A summary of the new pension law

This July, the Future of Pensions Act went into effect. This law marks the beginning of a new pension system. Until January 1, 2028, we are in a transition period. From then on, all pension plans must comply with the provisions of this new law. But what does this really mean for your pension and for pensions in general?

The new pension system will be more personal. Everyone will have their own pension savings, based on a contribution promise. The pension fund will then invest this for you. As a result, the amount of the pension benefit can vary depending on the return of the investments. So in the new pension law, we no longer have the defined benefit pension. However, the monthly premium is fixed.

This approach is more about the individual than collectivity. However, the pension administrator can still opt for collective implementation, after consultation with employers and employee associations.

35 to 60-year-olds skip this phase

The new pension system is expected to eventually provide more pensions. For people who are not very young or very old, however, things may be different at this point. With the switch to individual pension pots, they can no longer benefit from collective deposits. The money that younger participants put in contributes more because it can be invested for longer.

People between the ages of 35 and 60 skip this phase in the new pension system. As a result, they are not benefiting from it and may have a pension gap. It is important to take this into account.

Changes to the partner's pension

There are also several changes in the partner and survivor pension. For example, the partner's pension will be made more uniform. Where previously the definition of a partner could differ from one pension plan to another, there will now be general rules. This also applies to the rules on registering a partner for the partner's pension and similar matters.

The rules for the partner's pension will become less standard, making it clearer to survivors what they can count on. For example, coverage will no longer be linked to length of service. In fiscal terms, the new pension system will allow a maximum of 50% of pensionable salary to be insured as a partner's pension. This takes into account the salary without deduction of an AOW deductible. This franchise is the part of the salary on which no pension is accrued. The orphan's pension will have a final age of 25 years. Also, the maximum pensionable salary will become 20%.

Individual pension pot

Previously, pension funds were committed to offering a pension of 70% of the average wage. This commitment will disappear with the advent of the new system. The individual pension pot will become decisive. The content of your individual pension pot at the time of retirement largely determines the monthly pension amount.

The pension system is going through a major overhaul, but there are also some things that will remain unchanged. You still retain the right to AOW. Your employer also determines where you build up your pension. As an employee, you do not have the freedom to choose where you build up your pension.

Do you have questions about the new pension law or would you like personal advice? Then don't hesitate to contact us. Our advisors will be happy to help you!