Fund members entitlement to a lifelong pension are calculated in ISK and depend on the premium paid into the pension fund. Younger fund members acquire more entitlement than older fund members for the same premium, because the premium is more valuable the longer it is invested with the fund. This age related formation of entitlements ensures the equality of fund members in the acquisition of entitlements over their working life.
Fund members can check their entitlement with the fund on the funds pension portal.
The entitlement to a pension may be with more than one fund. In an application for a lifelong pension, a fund member can choose whether he wants the application to be forwarded to other funds to which he has paid.
Social security pensions (TR) are paid from the state treasury and are dependent on the pensioner's other income. According to the law, you must first apply to pension funds before applying to TR. When entitlements are low in a particular fund, it is often possible to have them paid out as a lump sum. If a fund member is entitled to a lump sum payment from an individual pension fund, it may be beneficial to withdraw it before applying to TR. It is important to check your entitlement with TR because they are important when deciding to take a pension.
A lifetime pension is paid monthly until the end of life according to accumulated entitlements.
