Fewer Finns aged 63 to 65 opting for retirement

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According to the Finnish Centre for Pensions, the 2005 pension reform has been more successful than was initially estimated.
      Since the pension reform, the retirement age of Finns has been rising. Fewer people aged 63 to 65 take retirement than previously, and more and more older citizens stay at work, thanks in part to the good employment situation.
      Following the reform, a person aged under 68 can stay at work being covered by pension insurance, thus having the prospect of a higher pension.
     
The retirement trend is measured by an indicator called the expected effective retirement age.
      Last year, the expected effective retirement age rose by almost six months for both 25-year-old and 50-year-old employees alike, the Finnish Centre for Pensions reported.
      However, the employment rate of 60-year-olds has grown particularly clearly.
      In addition, a number of retirees - including physicians, nurses, teachers, and cooks in the municipal sector - continue working.
      One of the objectives of the Finnish pension policy is to postpone the effective retirement in order that by 2050 the retirement age of all Finns would be three years higher than currently.
      The expected effective retirement age for 25-year-old citizens was 59.1 years in 2004 to 2005, while in 2006 the indicator rose to 59.5 years. The trend has been stronger than expected.
     
The Labour Force Surveys of Statistics Finland indicate a similar trend, with the employment rate of persons aged 60 to 64 having risen by almost 10 percentage points since 2004.
      Apart from the prospect of a higher pension, another factor that has effect on retirement is the fact that the pathways to early retirement have been restricted.
      In 2006, the largest group of employees took retirement at the age of 60, which is the age limit for a disability pension. The second largest group of retirees was 63-year-olds, and the third was the age of 65 years, which is the age when the old-age pension starts.


Links:
  Finnish Centre for Pensions
  Statistics Finland

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