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The Estonian pension system consists of three pillars, two of which constitute a state pension, with the third being an additional funded pension. The state pension system provides income for a person in the case of old age or loss of a provider.

The I pillar of the state pension is funded with the taxes paid by current taxpayers, the II pillar is pre-financed – current taxpayers save money for their pension in advance. By making contributions to the supplementary funded pension, or the III pillar, the individual contributes to maintaining his or her standard of living even in old age.

The benefits of a three-pillar pension system

The three-pillar pension system is better suited to mitigating the risks to the sustainability of the pension system arising from the ageing of the population and economic and political developments.

I pillar pensions are paid to target groups under different laws. Pension comprises the largest share, being regulated by thу State Pension Insurance Act.

  • Old-age pension – state income intended for persons who have attained a pensionable age
  • Survivor’s pension – state income intended for families who have lost a provider
  • National pension – means a minimum pension for people who themselves or whose provider has not contributed adequately to the pension system and who therefore do not have the right to old-age or survivor’s pension

Other laws under which I pillar pensions are paid are:

I pillar pensions fall within the administrative area of the Ministry of Social Affairs and funded pensions within the administrative area of the Ministry of Finance. To apply for I pillar pensions, contact the Social Insurance Board.

To apply for II and III pillar pensions, contact your bank or insurance undertaking. II pillar and III pillar pensions are governed by the Funded Pensions Act.

Depending on the date of birth of the child, in some cases also the parent, the I or II pillar pension of the parent shall be increased depending on the number of children by adding years to the pension qualifying period, payment of the pension supplement or the state making contributions into the I and II pension pillar of the parent.

Once a year, in addition to the I pillar pension, the Social Insurance Board pays pensioners living alone an allowance for pensioners living alone.

Last updated: 05.09.2022