The Netherlands’ Pension System: Key Information

Knowledge for getting the most from the advinda Premium goBenelux Pension Funds Package.

Population: 16.8 million

Pension system design

The Dutch pension system is designed with three pillars:

  1. pay-as-you-go state pension
  2. quasi-mandatory occupational and
  3. voluntary private pension arrangements.

Public Pension/Algemene Ouderdomswet (AOW) state pension

  • compulsory, financed on a pay-as-you-go basis by the workforce
  • basic income, level is linked to statutory minimum wage
  • financed by payroll taxes
  • in comparison with other countries this pension accounts for a minor part of the total contributions for old age
  • benefits are adjusted according to changes in the minimum wage and are subject to income tax.
  • full old-age pension is paid to everyone who has resided or worked for 50 years in the Netherlands between the ages of 15 and 65
  • retirement age increases to 66 years in 2018 and to 67 in 2021

Occupational Pensions

  • a) one of the best developed occupational pension systems in Europe
    b) largest pillar in terms of overall Dutch pension system
    c) generally not mandatory, but sector-wide pension schemes often stipulate compulsory membership for some occupations
    d) employer pays usually more than 50% of contributions
    e) approx. 90% of employers offer occupational pension schemes
    f) typically handled by an external pension provider

The Netherlands are one of the five biggest markets for pension fund investments (2015), together with United States, United Kingdom, Australia and Japan. These five countries cover more than 85% of OECD pension fund investments in 2015. (Source: OECD “Pensions markets in focus 2016” report)

Private pensions

Total investment of providers of funded and private pension arrangements equivalent to: 178.4% of GDP (2016)

Private pension assets 2016: $ 1,266,433.5 million USD (all forms of private investment with a value associated to a pension plan over which ownership rights are enforced by institutional units, individually or collectively. This indicator is measured in millions of USD; source: OECD)

Pension funds’ assets 2015: $ 1,266,433.5 million USD (assets bought with the contributions to a pension plan for the exclusive purpose of financing pension plan benefits. The pension fund is a pool of assets forming an independent legal entity. This indicator is measured in millions of USD; source: OECD)

Net pension replacement rate 2014: 95.7% (individual net pension entitlement divided by net pre-retirement earnings; measures how effectively a pension system provides a retirement income to replace earnings. This indicator is measured in percentage of pre-retirement earnings by gender; source: OECD)


Federation of the Dutch Pension Funds –

The Organisation for Economic Co-operation and Development (OECD) –

Sociale Verzekeringsbank –

European Actuarial & Consulting Services –

Government of the Netherlands –