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Pension insurance – what to do when you approach retirement age

Your voluntary pension insurance will supplement your statutory pension and safeguard your income level when you retire. Read here the tips on what to do as you approach retirement age and after you have retired.

Once you have reached retirement age, you can begin withdrawing your pension whenever it suits you. You can also defer the withdrawal of your pension. However, you must begin withdrawing your pension by the retirement age specified in the insurance terms and conditions. 

You should regularly review the investments linked to your pension insurance. In particular, before you start withdrawing your pension, you should check whether the risk level is suitable for you. For more information on investment options, please contact your OP cooperative bank.

How to begin withdrawing your pension

We will send you a letter showing your pension plan well in advance of the start of your pension. You can also find the same information by logging into the op.fi service.

In order to begin withdrawing your pension:

  • complete the pension payment notification, which you will receive by post.
  • post it to the insurance company or take it to your local OP cooperative bank.
  • ask the Finnish Tax Administration to deliver your tax card to OP Life Assurance Company if your pension includes payments that are taxable as earned income.

How to defer the withdrawal of your pension

You can defer the beginning and end of your pension by one or two years from the beginning of your retirement age. Following a deferral, you can defer the withdrawal of your pension by another one or two years.

If you want to defer the withdrawal of your pension:

  • complete the pension deferral notification, which you will receive by post.
  • post the appendix to the insurance company or take it to your local OP cooperative bank.

Note that the form must be delivered no later than two weeks before the start of your pension period.

Taxation of pensions – capital income or earned income?

Voluntary pensions are always taxable income. Pensions are taxed as earned income or capital income. The type of tax applying to your pension insurance is shown in the letter we sent and on the op.fi service.

If your pension is taxed as capital income, you do not need to provide a tax card. In such cases, withholding tax will be automatically deducted from your pension at a rate of 30%.

If your pension is taxed as earned income, please send your tax card to us. When you apply to the Finnish Tax Administration for a tax card for your pension, provide the pension plan that was sent to you. You can also ask the Finnish Tax Administration to deliver the tax card directly to OP Life Assurance Company.

If you do not deliver a tax card, your pension will be taxed at the withholding tax rate stipulated in the legislation (40%).

You can change the beneficiary and the investment instruments used for your pension savings

You can make changes to the beneficiary of death benefit and the investment instruments used for your pension savings on OP-mobile and the op.fi service.

You can make changes by:

  • logging into the op.fi service: Private customers > Savings and investments > Insurance saving > Select the contract you want to change.
  • to OP-mobile: Investments > Insurance saving > Select the contract you want to change.

Do you want to make changes to your pension plan?

The value of your pension is reviewed monthly or yearly, depending on your insurance terms and conditions. If your pension is paid in equal instalments, they will be paid for as long as your insurance savings last. If you want to make changes to your pension plan, contact us before the payment of your pension begins.

If your pension insurance includes unit-linked savings, the values of the investment instruments may rise or fall while you are withdrawing your pension. Therefore, the amount of your pension or the payment period may vary.