Survivors’ pensions reformed – new calculator helps assess the pension amount
Earnings-related survivors’ pensions were reformed as of the beginning of 2022. As a result, both the surviving spouse’s pension and the orphan’s pension were amended. The amendments do not apply to surviving spouses whose spouse passed away before 2022. Tyoelake.fi has introduced a new calculator that can be used to calculate the pension received by the surviving spouse and the orphan(s).
Survivors’ pensions paid to the surviving spouse and the children secure the family’s income after the death of the other spouse or parent. The amendments that took effect at the turn of the year reflect changes in society and family structures.
“The new legislation has improved the status of families with children in particular,” says Senior Adviser Suvi Ritola (Finnish Centre for Pensions).
The main amendments of the reform of survivors’ pensions include:
- The surviving spouse’s pension is paid for a fixed term for recipients born in 1975 or later.
- The orphan’s pension is paid until the child turns 20. Before, the age limit was 18.
- A long-term common-law spouse may qualify for a surviving spouse’s pension if the spouses lived together for at least five years and have a child together.
- A computational surviving spouse’s pension may be paid to the children if there is no surviving spouse entitled to the pension.
The new calculator used to estimate the pension amount paid to the surviving spouse and the orphan(s)
The new calculator in Tyoelake.fi can be used to assess the amount of the surviving spouse’s pension and the orphan’s pension. The results of the calculator are indicative; the pension provider that grants the survivors’ pension will calculate the final amounts.
The calculator estimates the shares of the deceased spouse’s or family breadwinner’s pension paid to the surviving spouse and the orphans, as well as the reduced surviving spouse’s pension.
The survivors’ pension is based on the earnings-related pension of the deceased spouse or family breadwinner. The surviving spouse’s own pension may reduce the amount of the surviving spouse’s pension. The calculator calculates the reduced surviving spouse’s pension based on the amount of the deceased person’s pension and the surviving spouse’s own pension entered into the calculator.
Surviving spouse’s pension for a fixed term
As of the beginning of 2022, the surviving spouse’s pension is paid for a fixed term in certain cases.
Surviving spouses born in 1975 or later can receive the surviving spouse’s pension for ten years or at least until the youngest of the children turns 18. The minimum period of ten years does not apply to common-law surviving spouses who are paid the surviving spouse’s pension until the youngest of the children entitled to an orphan’s pension turns 18.
Surviving spouses born in 1974 or earlier may continue to receive the surviving spouse’s pension until their death, as before.
New tool reveals right to surviving spouse’s pension
The new online tool of the Finnish Centre for Pensions can be used to find out if a surviving spouse is entitled to the surviving spouse’s pension and for how long it is paid.
The data provided by the tool is based on the information entered into it. The tool offers a preliminary assessment of whether the surviving spouse is entitled to a surviving spouse’s pension. The final decision is issued when the surviving spouse’s pension is claimed.
Expansions to the orphan’s pension
The orphan’s pension is now paid until the child turns 20. Previously, the payments ended when the child turned 18.
The rising age limit applies to
- new orphan’s pensions that began in 2022 or later,
- orphan’s pension recipients who are under 18-years-old at the beginning of 2022: under the new rules, their survivors’ pensions continue until age 20.
What is new is that the surviving spouse’s pension may be paid to the children if there is no surviving spouse entitled to the surviving spouse’s pension. The child may be entitled to this computational share if, for example, a common-law spouse does not meet the requirements of the surviving spouse’s pension or if the surviving spouse is under 50 and remarries and the surviving spouse’s pension ends. This applies to children to married or common-law spouses.
The amount of the survivors’ pension depends on the number of beneficiaries. In a family with many children, the share paid to each child is thus smaller than in a family with only one child. On the whole, however, the surviving spouse’s pension is the larger the more children there are in the family.
Who does the reform not apply to
The reform does not apply to survivors’ pensions already in payment and surviving spouse’s whose spouses have passed away before 2022.
The fixed-term nature of the surviving spouse’s pension does not apply to married surviving spouses born before 1975.