General pension
The general pension is a state pension (allmän pension) that is provided to everyone who has lived and worked in Sweden. It is paid through the Swedish Pensions Agency, which has an official website: www.pensionsmyndigheten.se. Every year, money earned during work, study or maternity leave is credited to the pension account of each citizen. The general pension consists of three parts: income-based pension (inkomstpension), premium pension (premiepension) and guarantee pension (garantipension). Earnings-based and bonus pensions can be taken from age 61. Guaranteed pension – from 65 years of age. In 2013, the average general state pension was CZK 8,900 (after tax). For 6% of Swedes receiving an old-age pension, the total pension did not exceed 3,600 crowns, for 34% it was in the range of 3,600–8,300 crowns. 7% of pensioners lived outside the country.
Help for the unemployed
Unemployment benefits in Sweden are paid to everyone who already worked in the country, but for one reason or another lost their job. Such payments are called arbetslöshetsförsäkringen
The average benefit amount is calculated by A-kassa employees. This is an insurance organization, of which every officially employed citizen is obliged to become a member.
During the period of his employment, a person makes contributions to the cash desk. If he is fired, benefits are paid from his savings.
When a person begins his working career, he needs to clarify which A-kassa covers the scope of activity of a particular company.
You can learn more about life in Sweden in the video below.
This information can be clarified from trade unions or from specialists in the HR department of the employing company.
One of the most important conditions for receiving financial assistance from the state is a clear length of service. A person must work at least 80 hours within six months. If a Swedish citizen worked part-time, then the total number of hours during six months is 480.
If during the billing period a person did not work for a valid reason, it is extended. Inpatient treatment and care of a small child is recognized as a valid reason.
Sometimes the billing period includes work in other countries of the European Union, as well as in Switzerland. This point needs to be clarified in advance with A-kassa specialists.
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How is the benefit calculated?
Unemployment benefits are calculated as follows:
- It is based on average income for the last 12 months before dismissal.
- For the first 200 days, the applicant receives up to 79% of the average salary.
- All the following days the person receives 69% of the average salary.
For the first 3.5 months of receiving cash assistance, the applicant can count on 911 CZK/24 hours. The “ceiling” for the following days is 759 CZK.
Cash assistance is subject to income tax.
You can learn more about unemployment and benefits in Sweden from the video below.
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How long does government assistance last?
The maximum that an unemployed person can count on is 300 days. For parents with small children, temporary cash assistance is paid for 450 days.
All this time, the unemployed must actively look for a new job.
If during a job search a person took part in one of the Aktivitetsstöd projects, this period is included in the future insurance period.
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Memo to non-members of the cash desk
If a temporarily unemployed person who is 20 years old has not joined A-kassa, he will be paid Grundbelopp. Its size is 364 CZK/24 hours.
The calculation of such benefits is based not on the average salary, but on the number of hours worked. If there are few of them, then Grundbelopp will be small.
There are also private insurance policies available throughout the country in case of job loss. The managers of many companies encourage even their most valuable employees to purchase such insurance.
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2. Premium pension
2.5% of wages and other taxable payments goes annually into a pension account for a future premium pension (premiepension). The money for this pension is invested in various funds consisting of securities or shares, of which there are numerous owners of different people. You decide for yourself which equity funds to invest your money in. When you put money into a fund, you are buying a small share of that fund. As the value of securities increases, you and other fund owners will receive more money. When the value of a fund's securities or shares declines, owners receive less cash. Thus, the size of the bonus pension depends on how much and in what funds the future pensioner has placed money, as well as on the development of the value of shares and securities held in them.
Labor pension for long service
The long-service pension (tjänstepension) is a salary deduction paid by the employer. Most people who are employed are entitled to such a pension. Students, unemployed people or those working in enterprises that do not have a collective labor agreement, as well as private entrepreneurs do not receive long-service pensions. There are several organizations that pay pensions for long service. They enter into contracts with various employers. The size and payments of such pensions vary depending on the decisions of trade unions and employers.
Private pension funds
Sweden also provides for such a measure to increase social protection as pension insurance funds.
A fund in Sweden, designed to ensure a dignified old age, is a very popular type of financial activity for citizens - 38% of Swedes transfer part of their income to increase their own pension savings.
There are two ways to participate in a private pension fund. First, become his client, which implies an individual pension plan, according to which a set amount is paid monthly. Another option is to simply open a special bank account, to which you can transfer any amount at any time, depending on your desire. The invested funds will be returned to the client either in the form of payments from the pension fund or in the form of bank interest.
The country also has a high level of medical and social services for pensioners. This social protection measure is guaranteed by the Health Law of 1982, which provides equal quality of medical services for all segments and groups of the population.
