Dutch pension system

During the years you have been living in the Netherlands, you and your partner build up an Algemene Ouderdomswet – AOW (state pension) , that is a basic state pension. In addition to this, you can set up a private pension for yourself and your partner. You can do this via a bank or an insurance company. They can advise you about the possibilities in your situation. Find more information about it at the  Social Security Office (Sociale Verzekeringbank – SVB) website. That is the organisation that implements national insurance schemes in the Netherlands: www.svb.nl.

In 2021 the statutory retirement age is 66 years and 4 months. In 2022 it will increase to 66 years and 7 months; in 2023 to 66 years and 10 months; in 2024 to 67 years. As from 2025 the pension age will be linked to the average life expectancy and thus could be greater than 67. Five years before your retirement date, the pension age will be final. You can calculate your expected retirement date on https://www.svb.nl/en/aow-pension/aow-pension-age/your-aow-pension-age.

The AOW is not designed to be a standalone income for retirees in the Netherlands and should be supplemented by a company/occupational pension (labour-based pension) or private pension scheme, or both.

1. The general old age pension (AOW). If you leave the Netherland, you stop building up your AOW. You will then get a reduced AOW pension when you reach the age at which you are entitled to this benefit. At the time you are retired, you might be able to receive the AOW you built up during your stay here. However, this is only possible if you are living in a country with which the Netherlands has a treaty at the time of your retirement.  For an overview of the current regulations for several countries please look at https://www.svb.nl/en/aow-pension/claiming-an-aow-pension-if-you-live-outside-the-netherlands/you-are-going-to-live-outside-the-netherlands.
2. The pension built up via your employer. If you leave the Netherlands, you might be able to transfer the pension you built up here to a pension fund in your new country. This is called international value transfer of your pension. It is advised to ask an expert to check if this is possible and if it is beneficial for you. He can also inform you about the steps to take.

For more information on this subject please visit the following website:

https://www.belastingdienst.nl/wps/wcm/connect/en/individuals/content/i-have-built-up-a-pension-in-the-netherlands-can-i-take-my-pension-to-another-country

If you live in the Netherlands at the time you retire, you are entitled to AOW. As you haven’t lived in the Netherlands all the time you will receive a reduced AOW.  If you don’t live in the Netherlands any more when you retire, you may be entitled to AOW if you live in a country that has a treaty with the Netherlands regarding social security. You can check what the regulations are for the country you are living in on https://https://www.svb.nl/en/aow-pension/claiming-an-aow-pension-if-you-live-outside-the-netherlands/deductions-from-your-aow-pension-if-you-live-outside-the-netherlands.

For international employers there are options to arrange an international pension plan. Companies offering this are usually international banks and insurance agencies.  Examples are Swiss Life https://www.swisslife-global.com/corporate/solutions/expats.html and Mercer https://www.mercer.com/what-we-do/wealth-and-investments/defined-benefit-pension-plans.html. These pensions can be called international pensions, mobile pensions or offshore pensions.

The Dutch pension system is made up of three pillars: Pillar 1 – The State or AOW (Algemene Ouderdomswet) pension, which is the basic pension paid out when one reaches the retirement age. The state pension is administered by the SVB  (Sociale Verzekeringsbank).  Workplace or company pensions funded by both employer and employee contributions. They are private or collective pension schemes connected to a specific industry, company or independent professional pension funds and are mostly managed by pension funds or insurance companies. Employees are entitled to choose their scheme preference within their pension fund. Updating your employer details with your pension fund is vital. More information is available on this website  . Pillar 3 – Private pension schemes are funded by personal contributions that are voluntary. Self-employed individuals and employees in industries that do not have collective pension funds contribute to this option.

To summarise: If you have lived or worked in the Netherlands, you will receive a state pension (Pillar 1) which will be calculated proportional to the number of years that you have worked in the Netherlands.

If you receive pension benefits from a work pension fund (Pillar 2) depends on if you signed a pension agreement with your employer and if you keep track of your Dutch pension scheme. How much you will receive depends on your salary and the number of years you worked. Should you die, your partner may be entitled to a part of your Dutch pension. If you are not married, it is essential to inform the pension fund you want your partner to be egilible of a part of your pension after your death. If you fail to do so, your partner may not be egilible to receive any money from the pension fund. 

You will only receive benefits from personal/individual pension (Pillar 3) if you took out a private pension.

If you live in the Netherlands, you will receive a letter about claiming your AOW pension about four months before you reach your AOW pension age. After you receive this letter, you can claim your AOW pension.  If you submit a claim earlier, your claim will not be processed.

If you live outside the Netherlands, you should apply for your AOW pension six months before you reach your AOW pension age. How to apply will depend on the country where you live.