Anticipated pensions: Luxembourg in the face of a strong increase

Figures that fall. While the social partners and the government are engaged in long negotiations – without an agreement has been found at this stage – the last report on the state of the pension system should provide them with a grain to grind.

Unsurprisingly, the dynamics demonstrate an uninterrupted increase in the total paid pensions: +37.5% between 2015 and 2024. Last year, 231,886 pensions of pension was paid, which represents a total of 6.8 billion euros for three types of pensions (old age, invalidity, survival). An amount more than three times greater than that which was spent in 2005.

“Luxembourg has the lowest retirement age of all EU and OECD countries, namely 60 years (…) We will make the effective age of departure come close to the legal age of 65,” said Prime Minister Luc Frieden, during the speech on the state of the nation. A first salvo that had triggered the wrath of the unions and the opposition.

The figures unveiled this Tuesday by the National Pension Insurance Fund are right on the observation. Last year, the number of anticipated old age pensions (11,980 in total) was almost triple to the number of old age pensions at 65 (4,512 in total). A figure that increases even faster than the others. Between 2020 and 2024, the number of early pensions requests climbed 46%. In 2024, the average age of an early pension beneficiary was 60.2 years old.

Luxembourg also observes the consequences of changing its labor market, where the number of cross -border workers has continued to increase over the decades. Thus, the number of pensions transferred abroad increased by 53.37% in ten years.

Last year, more than half of the pensions were paid to non-residents (51.6%). Logically, France (18.4%) arrives just behind Luxembourg (48.4%), but ahead of Germany (11.7%) and Belgium (9.7%). 4.4% of pensions are paid to residents of Portugal.