The figure describing the average pension may vary considerably depending on the point of view and the group under review. For this reason, one figure is not enough to describe the average pension; instead, we should review several different average figures.

Figure describing the average total pension depends on group under review

The statutory total pension consists of either an earnings-related pension or a national pension or both, and a possible guarantee pension. In addition, possible pensions granted on the basis of the military accident, motor liability and workers’ compensation insurance (SOLITA pensions) are also included in the calculations.

The average total pension calculated for all pension recipients is the average figure for the most extensive group possible of pension recipients. In 2019, this figure was 1,632 euros per month. The figure includes pensions paid abroad as well as survivors’ pensions.

Since the average pension paid abroad was 422 euros per month and the average orphan’s pension was 413 per month, the inclusion of these pensions reduce the average total pension.

If the group of pension recipients is limited to persons who live in Finland and who get only a pension based on their own employment history (pension in their own right), the average total pension at the end of 2019 was 1,716 per month. Part-time pensions and partial old-age pensions are not included in these calculations.

Table 1. Average total pension of pension recipients who live in Finland and who get a pension in their own right, by pension structure and gender and by 31 Dec. 2019

 Men Women Total
Average total pension €/month  1,937  1,533  1,716
share of earnings-related pension  1,810  1,384  1,577
share of Kela pension *  106  135  122
share of SOLITA pensions 21 14 17
 * includes the guarantee pension

Highest total pensions paid to pensioners on an old-age pension

When reviewed per pension benefit, persons on an earnings-related old-age pension got the highest total average pension: 1,803 euros per month in 2019. The average total pension of a person on a disability pension was 1,117 euros per month.

Average earnings-related pensions on the rise

At the end of 2019, the average pension of person living in Finland who got a pension based on their own work history (excluding persons on a part-time or a partial old-age pension) was 1,578 euros per month. This figure differs from the previously presented average total pension (€1,716) because, when calculating this particular average earnings-related pension, part-time pensions as well as survivors’ and national pensions have been excluded.

On average, new earnings-related pensions are higher than the pensions in payment. This is explained, partly, by the higher pensionable earnings of the younger cohorts and, partly, by the fact that pensions in payment are adjusted with an index that takes the changes in the economy’s real earnings level into account only in part.

The maturing of the earnings-related system can be seen in the fact that persons who have been retired already for a longer period of time have had a shorter time to accrue an earnings-related pensions than those who are retiring now.

The average earnings-related pension based on the person’s own work history of those retiring in 2018 was 1,598 euros per month, which is 60 euros more than for all recipients of an earnings-related pension.

The highest average earnings-related pensions are old-age pensions. At the end of 2019, the average pension of persons getting an earnings-related pension in the form of an old-age pension was 1,631 euros per month. The corresponding figure for persons retiring on an old-age pension in 2018 was 1,823 euros per month.

Table 2. Pension recipients getting a pension in their own right per 31 Dec. 2019 and new retirees on an earnings-related pension in 2018 and the average earnings-related pension per pension type.

Pension benefit No. Average pension EUR/month No. Average pension EUR/month
Old-age pension* 1,283,000 1,631 47,200 1,823
Disability pension 133,000 1,071 19,700 1,064
Farmers’ special pension 9,500 692 200 1,201
Total 1,416,1 1,578 67,100 1,598

* excluding those who get a partial old-age pension

Women’s average pension 69 per cent of men’s

On average, men’s earnings-related pensions are higher than women’s. At the end of 2019, the difference in the pensions in payment was 595 euros per month in favour of the men. The average earnings-related pension was 1,309 euros per month for women and 1,904 euros per month for men. Men’s larger earnings-related pensions are due to their longer working lives and higher wages compared to women’s.

If survivors’ pensions, national pensions and SOLITA pensions are included, that is, if we c0nsider the total pension, the difference shrinks to an 432 euros per month. In this case, the average total pension for men is 2,006 euros per month and for women 1,574 euros per month.

Average pension in relation to average earnings

Although the average pensions (excluding disability pensions) have increased in real terms already for decades, the average replacement ratios of disability pensions compared to the economy’s average wages have decreased by approximately 13 percentage points to an ample 35 per cent in the review period. For those receiving old-age pension, the average replacement ratio has remained at over 50 per cent of the average wage in the economy.

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