The Swedish pension system is hard on newcomers. The requirement to obtain the maximum guaranteed pension (garantipension) is with some exception, that the person has lived in Sweden for 40 years. This means that many foreign-born Swedes are left out of the basic protection.
About 225 000 pensioners live below the EU poverty threshold, according to the Swedish Pension Agency (called Pensionsmyndigheten in Swedish). The proportion of poor older people has increased dramatically since 2006. New Swedes makes up a significant share of this group. This highlights the growing challenges within the Swedish pension system.
The Swedish pension system is based on the principle that you work for your own retirement throughout your working life. There are different categories within the pension system and the bottom safety line is the so-called guarantee pension (garantipension). To receive the maximum guarantee pension, you must have lived in Sweden for 40 years. Today this pension is about 8.000 SEK per month. If you have lived in Sweden for a shorter period, the pension will be lower.
The Swedish pension system makes exceptions for people who come to Sweden as refugees seeking protection. However, the system does not extend these exceptions to many newcomers. This includes immigrants who receive a residence permit based on family ties.
Adding to the problem in the Swedish pension system is the fact that newcomers often have a weak position on the labour market. Many newcomers end up in low-wage occupations, which often lack occupational pension, called tjänstepension in Swedish, which is another pension category within the Swedish pension system.
Understanding the Swedish pension system
However, pensioners might be entitled to supplementary support. One supplement is the bostadstillägg, a housing supplement that might cover a part of the rent. The problem however, is that very few newcomers are familiar with how the social security system in Sweden works and do not apply for this additional support. The Swedish Pension Agency estimates that over 100 000 pensioners qualify for housing allowance but do not apply for it under the Swedish pension system.
There is also a maintenance support for older people, which is a type of social assistance for pensioners. The Swedish Pension Agency recommends pensioners to contact them to get more information about what support they may be entitled to.
Written by
The Career Sweden Team brings together experts in recruitment, communication, and relocation, all working toward one goal: helping international talents find their place in Sweden. We create clear, reliable guides and articles about Sweden’s job market, recruitment, and work culture — as well as practical, fact-based resources on everything that shapes life and career here.
Comments
One response to “The Swedish pension system is hard on newcomers”
asif MAsud
hi
Does it mean that the pension payout analysis which comes with yearly Pensions Myndigheten (Orange Envelope) based on your current earnings is giving fake picture or??
Asif
Comments are closed.