The news is often about retirement. Then it usually goes about all old-age provisions as a whole, so in addition to the pension with an employer, also about the State Pension (in this blog we call this AOW). What exactly is the difference between the two?
Our pension system has three pillars:
A. AOW: you receive this State Pension from the government.
B. Pension through your employer(s), for example HEINEKEN. All our information is about the pension you accrue with the Heineken Pension Fund (HPF).
C. Also, individual supplementary schemes are possible, such as annuities or bank savings. We will not discuss this further in this blog. The HPF does not offer them. Whether you want to use it depends on your financial situation and the -probably very small- fiscal space you have left.
You will receive AOW as a Dutch resident. The amount of the AOW is linked to the minimum wage. It’s a basic facility. There is no correlation with the salary you have earned in your working life.
The age at which you will receive AOW depends on your date of birth. The AOW age will increase in the coming years. The AOW age is 66 years and 4 months this year, 66 years and 10 months next year and 67 years in 2024, 2025 and 2026. The AOW age in the following years depends on the development of the life expectancy. The AOW amounts are adjusted every six months, together with the minimum wage. Information about the AOW and your AOW age can be found at www.svb.nl.
Please note: If have you not always lived or worked in the Netherlands then your AOW may be lower.
No savings are made for the AOW. The AOW of the current AOW pensioners is paid by the current workers.
Pension through your employer(s)
The AOW is a basic provision, derived from the minimum wage. Pension is a condition of employment. In addition to the AOW, you accrue a pension through your employer in a pension fund during your working life. So, when you stop working, you will still have an income that is related to your previous salary. You can see it as deferred wages. The wages go into a savings account for the old age later. It’s a lot of money. At HEINEKEN, about a quarter of the wage bill goes into the pension savings account. You pay 1/3 of the pension premium, HEINEKEN the other 2/3. The HPF manages the joint savings account of more than four billion euros.
You can see how much pension you accrue through your employer’s scheme on your Uniform Pension Overview (UPO). Every year you will get your UPO from us. Would you like an overview of all the pensions you have accrued? Then go to www.mijnpensioenoverzicht.nl.