Studies show that the income of pensioners (except those on a disability pension) has improved over the last 20 years when measured with most key income indicators. Pensioners’ position compared to wage-earners’ has improved slightly. Poverty is most common among those getting a disability pension, living in single households and older women.

In 2021, the average total pension of a pension recipient was 21,408 euros per year, or around 1,784 euros per month. Compared to 2000, the income of retirees rose by 40 per cent in real terms.

Relative to wage-earners and the self-employed, retirees’ equivalent income was 69 per cent and, relative to the entire population, 84 per cent. Those in employment are best off in Finland. The most vulnerable are the inactive, such as students and the long-term unemployed.

Different ways to measure pensioners’ income

Pensioners’ income can be measured by reviewing, for example, average pensions. Average pensions have increased since the earnings-related pension system came into force, as wages have increased and working lives have extended.

Pension levels can also be reviewed by comparing the pension level to the income earned before retirement. This is what is meant by the replacement rate.

When the viewpoint is expanded from pension level to pension recipient’s income, the household size and the structure and form of housing play a great role. A household of two pensioners manages with a lower income than does two pension recipients living alone. Living in owner-occupied housing also tends to be cheaper than living in corresponding rental housing.