10,000 Finns Will Reach Retirement Age in
September 9, 2008
A record number of 9,700 Finns will reach the age of 63 this month. The age is the lower limit for the Finnish state retirement pension. The age group born in September 1945 will also manifest itself as a peak in the number of retired persons, even though the most common retirement age in Finland is 60 years.
Helsinki resident Ritva Jokinen is all smiles. She will turn 63 on the 23rd of this month, and intends to retire on the following week. Payroll administration in Espoo will be replaced by recreation on the Costa del Sol in Spain. ”My father was discharged from the military for Christmas in 1944. Fast timing”, she notes. Jokinen and her coevals belong to the largest age group of people born in the same month in the country’s entire population history.
Development Manager Ismo Risku from the Finnish Centre for Pensions estimates that the September 1945 age-cohort could be seen as a small peak on the retirement curve.
”We are now on the threshold after which the growth in the number of retired persons in proportion to the working-age population will start to accelerate. The share of retired persons in the population will continue to grow, while fewer and fewer people belong to the younger generation”, Ismo Risku reported.
The largest group in the so-called baby boomer generation involves those born in 1948. These 84,000 Finns are celebrating their 60th birthday this year. Until now people in Finland have retired at the age of 60 years on average.
”However, it is still pure guesswork to estimate when the number of retired people is actually expected to peak”, says Development Manager Jari Kannisto from the Finnish Centre for Pensions. The major reform in the Finnish private-sector earnings-related pension system that came into effect in 2005 did not encourage Ritva Jokinen to continue to work. ”My earnings-related pension would have risen by EUR 400 if I had continued to work until I am 68. Nevertheless, I found free time more tempting than money”, Jokinen notes. According to a recent forecast issued by the Finnish Centre for Pensions, Finnish pension expenditure will rise to EUR 20 billion this year.
In 2007, the expenditure on public pensions totalled EUR 19.6 billion, according to preliminary information issued by the Social Insurance Institution of Finland. Researcher David Sinclair from the National Public Health Institute has examined the Finnish demographic structure with some alarm. ”Finland will be the first country facing a population crisis. The most common age-group in Sweden and Britain is the 40-year-olds, compared with Finland’s 60-year-olds”, Sinclair reported.
Sinclair says that he is really disappointed to see how little Finns have been preparing themselves for the onset of old age. ”In the United States aged people leave for Florida, where they and their money can be taken good care of. In Finland many retired women live alone, and The Bold and Beautiful [a popular U.S. daytime soap] really does not entertain them for more than a few minutes”, Sinclair charges.
Many Finns born in the record September of 1945 have already entered the unemployment pathway to retirement, while some others have continued to work on a part-time pension. In any case, it will soon be more likely to run into a Finnish old-age pensioner than an underage Finn. According to a calculation made by Statistics Finland, the share of 63-year-old-and-above Finns will outnumber that of the under-18s in just two years. In 2010, the proportion of Finnish minors will decline to 1,080,000, while the number of over-63-year-olds will exceed 1,101,000.
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