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Parental leave and retirement planning in Sweden: how it affects your pension

When you become a parent, it's natural to focus on your little bundle of joy. But it's also wise to consider how parental leave can affect your long-term finances.


Below, we will explore some important aspects of how parental leave can impact your pension and provide insights on how you can ensure a stable financial future when you become a parent.


Download the LEIA Health app now to get the right guidance before, during, and after your parental leave.



The Swedish pension system

1. Pension and parental leave

In Sweden, most employees contribute to both their general pension and occupational pension.

While you continue to contribute to your general pension during parental leave, the rules for your occupational pension may vary.

It's important to find out if your occupational pension is affected by taking parental leave.


Ask your employer about the specific policies in place at your workplace.


2. Additional contributions

During the first four years of your child's life, there's a concept known as " pensionsrätt för barnår " (parental leave pension rights). This means the parent with lower earnings will receive additional contributions to their general pension.

It applies regardless of how parental leave is divided, and there's no need to apply separately. However, if you opt for part-time work after the initial four years, your contributions to the general pension will decrease.

3. Part-time work

It's important to note that short-term part-time work and parental leave may not have a significant impact on your pension, contrary to common belief.

However, for an extended period of part-time work, your pension will be affected. Here's an example from Pensionsmyndigheten.se:

A person employed in the public sector with a gross monthly salary of 35,000 SEK before tax can expect a reduction of around 800 SEK per month in their pension for life if they work at a 75 percent rate for 8 years.


In the private sector with similar conditions, the reduction would be approximately 1,100 SEK per month for life.


4. Balance your pension incomes

To balance pension incomes, consider transferring your future premium pension rights to your partner if they lose contributions due to parental leave or long-term part-time work during the early years of raising children.

The duration of this transfer can be decided by you. Another option is to set up separate savings specifically designated for the individual who works part-time for extended periods. Ensure that these savings cannot be divided if a separation were to occur.

" The Leia app has been like a reliable friend during my parental leave, and I'm forever grateful to my employer for making it possible."

By understanding how your pension is affected by parental leave, you and your partner can better plan for your shared economic future.


If you have additional questions about pensions or other aspects of finances, feel free to discuss them with each other or seek advice from experts for tailored information based on your specific needs.


Note that this information applies in Sweden; if you live elsewhere, different rules may apply.



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