YEL and pension security for the self-employed

YEL insurance provides financial security in different life situations while helping you build up your pension. It helps safeguard your livelihood in old age, in the event of disability, and in the event of the death of a self-employed person. Your earnings-related pension is accrued based on your YEL income.

How is a self-employed person's pension accrued?

As a self-employed person, your pension is built up throughout your working life from your earnings both as a self-employed person and as an employee. Certain social security benefits also contribute to your pension accrual.

As a self-employed person, you accrue earnings-related pension at a rate of 1.5 per cent per year based on your YEL income. The level of your YEL income determines how much pension you accrue from your work as a self-employed person.

You can track your pension accrual in your pension record in Varma Online Service.

Check your pension record in Varma Online Service

Read more about pension accrual

When can you retire?

Your retirement age is determined by your year of birth. You can easily check your retirement age using our pension calculator.

Check your retirement age with the pension calculator

Plan when to start drawing your old-age pension

It is worth considering the different options and your preferred retirement date well in advance.

  • If you start drawing your old-age pension, your YEL insurance will end automatically when the pension begins. You can continue working as a self-employed person after reaching retirement age, and YEL insurance is voluntary alongside an old-age pension.
  • If you do not start drawing your old-age pension at the earliest retirement age, you will continue to accrue pension based on your YEL income. In addition, the total amount of pension you have accrued will be increased through a deferred retirement increment if you retire after your earliest retirement age.

What retirement options are available for the self-employed?

YEL insurance helps secure your livelihood when you approach the end of your career or if your work ability changes. Depending on your circumstances, you can retire in several different ways.

You can apply for an old-age pension once you reach your earliest retirement age. Retiring does not mean that you must stop running your business. You can continue your business activities while drawing an old-age pension.

Read more about old-age pension

A partial old-age pension can give you greater flexibility if you wish to reduce your workload during the final years of your career.

You can choose to start drawing either 25 per cent or 50 per cent of your accrued pension before reaching old-age retirement age.

The minimum age for a partial old-age pension is:

  • 61 for those born in 1963 or earlier
  • 62 for those born in 1964

If your partial old-age pension starts before your earliest retirement age, a permanent early retirement reduction will be applied, reducing the amount of your pension.

Read more about partial old-age pension

If your illness becomes long-term and you need support to continue working, YEL insurance also covers vocational rehabilitation.

Read more about vocational rehabilitation for the self-employed

If continuing to work as a self-employed person is no longer possible, you may apply for a disability pension.

Read more about disability pension

You may be eligible for a years-of-service pension if you are at least 63 years old and have completed a working career of at least 38 years in full-time work that has involved significant physical or mental strain.

Read more about the years-of-service pension

If a self-employed person dies, their spouse and dependent children may be entitled to a survivors’ pension. A survivors’ pension helps secure the livelihood of the surviving spouse and dependent children during a difficult time.

Read more about survivors’ pension

Working as a self-employed person while receiving a pension

You can continue working as a self-employed person while receiving a pension, regardless of which type of pension you receive. Depending on the pension you are drawing, YEL insurance may be either mandatory or voluntary.

If you are receiving an old-age pension or a partial old-age pension, you can work without any earnings limit. However, disability pensions and years-of-service pensions are subject to earnings limits, which should be taken into account when determining your YEL income.

See guidance on YEL insurance alongside different types of pensions

Help with using our services

Take care of your YEL matters online

In our online service, you can, for instance

  • apply for a change in your YEL income
  • view your past and future YEL contribution
  • request an extended term of payment for an invoice

Sign in to the service using your personal banking codes.

Log in to Varma Online Service

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