The average intended retirement age in Finland has increased by almost two years over a 10-year period, according to the Finnish Centre for Pensions.

The analysis found that the intended retirement age in 2018 was 64 years and seven months, compared to 62 years and eight months in 2008. ETK economist Satu Nivalainen who has studied retirement intentions says the change is significant.

Nivalainen believes the change in retirement intentions indicates that wage earners have largely accepted the extending of working lives. Their intended retirement age has risen at the same pace as the retirement age for the old-age pension. In practice, raising the old-age retirement age by one year means the intended retirement age will also rise by one year.

The new research results also acknowledges the success of the 2017 pension reform. The aim of the reform was to extend working lives and postpone retirement. Studies show that wage earners’ retirement intentions greatly predict the retirement behaviour of future retirees.

“Extending working lives has been a central socio-political goal in Finland for the last 20 years. If future retirees adjust their retirement behaviour according to an old-age retirement age that is higher than that of previous generations, the basis of the pension system’s financial sustainability remains more solid. When assessed from this point of view, the 2017 pension reform seems quite successful”, Nivalainen said.

Of the workers that took part in Nivalainen’s study, every third intended to retire at age 65. Every fifth intend to retire at age 66 at the earliest. “65 years seems to mark a watershed. Nearly every third intend to retire before the age of 64, and every fifth at age 64,” Nivalainen said.

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