Pensioners’ average income level grows while income disparity widens rapidly

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Following the income trend among salary earners, the income gap between retired persons has widened in recent years, even though the differences between various pensions have not moved further apart.
      In addition to pension income, the most well-to-do pensioners have managed to accumulate wealth, having acquired a liking for investment income favoured by the tax authorities.
      According to the Finnish Centre for Pensions, the average earnings-related pensions have increased perceptibly, as the new pensions are higher than the old ones that will gradually cease to exist.
     
Economist Juha Rantala from the Finnish Centre for Pensions notes that basically Finnish earnings-related pension cover is good.
      At the same time, the risk of poverty among OAPs has grown, as the pensions have lagged behind earned income. More than 10 per cent of retired persons have to manage with nothing but the national pension. In 2007, this basic pension was EUR 445 to 524 a month.
      Those who are in the weakest situation include 75-year-old single women and male retirees under the age of 55 living alone on a pension.
     
According to Hilkka Häkkilä, the Chair of the Central Association of Finnish Pensioners (EKL), the majority of retired persons are still struggling for their livelihood.
      ”I am worried about pensioners on small incomes. They buy less food and halve their pills”, Häkkilä reports.
      The purchasing power of pensions will be negative by the end of the current year, and all increases will have been used. The prices of energy and food are going up, while rents will increase as well, Häkkilä lists.
     
At present, there are 1.3 million retired persons in Finland. Just under one million of them are enjoying a national old-age pension, while 267,000 people are being paid a disability pension, and 47,000 persons are living on an unemployment pension.
      The number of persons receiving a part-time pension is around 30,000.


Links:
  The Finnish Centre for Pensions
  The Central Association of Finnish Pensioners (EKL)

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