The Ministry of Social Affairs and Health has confirmed the life expectancy coefficient for 2017 to be 0.96344.
For those born in 1955, the coefficient will reduce the old-age pensions under the earnings-related pension acts starting in 2017 or later by approximately 4 per cent. The life expectancy coefficient will also reduce the disability pensions granted in 2017, apart from the projected pension component, which is not affected by the life expectancy coefficient.
The life expectancy coefficient adjusts the level of starting earnings-related pensions and the pension expenditure in line with the changing expected average life expectancy. If the average life expectancy continues to increase, the life expectancy coefficient will reduce the monthly pensions.
The coefficient was applied for the first time in 2010. The aim is to get people to work longer in order to compensate the effects of the life expectancy coefficient. The target retirement age (the age at which the effect of the life expectancy coefficient has been removed) for those born in 1955 is 64 years and 1 month.