It is noteworthy that students who receive the profession of both doctors and paramedical workers undergo practical training in Sweden in a boarding home for the elderly. Among these trainees there are also immigrants from Russia and other countries of the post-Soviet space; students consider their participation in social assistance for the elderly to be a good experience in introducing them to the humanistic values of Swedish society.
Retirement age
In 1913, Parliament set the retirement age at 67 years. On July 1, 1976, it was reduced to 65 years. A person decides for himself when he wants to retire. The later you retire, the larger your monthly pension payments will be. Earnings-based and bonus pensions can be taken from age 61. The guaranteed pension is paid upon reaching 65 years of age. People usually retire at age 65, but they have the right to continue working until age 67. If you want to work longer than this period, you can negotiate this with your employer. You yourself can decide the amount of pension payments. You can receive from 25 to 100 percent of the accrued pension monthly. You can, for example, receive half of your pension benefits and continue to work part-time.
Swedish pensions
This article briefly outlines what is important to know for those born in 1940 or later who want to know about their future pension. You can also read about how pensions change depending on the situation in the country and your retirement age. For example, you have the right to start receiving a pension (in Sweden the pension consists of different parts, which we will talk about later) from the month you turn 61 years old. But the longer you postpone this moment (preferably until you are 65 years old or even older), the more money you will receive every month.
It is important to know that everyone must apply for their pension themselves from the Swedish Social Insurance Administration (Försäkringskassa)
.
On a special form ( ansökningsblankett
) you answer certain questions, attach the necessary information and they determine what kind of pension you will receive.
What is important to know if you are starting to think about retirement?
If you live and work in Sweden for a long time, your pension will consist of different parts. One part of it is called general ( allmän pension
).
It in turn consists of inkomst-, tilläggs-, premie-
and
garantipension
(see below for more details on these parts).
The general pension is assigned to the Försäkringskassa
. Every year you receive a large orange envelope in the mail telling you how much you have already earned and how much you will receive.
You will receive another part of the money from your employer ( tjänstepension
).
Most receive approximately 10% of the salary they had before retiring. You can check your amount ( allmänn pension + tjänstepension
) on a special website www.minpension.se.
If you also personally save money into any pension funds, then you can find out from them what you can count on, and they will send you their calculation ( pensionkalkyl
).
What does it consist of and what influences the size of your allmän pension?
Each working year adds new money to your overall pension
.
Additions to this part of the pension occur in the form of certain pension contributions. You pay part of it yourself in the form of income tax ( skatt
), and part is paid by your employer.
These two contributions create so-called pension rights ( pensionsrätter
) and amount to 18.5% of the part of your salary that counts as the basis of your pension.
16% of them are added to the part that depends on your salary, and 2.5% is the so-called premium pension ( premiepension
).
In addition to the time when you received a salary, the time when you were at home with small children, studying, serving in the army or was sick is also taken into account. This part of the pension contribution is carried out by the state. All your rights to a pension are listed below: 1. The part of your salary that is contributed to the pension is collected in a special pension account ( pensionskonto
). The total value of this account depends on all pension entitlements throughout your life and the amount of annuity from this account. Rent depends on changes in the level of average wages in the country. In recent years the rent has been approximately 3%.
2. Premium pension account ( premiepensionskonto
). The bonus pension (2.5%) is saved in special securities funds that you choose yourself. The higher your salary, the more you place in these funds. In other words: the size of your bonus pension depends entirely on your salary and how well your money is invested. You can choose up to five different funds and you can always transfer money from one fund to another for free if you think that another fund has more favorable conditions.
If you have not made an active fund choice, they are automatically allocated to a special pension fund called Premiesparfonden
.
This is a general joint stock fund, which is managed by the seventh AP fund ( AP - allmän pension
).
The growth of this part of your money is registered in your individual account with the Office of Premium Pensions ( PPM -Premiepensionsmyndigheten
). The income from this part of your money varies depending on how well or poorly the funds in which your money is placed are developing. This can be tracked by the invoices that you will receive from PRM.
New pension system
In 1994, the government introduced a new pension system. The most important reason for this was that the old system required more and more financial resources, which became increasingly scarce as people live longer and there are fewer jobs. But there was another reason for changing the pension system. The fact is that the previous so-called ATP
the system did not take into account, for example, the income of those people who worked all their lives and whose salaries were constantly increasing. The new system tracks changes in salary and other income throughout a person's life.
The new rules for calculating pensions fully apply to those people who were born in 1954 or later.
Components of the new pension.
The general part of the pension consists of three parts - a pension from your income, a pension from bonus funds and a guaranteed pension.
If you were born between 1938 and 1953, then your pension also consists of three parts: the first two are the same, and the third is called the added pension ( tilägspension
).
This part is calculated in accordance with the old rules for the ATP system and the so-called “folkpension ”
.
The earlier you were born, the greater your added pension will be. The pension ( inkomstpension
), calculated from your salary and the years you have worked, and the added pension are the two largest parts of your future pension.
