Financing and Investments

In Finland, statutory earnings-related pensions are financed mainly by the pension contributions paid each year. However, part of the pensions are financed with funded assets and returns on funds. Employers, workers and self-employed persons pay statutory earnings-related pension contributions. Part of the earnings-related pension contributions are funded into funds governed by earnings-related pension providers. They are under obligation to invest the assets profitably and prudently and to finance an agreed share of the pension from their own fund.

The earnings-related pension is granted and paid by the earnings-related pension provider in which the worker was last insured before retiring. In the cost division carried out by the Finnish Centre for Pensions, the shares of the expenses for paid pensions that are the liabilities of the various actors are sorted out.

Money flows

The earnings-related pension system’s assets decreased in 2022 with 16.4 billion euros. Total assets at year-end were 242.4 billion euros.

The decline in pension assets for 2022 was mainly due to investment losses. They amounted to 14.8 billion euros.

Statistics on money flows

Financing principles

Statutory earnings-related pensions are financed mainly through the pay-as-you-go (PAYG) system, that is, the earnings-related pension contributions paid in the year in question. Part of the pensions are financed under the partial funding principle by using both earnings-related pension contributions and previously accumulated funds.

Financing principles of earnings-related pensions

Long-term projections (LTP)

The long-term projections project the future of the pension system, 60–70 years. The projections, which focus on statutory pensions, are published every two to three years.

Long-term projections

Earnings-related pension contributions

In Finland, earnings-related pensions are financed mainly by earnings-related pension contributions paid by employers, workers and the self-employed. Check the valid contribution rates.

Earnings-related pension contributions

Statistics on earnings-related financing

The Finnish Centre for Pensions produces time series from the financial statements of the pension providers. The pension providers deliver also figures to the cost division. The financing of pension tables are published yearly in The Finnish Centre for Pensions statistical database.

Read more on the financing statistics website

Finnish Centre for Pensions – Central body of and expert on statutory earnings-related pensions