The average income level of a Finnish pensioner was equal to 77 per cent of the average worker’s income in 2020, according to research by the Finnish Centre for Pensions (ETK).

It found that the ratio had remained relatively stable during the assessment period (from 1995 to 2020).

The most well-off pensioners were those aged between 55 and 74 who live in a two-person household.

On the other hand, the lowest average income was found to be amongst single people aged under 55.

The poverty rate of pensioners was 13 per cent, around the same as the total population on average.

“Measured in different ways, the economic wellbeing of pensioners is, on average, relatively good,” commented ETK head of research, Susan Kuivalainen.

“As in other population groups, there are those who are better off and those who are less well off.

“Also, compared to other EU countries, Finnish pensioners are slightly better off than average.”

ETK noted that the income level of people who have retired largely reflected their financial status while working.

However, the economic wellbeing of retirees worsens slightly on average, while the economic wellbeing of those who retire from outside the labour force increases slightly.

In retirement, income levels were found to remain “fairly stable”.

“Central goals of pension policy are to retain a reasonable pre-retirement consumption level and to prevent poverty,” said ETK economist, Juha Rantala.

“For the main part, the aims are reached when we examine the status of retirees both in euros and in comparison to other population groups.”

Pensioners’ largest source of income was their earnings-related pensions.

In 2020, the average share of earnings-related pensions in the total income of pensioners was around 60 per cent, while the national pension made up approximately 5 per cent.

“Pensioners’ income as a whole consists of earnings from work and capital, and in which family plays a great role,” explained Rantala.

“For the low-income, the national pension and other minimum security received in one’s own right are emphasised.

“For those with an average income, earnings-related pensions are emphasised.

“For the high-income people, the earnings-related pension, the capital income and income from work are the most important sources of income.”

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