Receive retirement benefits and an old-age pension

Did you know that Luxembourg ranks among the top 10 countries in the world in terms of old-age pensions? So how do retirement pensions work in Luxembourg, who is eligible, and how?

Latest news about pensions in Luxembourg

Increase in pension contributions

From January 1, 2026, pension contributions will increase, with a direct impact on net salaries. The overall contribution rate for pension insurance will rise from 24% to 25.5% of gross salary, shared equally between:

• the employee: 8.5% (instead of 8%)

• the employer: 8.5%

• the government: 8.5%

Gradual increase in the contribution period

A broader adjustment to the pension systemprovides for a gradual increase in the contribution period and a reform of the system to ensure its long-term financial viability.

The pension scheme maintains the legal retirement age at 65, but for those wishing to take early retirement from the age of 60, there will be a gradual increase in the required contribution period:

• From July 1, 2026, an additional month of contributions will be required to retire at age 60 with a full career (40 years of recognized insurance).
• This increase in the required contribution period will continue between 2027 and 2030, up to a total of +8 months.

Who is eligible for an old-age pension in Luxembourg?

Social security contributions and pillars for old-age pensions in Luxembourg

All employees and self-employed workers in Luxembourg contribute 8% of their monthly salary to a national old-age pension fund. Employers also contribute the same amount on behalf of their employees.

These employee and employer contributions go into the employee's pension fund and constitute the first pillar of old-age pensions.

The second pillar of retirement pensions is financed by any pension plans set up by companies. These constitute an attractive benefit in kind for employees, significantly increasing the amount of their retirement pension.

The third pillar of old-age pension contributions consists of individual pension plans, in the form of capitalization savings offered by banks and insurance companies.

It is important to note that by voluntarily contributing to this third pillar through a private pension plan, you can deduct your old-age pension insurance contributions from your taxable income.

Find out more about the pension system in Luxembourg.

Retirement conditions and pension payments

Employees or self-employed workers are eligible for retirement and old-age pension payments in Luxembourg, provided they meet several conditions:

• Have reached the legal retirement age in Luxembourg, which is 65
• Have contributed to pension insurance for a minimum period of 120 months during their working life. These contributionperiods , known as "stages," may be mandatory (Articles 170, 171, and 172 of the Social Security Code), continued (Article 173), optional (Article 173 bis), or retroactively purchased (Article 174).
• Have worked for at least 12 months in Luxembourg

The 10 years of contributions may have been made in Luxembourg, but also in any EU country or in other countries that have signed a social security agreement with Luxembourg.

Years of study (up to 9 years) completed between the ages of 18 and 27, in Luxembourg or abroad, can be taken into account to reach the number of years of contributions required to trigger retirement. However, be aware of the final amount of the old-age pension paid, as these years are not subject to contributions!

Old-age pensions will be paid into your bank account.

Receiving an early retirement pension in Luxembourg

In Luxembourg, it is possible to receive an early retirement pension:

• from the age of 57, provided that the insured person can prove that they have paid 480 months of compulsory insurance contributions
• or from the age of 60, provided you have paid 480 months of insurance contributions, including 120 months of compulsory, continued, optional, or retroactive insurance.

For more information on old-age insurance contributions, see the Luxembourg Social Security Code.

You can increase your retirement income by signing up for a Retirement Savings Plan now.

Applying for and calculating your pension in your country of residence

Applicants for an old-age pension must submit their application to the pension fund of the country in which they reside. This application must be made a few months before the retirement age.

The country of residence then calculates pension entitlements based on its legislation and that of the country or countries where the insured person has contributed, in accordance with European or bilateral agreements. The insured person will receive benefits from each country where they have contributed, in accordance with the legislation of each of these countries.

If, upon reaching retirement age, the applicant does not meet the conditions for contributing to old-age insurance in Luxembourg as defined above, they may request a refund of the contributions they have made in Luxembourg (minus the employer's share). They will then lose the benefit of any Luxembourg pension.

For more information on old-age pensions in Luxembourg and to apply for a pension, visit the website of the National Pension Insurance Fund.

There is no official Luxembourg pension simulator. However, you can get a fairly accurate idea using the following pension simulators:

• Baloise simulator
• Cabexco

You can apply to the CNAP for a pension calculation from the age of 55.

If you are over 45 and looking for a job, you may find this article interesting for more arguments and competitive advantages...

Some figures on retirement pensions in Luxembourg

The amount of the retirement pension in Luxembourg is relatively high compared to other European countries.

The minimum pension received for 40 years of contributions in Luxembourg will be €2,244.82 gross as of January 1, 2024.
There is a cap on the maximum amount. According to the latest indices, the maximum pension amount is €10,392.67.

It should also be noted that the amount of pensions is linked to the index. Their amount is automatically adjusted when the index is triggered.

Those who have not spent their entire career in Luxembourg receive an average of €1,280.40 per month under the first pillar of pension contributions. Pensions from other countries in which they have worked are added to this amount.

Given the changing economic situation and labor market, it seems essential to reform the pension system in Luxembourg in the near future. Currently balanced, it is expected to be in deficit from 2027 onwards. This is now a key issue for the government.

Part-time work, self-employment, and pension insurance

In Luxembourg, it is important to note that part-time work and self-employment affect the length of time contributions must be made before retirement.

A part-time worker must work at least 64 hours per month for that month to be counted towards the contribution period.

A self-employed worker must work at least 10 calendar days per month for that month to be taken into account in the calculation of their pension.

In order to retire at the earliest at age 60, a worker may purchase insurance periods in the following cases:

• the worker has stopped working to care for their family
• the worker has contributed in a country that has not signed a social security agreement with Luxembourg.

Supplementary pension in Luxembourg

To best prepare for your retirement, you can also contribute to a supplementary pension with an insurance company. By taking out this type of policy, you will receive an additional pension benefit when you retire. You must have contributed for at least 10 years. This pension will be paid to you at the earliest at age 60 and at the latest at age 75.

By contributing to a supplementary pension, you will benefit from tax deductions on your taxable income of up to €3,200 per year.

Workers who have contributed to the compulsory pension insurance for 12 months in the three years prior to leaving the scheme may also opt for continued insurance while waiting to find a new job. The request must be made to the CCSS (Centre Commun de la Sécurité Sociale ) within six months of the end of compulsory contributions .

Update on the Luxembourg labor market.