When you work, you earn pension. Earnings-related pensions make sure you have an income when you are old, you develop a disability, or the wage earner in your family dies.
If your earnings-related pension is small, or if you have not had income from work, you may get a national and a guarantee pension paid by the Social Insurance Institution of Finland (Kela).
Employer obligated to arrange earnings-related pension insurance
Earnings-related pensions are statutory, which means they have been set up in law. Your employer takes out the insurance on your behalf. When you work, you earn a pension, throughout your working life. If you are an employee, your employer will automatically withhold your share of the contribution from your wages. Your share of the contribution is listed on your payslip. If you are self-employed, you have to pay the total contribution yourself.
The pension providers collect the contributions, manage pension funds and grant and pay out pensions. As part of the collected contributions are funded, the investment return of the pension funds can be used to finance pensions. This way, the level of the pension contributions remain reasonable.
Check your pension record to see how much pension you have earned
Even if your workplace changes or you become self-employed, or the other way around, the data on the pension you have earned remains intact in the registers of the pension providers and the Finnish Centre for Pensions. You can check this data on your pension record.
Parliament enacts the earnings-related pension laws. The Ministry of Social Affairs and Health prepares the acts. The earnings-related pension laws are developed in cooperation by the State, employer organisations and employee organisations. Together, we all finance earnings-related pensions.