Icelandic Pension System

Membership in a pension fund is mandatory according to Icelandic law. The law states that minimum pension payments should be such, that upon retirement, an individual making contributions for 40 years should earn at least 56% of his average salary upon retirement.

Mutual insurance
Most Union agreements state that the mandatory contribution should be 15,5% of salary, of which the member contributes 4% and the employer 11,5%.
Due to high benefits per contribution it has been calculated, that to meet the requirements of the law, a 10% contribution is sufficient. This gives fund members the option to allocate contributions over 10% to their private pension plan.

Private pension
Lífsverk‘s private pension is an favorable and beneficial savings plan open to all.
You make contributions of 2% or 4% of your salary to the fund and your employer adds a 2% complementary contribution. Your contribution can thus double, instantly.
Private pension can fill the gap at the end of working life and beginning of pension.

For any further information, please send us an email or give us a call.