Exceptional earnings-related pension index development causes changes to Tyoelake.fi pension calculators
Because of an exceptionally high increase in the earnings-related pension index, the starting time for your pension matters if you plan to retire at the turn of the year 2022-2023. This has been taken into account in the form of age group limitations in the pension calculators on Tyoelake.fi. Compensatory information and examples are available on the website.
Due to the rapid rise in prices, the earnings-related pension index will grow clearly more than the wage coefficient at the beginning of 2023. As a result, if you retire in 2022, you will get a higher index increment than if you retire after the turn of the year (in 2023).
The timing of retirement on a partial old-age pension also makes a difference due to the exceptional index development. The time of retirement affects not only your partial old-age pension amount but also your consequent old-age pension amount.
Your access to the pension calculators at Tyoelake.fi has been blocked until further notice if you reach your retirement age in 2022 or have reached it earlier. This is because the calculators would provide incorrect information on how your pension would be affected if you deferred retirement to 2023. Instead of the pension calculators, we offer you information and examples on the effects of the index development.
If you were born in 1958 or earlier, you cannot estimate your old-age pension with the pension calculator. If you were born in 1961 or earlier, you cannot estimate your partial old-age pension with the calculator.
You should plan your retirement based on your own personal situation. Go to your pension provider’s website or contact your pension provider’s pension customer service for more information on how to plan your retirement.
The current projection of the earnings-related pension index by the Finnish Centre for Pensions is around 6.9 per cent. The wage coefficient, on the other hand, is expected to grow by around 3.7 per cent. We have based the examples here in Tyoelake.fi on these projections. The projections and examples will be updated throughout the autumn. The Ministry of Social Affairs and Health will publish the earnings-related pension indexes at the end of October.
Earnings-related pension indexes
Two indexes affect earnings-related pensions: the earnings-related pension index and the wage coefficient.
- The earnings-related pension index adjusts pensions in payment to secure their purchasing power.
- At the time of retirement, the wage coefficient adjusts career lifetime earnings to the level of the year in which the pension begins.
The earnings-related pension index puts greater weight on price development while the wage coefficient emphasizes earnings development. Both indexes are adjusted annually in January.