Työeläketoiminta

Työeläketoiminta refers to the system of earnings-related pensions in Finland. It is a statutory social security benefit that provides income for individuals after they have retired from work. The system is funded by contributions made by employers and employees, as well as self-employed individuals. These contributions are invested to generate returns that help cover future pension payments.

The amount of pension received is based on an individual's earnings history. A portion of their annual earnings, up to a certain ceiling, is accumulated as pension capital. This accumulated capital is then converted into a pension benefit upon retirement. Various factors influence the pension accrual rate and the conversion of pension capital into a pension, including age and specific policy choices.

Työeläketoiminta is managed by several pension providers, primarily private insurance companies and the Social Insurance Institution of Finland (Kela) for certain aspects. These providers are responsible for collecting contributions, managing investments, and processing pension applications. The Ministry of Social Affairs and Health oversees the legal framework and general direction of the earnings-related pension system. The aim of the system is to ensure a reasonable standard of living for pensioners and to promote economic security in old age.