Swedes Told to Prepare for Retirement at 71

STOCKHOLM - Anyone relying only on the state's timetable should mentally prepare to retire at 69, 70 or maybe 71.

That is the message from Camilla Hellén, the new pensions expert at Swedish investment bank Avanza, in a post aimed at people born in the 1980s, 90s and 2000s. The old norm of retiring at 65 is already gone.

Sweden's so-called target retirement age is linked to life expectancy and rises automatically as people live longer. Hellén calls it the pension system's thermostat. The point is that monthly payouts should not be thinned out just because the money has to last more years.

For those born in 1959 or earlier, the target age is 66. For those born 1960 to 1965, it is set at 67. For everyone born in 1966 or later there is only a forecast so far.

Her message to the younger generations is blunt: "Prepare yourselves mentally for 69, 70 or maybe 71 if you rely only on the state's schedule."

What the official forecast says

Avanza gives no source for the 69 to 71 estimate. The latest forecast from the Swedish Pensions Agency, updated on 9 October, is more precise.

For those born 1970 to 1981, the forecast is 68. It then rises to 69 for those born 1982 to 1997, and to 70 for those born 1998 to 2014.

Only for children born 2015 to 2017 does the forecast point to 71. The forecasts are recalculated every year and can go up or down before the age is fixed.

Not compulsory - but a smaller pension

The target age is not an age people must work until. But it decides when the public income and premium pension can first be drawn - as a rule of thumb, three years before the target age.

Anyone who draws their pension early gets a lower monthly amount for the rest of their life. The guaranteed pension and housing supplement are only paid once the target age is reached. Occupational pensions and private savings are not automatically tied to it.