KPA Pension has reported early demand for its new option, allowing customers to pause and/or extend occupational pension payments, introduced at the start of 2025 for the municipal and regional sector.

The Swedish provider said 653 customers chose to either extend or pause their occupational pension during 2025, a move designed to increase flexibility and support longer working lives.

According to its report Increased freedom and security – A year of more flexible occupational pension withdrawals, which examined customer experiences and behavioural outcomes, the changes are already influencing retirement decision-making.

The research found that 30 per cent of surveyed customers would have made a different original withdrawal choice, such as starting later or spreading payments over a longer period.

KPA Pension said the option allows pensioners to re-enter working life more confidently, potentially boosting future pension income while helping address labour and skills shortages.

KPA Pension business area manager for partners and education, Fredrik Eklöf, said: “This new option is particularly valuable for those who regret their original choice or find themselves in a life situation with changed needs. The ability to adjust the payment, therefore, provides extra security and flexibility.”

KPA Pension has just over 200,000 customers with defined contribution pensions in payment. During 2025, 410 customers opted to pause their occupational pension — broadly in line with the provider’s forecasts.

Women accounted for 73 per cent of those pausing payments, reflecting the scheme’s overall gender profile. Customers choosing to pause payments varied widely in age: the youngest was 57, the oldest 79, and the median 67.

Pension capital ranged from around SEK 6,000 to several million kronor, with a median of SEK 230,000, while the median monthly pension payment was approximately SEK 3,800.

Customers must specify the duration when applying. The shortest permitted pause is three months, and the longest recorded so far is 10 years. The average break is two years, with 12 months the most common choice. The pause can also be interrupted or extended.

Among those pausing payments, 80 per cent had fixed-term withdrawals and 20 per cent lifetime payments.

A further 243 customers extended their payment period in 2025. Of these, 48 (20 per cent) switched from fixed-term to lifetime payments.

Most had originally selected the standard 10-year withdrawal period common in the municipal sector. Extensions typically ranged from one to five years, with five years the most popular and the average extension four years.

KPA Pension expects uptake to increase as awareness grows.

Eklöf added: “We believe that more people will take advantage of the opportunity to pause or extend their withdrawal period in the future, as we get around 30,000 new pensioners every year.”

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