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The new pension law; here's what you need to know

Sep 20, 2023
3 min reading time

The way we build up pensions is going to be completely changed. Now pension funds work with a collective pot. In the future, they will rely more on individual pots. That means that from now on your pension will consist of all the premiums that have been paid and the returns that this money has generated. This will also make it clearer exactly how much pension someone has built up.

The new pension system should provide more flexibility and a better fit with today's labor market. In good economic times, more pensions can be paid out more quickly, and when stock market results are worse, cuts can be made sooner. However, it is stipulated that there must be certain buffers.

Flexible but risky

The new system should benefit people with flexible jobs and shorter contracts. More and more people are affected by this. It is also supposed to be more favorable for younger generations because they do not have to help pay for the higher benefits of older generations. Only the new system probably also involves more risk, there are no hard guarantees about the final benefit.

By Jan. 1, 2028, pension funds must transition to the new system. What exactly this will mean for the funds is not yet clear. The transition to the new way of building up pensions is likely to cost tens of billions.

Survivor's pension

If one is entitled to a survivor's pension, many rules will soon be the same for everyone. This makes it clearer what the survivor can count on. Coverage will be time-independent and there will be a change in the pensionable salary. This will be a maximum of 50% of salary in the new system.

Self-employed and new pension system 2023

ZZP'ers

The new system has major implications for employers and employees, but certainly also for self-employed workers. A lot is going to change for this group. The self-employed will be allowed - as an experiment - to participate in employee pension funds. In addition, the new law allows them to save more tax-free for their pensions.

Thanks to the various changes and the so-called third pillar (an individual retirement account), self-employed workers will have as much room to build up tax-advantaged pensions as employees.

In addition to the changes surrounding retirement, there is another important change for self-employed workers. For the self-employed, disability insurance will most likely become mandatory as of Jan. 1, 2027.

Want to know more?

Exactly how the pension system will be shaped will become clear in the near future. Do you have questions about building a pension? If so, please contact us.

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