Start saving now to supplement your pension
Every Finn is entitled to a statutory pension but it’s not necessarily enough to cover everything you’d like to do on your retirement.
But did you know that you can supplement your pension by starting regular saving well before you retire? If you want to make your retirement more comfortable, one suitable alternative is to save into investment funds. Money put aside during your career will add security and flexibility to your finances later so that you’ll be free to enjoy your retirement without having to worry about making ends meet. You’ve certainly earned it!
The sooner you start, the smaller the monthly amount you’ll need to save and the more likely you’ll have the means to fulfil your dreams come retirement. Add the effect of compound interest, and even small amounts saved each month can amount to a hefty buffer by the time you retire. Compound interest means that the interest you earn on your savings is added to the principal annually. As well as earning interest on the savings, you also earn interest on the interest itself.
It’s easy to neglect your savings when retirement feels like a long way away. But your life doesn’t stop at retirement. People are healthier and more energetic than ever, spending an average of 23 years on retirement – so you’ll have a whole new adventure to look forward to. (Source: Työeläke.fi)
Get an easy start to pension saving with fund investments
Some people have the time and willingness to manage their investments – which is perfectly fine. However, if you’re not one of them and want help in getting your savings work for you, you should consider investing in funds. Investment funds have many benefits. One of the best ones is to know that your money is in the care of a professional portfolio manager and their team of analysts. Investing in funds is the most effortless way to get started with pension saving.
By choosing an investment fund wisely, you can make a difference in the way the world will be when you retire. If you want to contribute to protecting the environment and human rights as well as better working conditions, find a fund that matches your values. We offer a large selection of funds with specific sustainability criteria.
We are happy to help you find the right fund for your risk profile and personal circumstances. If you want personal investment advice, you’re welcome to talk to our advisers, or you can try Nora, our digital investment adviser.
What about the risks?
When you start young, you’ll be able to take more calculated risks to potentially get a higher return because the impact of market movements on your investments tends to average out over time. As you get closer to retirement, you may want to take less risks.
And although it pays off to start saving as early as possible, it’s never too late to get started. In Finland, statistics show that people close to retirement, around the age of 55–65, are in fact the most active savers.
What if I need my savings before I retire?
Monthly saving in a fund does not commit you to anything or tie up your money. If you decide to save 100 euros a month, for instance, we’ll transfer the money from your account to the fund of your choice automatically. You can check the performance of your savings in Nordea Mobile or Netbank at any time.
It’s up to you if you want to save more, withdraw some or all of your savings or stop saving altogether. You’ll have the money in your account in just a few days. And when the situation allows you to start again, you can always resume monthly saving. Nice and easy, isn’t it?
If you don’t know how much your pension will be when you retire, you can use the pension calculator on the website of the Finnish Centre for Pensions at Työeläke.fi to get an estimateOpens new window. Visit their FAQ section to learn more about earnings-related pension.