Updated
Dutch retirement provision has three pillars and the first works differently from almost anywhere else. The state pension, AOW, is a residence-based universal scheme: entitlement depends on the number of years lived or worked in the Netherlands during the fifty years before state pension age, two per cent for each year, and not on earnings. Anyone who arrived in the Netherlands later in life therefore accrues a reduced AOW by definition. The second pillar is the workplace pension, usually compulsory through an industry-wide fund and, since the pensions reform, a contribution-based scheme with an age-independent premium in every case. The third pillar is individual and capped by the annual tax room. The calculators on these pages compute the pillars separately, because only their sum gives the replacement rate.
Pension Calculator Netherlands
Estimate your Dutch AOW state pension plus your occupational pension, understand the three-pillar system, and project your Lijfrente or Banksparen private savings.
Public Pension
Calculate your AOW (flat-rate state pension) based on residence years, plus your occupational pension from sectoral funds.
Private Pension
Project your Lijfrente (annuity) and Banksparen (savings account). Compare jaarruimte, tax benefits, and investment strategies side by side.
How it works
Choose a calculator
Public pension (AOW + occupational) or private savings (Lijfrente & Banksparen).
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Salary, residence years, pension accrual... adjust the sliders and see results in real time.
Understand and optimize
Charts, breakdowns, and educational content on the Dutch three-pillar system to help you plan ahead.
AOW retirement age
67 yrs 3 mo
Linked to life expectancy
Full AOW (single)
1 662 €/mo
After 50 years of residence
Accrual rate
1.875%/yr
Middelloon (average salary)
Jaarruimte max
35 588 €/yr
Annual tax-deductible space
Understanding the Dutch pension system
The Dutch pension system is consistently ranked among the best in the world and traces its origins to the Algemene Ouderdomswet (AOW), introduced in 1957. The system is built on three pillars: the AOW as a government-provided basic income, collective occupational pensions through sectoral and company pension funds, and individual pension products for supplementary savings. This three-tiered structure creates a broad safety net that guarantees a minimum income while also allowing room for customization.
The first pillar -- the AOW -- is a flat-rate benefit that does not depend on earned salary but on the number of years of residence in the Netherlands. After 50 insured years (between age 17 and the AOW age) you receive the full amount. The second pillar is managed by sectoral and company pension funds such as ABP, PFZW, and PMT. Most schemes are based on the middelloon (average salary) model: each year of service accrues a percentage of your average salary as a pension entitlement. The accrual rate is typically 1.875 % per year, meaning a 40-year career yields approximately 75 % of the average salary.
The third pillar offers opportunities for individual pension savings through tax-facilitated products. The Lijfrente is an annuity insurance product whose premiums are deductible from taxable income; benefits are taxed upon payout. Banksparen is the banking alternative with the same tax treatment. The maximum deduction is determined by the jaarruimte -- calculated as 30 % of the premium base minus the pension accrual in the second pillar -- and the reserveringsruimte, which allows unused jaarruimte from previous years to be carried forward. This third pillar is particularly relevant for self-employed workers (zzp'ers) who do not build up a mandatory occupational pension.
Key points
AOW and occupational pension
The Dutch pension system is built on three pillars. The first pillar is the AOW (Algemene Ouderdomswet), a flat-rate state pension funded through a pay-as-you-go system. The second pillar consists of sectoral and company pension funds, where employers and employees contribute together. These funds typically operate a middelloon (average salary) scheme: pension rights are accrued based on the average salary over the entire career, at a rate of approximately 1.875 % per year of service. Together, the first and second pillars form the backbone of retirement income in the Netherlands.
Retirement age and eligibility
The AOW retirement age is currently 67 years and is linked to life expectancy. To qualify for a full AOW benefit, you must have accumulated 50 years of residence in the Netherlands between the ages of 17 and the AOW age. For each uninsured year, your AOW benefit is reduced by 2 %. The occupational pension (second pillar) has its own retirement age, which generally matches the AOW age but may differ per fund regulation. Early retirement is possible but results in a lower benefit.
Lijfrente and Banksparen
The third pillar of the Dutch pension system encompasses individual pension products. The Lijfrente is a tax-advantaged annuity insurance where premiums are deductible from taxable income; payouts are taxed in box 1. Banksparen is the banking alternative: you save or invest in a blocked account with the same tax benefits as a Lijfrente, but without the insurance component. Both products are designed to supplement retirement income when the first and second pillars are insufficient.
Tax advantages
The tax deductibility of pension contributions is determined by the jaarruimte (annual allowance) and the reserveringsruimte (carry-forward allowance). The jaarruimte is the amount you may deduct in a given year for a Lijfrente or Banksparen product; it is calculated as 30 % of the premium base minus the pension accrual in the second pillar. If you have not fully used your jaarruimte in previous years, you can catch up through the reserveringsruimte (up to 7 years back). The maximum annual deductible amount is 35 588 EUR.
Pension transition (Wtp)
The Wet toekomst pensioenen (Wtp), adopted in 2023, fundamentally reforms the Dutch pension system. All pension funds must transition from the current defined-benefit schemes (average or final salary) to a defined-contribution system with personal pension assets. The transition must be completed by 1 January 2028. The goal is a more transparent and personalized system where participants gain better insight into their accumulated capital. Existing accrued rights will be converted (invaren) into the new system, unless a fund decides not to do so.
Frequently asked questions
What is the AOW retirement age?
The AOW retirement age is currently 67 years. This age is legally linked to life expectancy and is reassessed every five years. If life expectancy rises, the AOW age may increase accordingly. The government publishes the future AOW age at least five years in advance, so you can prepare. Up to and including 2027 the AOW age remains 67; from 2028 it is set at 67 years and 3 months.
How is the pension calculated in the Netherlands?
The AOW is a flat-rate amount that does not depend on your salary but on the number of years of residence in the Netherlands (a maximum of 50 years = 100 %). The occupational pension (second pillar) is typically calculated using the middelloon (average salary) scheme: each year of service accrues approximately 1.875 % of your pensionable salary minus the franchise. The total of AOW plus occupational pension forms your retirement income. With the introduction of the Wtp, pensions will be calculated based on accumulated personal pension capital.
What private pension products are available?
In the third pillar, the main products are the Lijfrente (annuity insurance with tax-deductible premiums), Banksparen (a blocked savings or investment account with the same tax benefits), and investing via a Lijfrente investment right. Additionally, the government offers the possibility to save through a netto Lijfrente beyond the tax-facilitated maximum (box 3 exemption). The choice depends on your risk profile, desired flexibility, and the size of your jaarruimte.
How much pension will I receive in the Netherlands?
Your total retirement income is the sum of your AOW (up to approximately 1 662 EUR/month for a single person with 50 residence years) and your occupational pension. The rule of thumb is that the total pension amounts to roughly 70 % of the last earned salary after a full career. You can check your personal pension overview at mijnpensioenoverzicht.nl. Keep in mind that under the Wtp transition, occupational pension payouts may fluctuate more in the future depending on investment results.
Can I retire early in the Netherlands?
Yes, early retirement is possible but has financial consequences. You can generally start receiving your occupational pension up to 10 years before the AOW age, but the benefit will be lower because it is spread over a longer period. The AOW itself cannot be claimed early. Since 2023, there is the option to withdraw a lump sum at retirement (up to 10 % of the pension value). Additionally, with sufficient third-pillar capital, you can bridge the gap until the AOW age.