- 31/12/2024

Retirement planning: what you should know

4 min

The four pillars

First pillar: your legal pension

You build up your legal pension during your career. The pension you receive depends on the following:

• Your household composition
• The number of years you worked 
• Your status: self-employed, employee or civil servant 
• Your income: the higher your income, the higher your pension will be - to a certain extent 

In principle, today, you can retire at the age of 66. In 2030, retirement age will be raised to 67. You can find your career data and calculate your pension on mypension.be.

Nevertheless, in most cases, your legal pension will not be sufficient to maintain your standard of living. That is why we advise you to supplement this income with the help of the other three pension pillars.

Second pillar: the supplementary pension

The supplementary pension can be used to supplement your legal or state pension. How? Everything depends on your status:

• Are you an employee? Does your employer have group insurance or a pension fund? Your employer – and sometimes you, as an employee – will pay the premiums which are subject to a tax reduction. That way, you build up capital over time, in anticipation of your retirement. Employees whose employer does not provide a supplementary pension can take out a Free Supplementary Pension for Employees.
• Are you a contract agent? In that case, you may get a supplementary pension through your employer. Employers do not provide a supplementary pension for statutory agents. 
• Are you self-employed? In that case, you must take care of your supplementary pension yourself. 

Third pillar: tax-efficient savings

Employees, self-employed or civil servants... Everyone can build up tax-efficient savings. The earlier you start, the longer you save, and the more advantageous your supplementary pension will be. In addition, you already benefit from a tax advantage of 20 or 30% on your deposits!

You have three options:

1. Saving for your pension by paying money into a pension savings insurance (branch 21): the return is guaranteed. 
2. Saving for your pension by contributing to a pension savings account with an underlying pension savings fund: the return might be higher. 
3. Saving in the long-term by contributing to a savings insurance (branch 21): the return is guaranteed. 

Fourth pillar: tax-free savings and investments

In addition to the first three pension pillars, you can take advantage of other solutions (without tax advantages) to supplement your pension:

• Invest in funds, shares, bonds, or investment insurance 
• Saving money in a savings account or through savings insurance
• Invest in real estate, art, etc.

Where to start?

A custom solution

Ready to start saving for your retirement? You decide how much you want to pay monthly or annually. You can save through: 

• A pension savings fund – from 25 euros a month or 300 euros a year
• A pension savings insurance or long-term savings – from 30 euros a month or 360 euros a year

You can increase this amount any time you want. Would you like to put your savings on hold for a year? This is also possible. Remember that you will have to be very careful in the year you turn 55! What if you set up a direct debit with tax optimisation? This ensures that you save the maximum amount. 

Your tax reduction

With pension savings, you can save a maximum of 1,050 euros (basic tax-exempt ceiling) or 1,350 euros (higher ceiling) in 2025. 

Up to 1,050 euros, you benefit from a 30% tax reduction on the amount saved – capped at 315 euros. 

Did you save between 1,050 and 1,350 euros? In that case, you benefit from a 25% tax reduction on your payments – capped at 337.50 euros. You must also explicitly inform us each year and before your deposit that you have chosen the higher ceiling. 

Please note: if you opt for the higher ceiling of 1,350 euros, but pay less than 1,260 euros, your tax reduction will be lower than that of a person who has saved 1,050 euros. Find out more about your tax reduction and the one-off final tax. 

Reasons to save your money

Prepare for tomorrow by saving today

Would you like to live comfortably in old age, without changing your habits? It's not that simple, because your legal pension will be lower than your previous income. That is why it is so important that you save for your retirement. This will enable you to build up additional capital. 

Your advantages today:

Save for your retirement? Great idea, you will benefit from a tax deduction on your tax return every year. 

Your advantages in the future:

Consider the costs of a nursing home, for example. By setting money aside today, you will have more resources to live at your own pace later, after your retirement.

The sooner, the better

It's never too late to start thinking about your retirement. As soon as you earn taxable income, you can start to think about tax-efficient savings. If you are aged between 18 and 64, you can save for your retirement by making regular contributions to a pension savings fund or pension savings insurance. In short, the sooner you start, the more supplementary pension you will have in the long run. 

Rob has just been paid his first salary. Why should he already start to save for his retirement? Find out what he has to say. 

Pension savings fund or pension savings insurance?

Pension savings fund

A pension savings fund is a specific investment fund that allows you to save for your pension in a tax-efficient way.

The advantages of a pension savings fund:

• The possibility of accumulating more capital in the long term: your savings grow thanks to your payments and the returns on the fund's investments. 
• Diversification of risk: your money is spread across different asset classes such as shares and bonds. The impact that the poor performance of a share or asset class would have on your total investment is thus more limited. Given that your entry points are staggered (through annual or monthly payments), the risk of a 'bad' entry point is much lower. 
• Flexibility: with BNP Paribas Fortis, you can opt for a pension savings fund with a more defensive profile at any time and free of charge. 
• No end date: the capital accumulated in the pension savings fund is not automatically paid to you on the end date. You can withdraw it in full when you take your retirement as provided by the law, but you can also let it grow or request that payments be spread over time. 

Pension savings insurance

With a pension savings insurance (branch 21), you take the safe road to a comfortable retirement.

• Protection of your capital and guaranteed interest rate: with pension savings insurance, your capital is protected and you also benefit from a guaranteed interest rate for each payment until the end of your contract.
• Payment upon maturity: at the end of the contract, you are paid the capital you saved and the guaranteed interest rate.
• Possible profit sharing: each year the insurer may also share part of its profits with you and other policyholders. This is done in the form of profit-sharing. 

Pension savings or long-term savings?

With long-term savings, you set aside money for at least 10 years. This is an extremely tax-efficient way of saving. As with pension savings, you benefit from a tax reduction on the amount you pay annually or monthly. So how are they different from each other? 

Objective:

With pension savings, you build up additional pension capital for a more comfortable retirement. You can save until the end of the year in which you turn 64.

With long-term savings, you also build up additional pension capital to enjoy your old age more comfortably. If your contract allows it, you can even save until the age of 99.

Maximum annual deposit:

For pension savings, the maximum amount you can save each year is 1,050 or 1,350 euros.

For long-term savings, the maximum amount has been capped at 2,530 euros. But this also depends on your net taxable earned income and the tax advantages you benefit from with your property loan.

Tax on the premiums you pay:

No taxes apply to the premiums of your pension savings. For long-term savings, the tax amounts to 2%. 

Final tax:

The one-off final tax for pension savings amounts to 8%. It is 10% for long-term savings. You pay the final tax once-only when the payment/premium is included in your tax return, in the year you turn 60 years of age, or in the 10th year of your contract if it was concluded after your 55th birthday.