Employment-based pension

Throughout their working life, all employees in Sweden earn income pension. In addition, many employers make extra monthly payments to a so-called occupational pension, which is based on collective agreements. Most Swedish residents also invest in private pension savings. 

The Swedish pension system is often pictured as a pyramid, with your basic income pension forming the base of the pyramid, your employer contributions in the middle and any personal pension savings plans you choose at the top. As mentioned, many employers contribute to your occupational pension (tjänstepension), but make sure to ask your employer about the agreements at your particular workplace. These contributions, and the interest earned, are added to your pension savings every year.

Although it is guaranteed by the state and funded partly by employer contributions, part of your pension, called premium pension (premiepension), is in your control. It is held in a personal account, which you can choose to place in any of a number of market-based pension funds.

Illustration: Invest Sweden

You can also choose when you would like to retire, with some people retiring as early as 55 years of age. But income pension and premium pension can only be drawn from the age of 61. 

Regardless of when you retire, however, the total amount of your pension remains the same. This means that the sooner you retire, the longer your pension will have to last. If you choose to go into early retirement, you should therefore be aware that your monthly payments will be reduced accordingly. It is also possible to keep working until the age of 67.

Read more about the Swedish state-funded guarantee pension