The year 2024 is a significant one for the pension system in Sweden. It marks the start of the implementation of the new pension system, which was introduced in 1999. The current system is based on a pay-as-you-go principle, where the working population pays for the pensions of the retired. However, with an ageing population and decreasing birth rate, the Swedish government has planned for a transition to a more sustainable and fair pension system.
The new pension system, which will be fully phased in by 2024, is based on a mix of a notional defined contribution plan and a privately managed defined contribution plan. Under this system, each individual will have a personal account where their contributions and investment returns will determine their pension amount. This ensures that each person’s pension is directly linked to their own contributions and can be managed according to their own preferences.
Moreover, the retirement age will gradually increase, keeping up with the increasing life expectancy. This will not only make the pension system financially sustainable, but also allow individuals to continue working and earning even after reaching retirement age. This is especially beneficial for those who wish to retire later and have a longer working life.
Overall, the new pension system in Sweden in 2024 aims to be more flexible, transparent, and sustainable. It puts the responsibility of retirement planning in the hands of the individuals and gives them
