List of topical issues
Photo: Katri Lehtola

The majority of respondents feel that their quality of life has improved after retirement on an old-age pension, with more leisure time increases and better coping skills. However, income is perceived as weaker, according to a survey conducted by the Finnish Centre for Pensions among people who had recently retired from gainful employment with an old-age pension.

The study shows that people who have recently retired perceive their quality of life to be at least fairly good on average before retirement, but that it improves further after retirement. In particular, satisfaction with the amount of leisure time available increased significantly, and more people than before felt that they could cope well.

“Retirement can improve the quality of life, especially for those who found their work too stressful, had problems with coping or had hoped for more leisure time”, says Senior Researcher Liisa-Maria Palomäki of the Finnish Centre for Pensions.

Assessments of quality of life and its aspects before and after retirement, on a scale of 1-5, average value. Quality of life was perceived to have improved slightly, with a mean score of 4.37  for perceived quality of life after retirement. Satisfaction with leisure time increased significantly after retirement, with an average score of 3.46 before and 4.65 after retirement. The scores for social relations and health remained almost unchanged, at just over 4. Coping was perceived to have improved somewhat, with an average score of 4.32 after retirement.

According to Palomäki, the study shows that retirement in a multifaceted change in life. “Retirement is perceived as bringing both positive and negative changes, but when these are added up, the overall quality of life improves on average.

Income changes mostly expected – yet a quarter find it harder than expected to make ends meet

Before retirement, 90 per cent of the respondents felt that they were able to meet their expenses fairly easily.

After retirement, making ends meet became more difficult. However, two in three people say that it is still at least fairly easy to make ends meet. Nearly one in ten, on the other hand, state that it is difficult or very difficult to cover everyday expenses.   “Although making ends meet tended to be more difficult after retirement than before, changes in income were largely in line with the respondents’ expectations. However, one in four respondents found it more difficult than expected to make ends meet”, explains Sanna Tenhunen, economist at the Finnish Centre for Pensions.

Perceived income in retirement compared to expectations, per cent. Almost 64 per cent of the respondents felt that their income in retirement would be in line with their expectations. About 5 per cent thought it would be easier than expected and almost 5 per cent thought it would be somewhat easier than expected. Making ends meet was slightly harder than expected for around 19 per cent and harder than expected for almost 8 per cent of the respondents.

Little change in social relations after retirement

On average, respondents were only slightly less satisfied with their social relations after retirement than before. A slight increase in dissatisfaction is most likely related to the importance of social relations at work. In a previous research report, three in four retired persons said that the social relations at work before retirement had been important to them.

Longer working lives would require more flexibility in the workplace

According to the study, quality of life is perceived more positively after retirement. This suggests that there may be factors in working life that make people reluctant to work beyond their retirement age.

When making the decision to retire with an old-age pension, many people are likely to consider changes that will affect their quality of life, such as more leisure time and improved coping skills.

“To prolong working life, we need to develop various flexible elements in working life and determine how to help workers approaching their retirement age to continue working longer”, says Palomäki. Almost 3,400 people who will retire from paid work with an old-age pension between 2019 and 2021 took part in the survey.

Research publication

Change in quality of life at retirement on an old-age pension – Survey of persons retiring from work on an old-age pension in 2019–2021

Previous reports based on the survey

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