Repayment

Pension payments

You can start withdrawing your private pension rights from the age of 60.  Fund members can choose between two types of payments or a mixture of both:

  • Withdrawals can begin at the age of 60. The value of the private pension account is paid out with monthly payments or you can receive the total value of the account in a lump sum.

  • Another choice is to convert the value of the account into an inflation- protected annuity that guarantees lifetime monthly payments. Any balance remaining in the account at the time of death goes to the Pension Fund, not the fund member´s heirs.

Illnesses or accidents

A fund member who becomes permanently ill or disabled, and is therefore unable to perform his work, has the right to receive the value of his private pension account over a minimum of seven years.

Death

The balance in the account at the time of death is divided among the fund member's heirs as provided in the Inheritance Act.

Example of private pension payments

Example of private pension payments when contribution is ISK 20,000 or ISK 30,000 per month and real investment rate is 4% p.a.

Savings time Contribution ISK 20,000 Contribution ISK 30,000
  Monthly payments
for 7 years
Monthly payments
for 10 years
Monthly payments
for 7 years
Monthly payments
for 10 years
10 years 35,264 26,095 52,896 39,143
20 years 92,206 68,232 138,309 102,348
30 years 176,494 130,605 264,741 195,908
40 years 301,261 222,933 451,891 334,399