Preliminary information on 2025 indexes: The earnings-related pension index will rise by 1.6 per cent and the wage coefficient by 2.1 per cent compared to 2024
The time of exceptional indexes is over. The Finnish Centre for Pensions estimates that the 2025 earnings-related pension index will grow less than the wage coefficient. As a result, a person who retires on an earnings-related pension in 2025 may receive a slightly higher index increment to their pension than a person who retires in 2024.
Two indexes affect earnings-related pensions: the earnings-related pension index and the wage coefficient.
The aim of the earnings-related pension index is to retain the purchasing power of pensions in payment. The wage coefficient, on the other hand, affects starting pensions: it brings the pensioner’s career earnings up to the level of the year of retirement.
The current estimate of the Finnish Centre for Pensions is that, in January 2025, the earnings-related pension index will grow slightly less than the wage coefficient. As a result, a person who retires on an earnings-related pension in 2025 is likely to receive a slightly higher index increment to their pension than a person who retires in 2024. The effect is similar also for the partial old-age pension.
“In the last two years, index adjustments were exceptional, which is why it was financially favourable for some to retire before rather than after the turn of the year. Now we are returning to normal. Working longer is more advantageous than retiring”, says Development Manager Heikki Tikanmäki from the Finnish Centre for Pensions.
The Finnish Centre for Pensions estimates that, at the turn of the year, the earnings-related pension index will rise by around 1.6 per cent and the wage coefficient by around 2.1 per cent.
Retirement should be planned and timed based on one’s own situation
Index impact varies in different life situations. A person who considers claiming a pension should also note the impact of continued work, taxation and Kela benefits on their pension amount.
The Finnish Centre for Pensions points out that a person considering retirement should claim their pension about one month before retirement.
The pension of persons who have already retired will automatically be increased with the earnings-related pension index at the beginning of 2025. In other words, they do not have to apply for the increase.
Indexes confirmed in October
The Ministry of Social Affairs and Health publishes the confirmed earnings-related pension indexes for 2025 at the end of October.
