Pension reform 2017

The Finnish earnings-related pensions system has been reformed. The reform took effect on 1.1.2017.


The Finnish population is living longer and, consequently, the time spent in retirement is increasing. In order to secure the funding for the national pension scheme, it is necessary to increase the years we spend in working life. The pension reform aims to lengthen work careers and, among other things, to raise the minimum pensionable age.

A central aspect of the pension reform is to ensure the sufficiency of pensions and guarantee fairness between generations.


The reform entered into force on 1 January 2017. The new law will not be applicable retroactively.

For whom?

The pension reform applies to all those who retire on and after 1 January 2017. If you have already retired before the end of 2016, this reform will not apply to you.

The reform will also have no effect on any pension accrued prior to the reform’s entry into force.

What has changed? 

  • Employees will begin to accrue their pension at 17 years of age. Any employees aged 17 or older must be insured under the employer’s TyEL policy.
  • Pension will accrue at an annual rate of 1.5 per cent for the entire duration of your work career. The change includes, however, a transition period, during which those aged 53-62 will accrue pension at an annual rate of 1.7 per cent. The transition period will last until the year 2025.
  • The pension is accrued from the total salary. The employee’s share of the pension insurance contribution will no longer be deducted from the salary that serves as the basis for pension when the pension is calculated.
  • The minimum age for old-age pension will increase in stages until it reaches 65. The minimum age will rise by 3 months per age class starting with those born in 1955, whose pensionable age will thus be 63 years and 3 months. Those born in 1962 will be the first age class whose pensionable age is 65.
  • If you defer your retirement beyond the pensionable age, the amount of your pension will increase by 0.4 per cent for each month the retirement is deferred.
  • The upper age limit for the TyEL and YEL insurance obligation will change for both employees and self-employed persons. The upper age limit is determined on the basis of a person’s year of birth.
  • Those engaged in physically or mentally demanding work can retire, on certain conditions, at the age of 63, if they have been working for a minimum of 38 years.
  • The current part-time pension system will be removed and replaced with partial old-age pension. 

For more information about the reform, visit