"The best pension system in Europe". This country has overtaken Germany

Until recently, Germany was considered a model of economic order and discipline. Today, according to the eleconomista.es website, their place is taken by the Netherlands. This is where we have been observing strong economic growth, rising wages and, at the same time, extremely cautious budget policy for several years. Effect? The state does not fall into debt, and yet it manages to allocate more and more funds for pensions.

Comprehensive reform – what is changing in the pension system?

The Netherlands is currently carrying out one of the most profound pension reforms in recent decades. The changes will affect a total of 18.6 million citizens and concern primarily the so-called the second pillar - occupational pension funds, where EUR 1.8 trillion is accumulated.

Previously, there was a defined benefit (DB) system in which the amount of the pension was determined in advance - for example, 70%. final salary after 40 years of work. However, calculating and guaranteeing such payouts burdened the funds with high investment risk.

Now the Netherlands is moving to a defined contribution (DC) system. This means that:

- Each employee will have an individual retirement account

- The amount of the pension will depend on how much he saves and what profit the fund's investments will bring

- Higher payouts are potentially possible than under the current, conservative system

The new model resembles systems already used, among others, in Poland (PPK). Experts emphasize that it provides transparency, individualization and allows for better use of market opportunities.

Three pillars of the Dutch order

The pension system in the Netherlands is currently based on three pillars:

1. State Pension (AOW) – a basic benefit paid to everyone, financed by social contributions

2. Mandatory employee pensions - the vast majority of companies must offer their employees additional savings programs

3. Voluntary savings - individual accounts and plans for the self-employed or people outside large companies

The system constructed in this way has been considered one of the most stable and generous in the world for years. Now it is to be even more transparent and beneficial to participants.

What does this mean for Poles in the Netherlands?