiling in countries such as Iceland, Estonia, Hungary, Portugal and Romania.
Pensionable wages and pension ceilings of the statutory pension scheme in some countries (2022)
| Country | Pensionable ceiling €/month | Pension ceiling €/month |
|---|---|---|
| Belgium | 5 960 | 3 000 |
| Spain | 4 140 | 3 060 |
| Italy | 8 750 | – |
| Austria | 6 620 | – |
| Greece | 6 500 | – |
| Luxembourg | 11 570 | 9 190 |
| France (regime general) | 3 430 | 1 710 |
| France AGIRC-ARRCO (supplementary pension) | 27 420 | – |
| Sweden | 4 180 | – |
| Germany: old states | 7 050 | – |
| Germany: new states | 6 750 | – |
| Norway | 6 530 | – |
| Switzerland | 7 140 (BVG) | 2 380 (AHV) |
| USA | 11 630 | 3 400 |
| Canada | 3 950 | 870 |
AHV = Mandatory pension system in Switzerland
BVG = Supplementary pension scheme in Switzerland