The pension from securities funds ( premiepension
) began to be calculated only in 1995. Therefore, for those people who are already receiving a pension or are going to receive it, this part is very small.
As for those who have not earned a pension at all, or it is too small, then such people have the right to a guaranteed pension ( garantipension
).
Both rights to a pension and its amount may change.
The pension, which is calculated depending on your salary, always changes depending on changes in the country's economy. That is, the better things go in Sweden, the higher your pension will be. The state of the country's economy is measured, in particular, using inkomstidex
– an index depending on the size of the average salary. This is the same figure that changes the annuity in your retirement account (in recent years the annuity has been quite stable - approximately 3%).
The part of the pension that is calculated depending on the funds you choose will depend on changes in these funds.
How is your pension calculated?
When you decided to retire and sent a request to försäkringskassa
, then your pension (
inkomstpension
) is calculated by dividing the money that has accumulated in your pension account by a special figure called
delningstal
. This figure is calculated depending on the average life expectancy of your peers or, in other words, how many years on average you will receive your pension (meaning for life). That is, the older you are, the lower this figure will be, the higher your pension will be.
The added pension is calculated as 60% of the 15 years during which you received the highest salary. To receive a full pension, you must work for at least 30 years. This form of pension only applies to those born between 1938 and 1953. The earlier you were born, the higher your added pension will be.
The pension is recalculated every year
It is important to keep in mind that the two parts of your pension, inkomst-
and
tilläggspension
will be recalculated at the end of each year.
This is because your salary and other factors that determine your pension change from year to year. The only difference is that the size of the pension itself varies depending on the average salary, but the so-called tillväxtnorm
, which is equal to 1.6%, is also taken into account.
This means that if, for example, inkomstindex
(which changes depending on the increase or decrease in the average salary in the country) increases by 3%, then these two parts of your pension will increase by only 1.4% (3 – 1.6 = 1. 4).
If, for example, inkomstindex
increases by only 1%, then these two parts of your pension will decrease by 0.6% (1 – 1.6 = –0.6). When things get worse in Sweden, the pension decreases. In other words: when the market situation is low, pensions do not grow as quickly as prices.
Continue working or retire? Work longer and increase your pension.
In Sweden, the retirement age for men and women is 65 years. You, however, have the right to work until you are 67 years old if you want it and your employer agrees to it. And even longer. The longer you work, the higher your pension will be. This increase depends partly on the fact that you continue to receive a salary, and partly on the fact that your pension is calculated for fewer years (which, remember, depends on the average life expectancy of a generation). The increase in your pension is approximately 10% for each year you work after age 65.
For those born between 1938 and 1953, there is a special rule called garantiregel
.
This means that they are entitled to the same two parts of the pension ( inkomstpesion
and
tillägspenion
) as if the pension was calculated under the new pension system that came into force in 1994.
If you belong to this category, then perhaps your work after 65 years will not give you an increase in your pension. It is better if you specifically consult försäkringskassa
before you continue to work after retirement age.
You decide for yourself when and how you will start receiving your pension.
You have the right to receive three parts of the pension ( inkomst-, tilläggs-
and
premiepension
) from the very month you turn 61 years old. But the longer you work and do not take a pension, the higher it will be.
You can start receiving a guaranteed pension only when you reach 65 years of age.
You can receive your pension not only in full (100%), but also in part (25%, 50% or 75%) and you can continue to work all day or part of the day. If you continue to work, then the pension, of course, is recalculated upward every year. Your inkomstpension, tilllägspension
and
garantipension
you must always take in equal shares. As for the premiepension, you can decide absolutely independently whether you will take it in its entirety or part of it.
You have the right to manage that part of the pension yourself, which is called premiepension
: You have the right to transfer money into a traditional insurance policy or leave your money in those securities funds that you yourself have chosen (no more than five funds) or in
the Premiesparfonden
.
If you choose an insurance policy, all your securities will be sold and you will receive a certain guaranteed amount every month. If you leave your money in securities, the amount you receive may change depending on how things are going in these funds. Please note that you cannot change your initial decision later.
The article is based on the information brochure “ Arbete eller pension?
”, published
by Försäkringskassan
. Translation: Mikhail Lyubarsky
Discuss the article on the Swedish Palm forum.
Useful links:
Article "" Arbete eller pension?
” in Swedish
Forsäkringskassan
PRM funds (forum topic)
Benefit for the elderly
Persons aged 65 who are not receiving a pension are entitled to old age benefits (äldreförsörjningsstöd). This benefit can also be paid to those who have a very small pension. In 2013, the average benefit for the elderly was 3,625 kroons (tax-free).
~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~ Comments from the author of the repost -
The average pension in Sweden is approximately 6-7 times higher than the average in Russia. Where did we sin so much, huh? :))
