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As of 2009, the persons who have joined the 2nd pillar and attained pensionable age are entitled to receive the mandatory funded pension or 2nd pillar payments. Just like a pension-age person can choose the beginning of the receipt of state pension (1st pillar), they can freely choose the beginning of the payments of the 2nd pillar as well. When pensionable age is attained, there is no obligation to immediately use the 2nd pillar pension.
2nd pillar payments depend on the contributions made to the 2nd pillar or the size of wages, the collection period, the yield of the pension funds chosen and the age of the person. When payments are calculated, the gender of the person is not taken into account, that is, both men and women receive the same payments on the same terms.
Options for payments
The options for the payment of the 2nd pillar depend on the relation between the value of the assets accumulated in a person’s pension account and the rate of national pension. The purpose of the 2nd pillar is to provide additional income for a pensioner until the end of their life. The regulator has prescribed an opportunity to receive the funds in a shorter time as well – in case the value of the assets in the pension account is less than 50 national pensions.
If the value of the pension account is 10 times the national pension amount or less, you have the right to withdraw all the money at once.
If the value of the pension account is below 50 times the national pension, you are entitled to regular payments straight from the pension fund.
If the value of the pension account is 50 or more times the national pension, you must sign a pension contract with a life insurance company. On the basis of the pension contract, the life insurance company will pay regular pension until the end of a person’s life.
National pension is pension paid to persons who have no right to receive state old-age pension. The amount of national pension is changed once a year on 1 April. As of 1 April 2009, national pension is EEK 2008.80.
Applications for the payment of 2nd pillar pension can be submitted and pension contracts signed at all ERGO branches across Estonia.
Single payment from the pension fund
Regular payments from the pension fund
Lifetime pension contract
If the value of pension account is more than 700 national pensions
Taxation of 2nd pillar pension
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