4D·

My first time pension investing

Jup its final I cannot touch this for 42 years here in the netherlands maybee even longer

06.08

iShares Core MSCI World ETF

Bought x17 at €103.02

€1,751.34

3 Comments

TheFlyingChris@TheFlyingChris

Curious: How does pension it work in the NL? Are you using a private broker or a private pension company? (Ie. Why can’t you touch for 42y??

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thomas@thomasgeldboom

@TheFlyingChris Part 1: The Basics of the Dutch Pension System
The Dutch pension system is often described as a three-pillar model. Pension investing typically happens in the second and third pillars, so we’ll start by outlining these three pillars:

1. First Pillar – State Pension (AOW)
This is the basic government pension, called AOW (Algemene Ouderdomswet). Every person who lives or works in the Netherlands builds up AOW rights automatically. It's financed by the government through a pay-as-you-go system: today's workers pay for today's retirees.

Start age: Determined by life expectancy and subject to change. As of 2025, it's 67.

Amount: Depends on how long you've lived in the Netherlands (full AOW = 50 years of residence from age 17 to 67).

Individual savings or investing is not required for AOW – it’s automatic.

2. Second Pillar – Employer Pension Schemes
Most employees in the Netherlands participate in a collective pension scheme through their employer. This is the second pillar.

Mandatory in many sectors: Employees often automatically participate through collective labor agreements.

Contributions: Both the employer and employee contribute a percentage of the gross salary.

Investing: The pension fund pools contributions and invests them. You don’t invest it yourself, but your money is being invested for you.

These pension funds are professionally managed, and the investments are long-term: in stocks, bonds, real estate, etc.

Example: If you work in healthcare, construction, or education, your employer likely enrolls you in an industry-wide pension fund (like PFZW, ABP, etc.). You contribute around 20% of your gross salary (shared with your employer), and the pension fund invests this to build a retirement pot.

3. Third Pillar – Individual Pension Products
This is where pension investing comes into play on a personal level, especially for:

Self-employed individuals (zzp’ers)

People without access to a good employer pension

People with a pension gap (“pensioentekort”)

You can voluntarily invest for your retirement using special tax-friendly products, such as:

Pension investing accounts (“pensioenbeleggingsrekening”)

Annuities

Tax-deferred retirement savings

You do this through financial institutions like Brand New Day, ABN AMRO, DeGiro (what I use), Centraal Beheer, or Robeco.

What Is a Pensioenbeleggingsrekening?
✅ Definition
A pensioenbeleggingsrekening is a tax-advantaged investment account specifically designed for building up extra pension capital. You can think of it as a special retirement savings account where your deposits are invested in financial markets — typically in index funds or ETFs (stocks and bonds).

It’s not a regular brokerage account: it comes with restrictions and tax benefits. You can't just take the money out whenever you want.

🔍 How It Works: Step by Step
1. You Open a Special Account
You choose a financial institution that offers pensioenbeleggingsrekeningen (e.g., Brand New Day, ABN AMRO Pensioensparen, Robeco, Centraal Beheer, etc.). They offer you a platform to deposit money and automatically invest it.

Most providers let you choose between passive investing (index funds) and more active or personalized strategies. Many people go with automated portfolios based on their retirement age.

2. You Deposit Money – Within Tax Limits
Every year, you can deposit a maximum amount into your pensioenbeleggingsrekening. This maximum is based on something called your “jaarruimte” (annual tax-deductible pension room).

Your jaarruimte depends on:

Your income

The pension you're already building via an employer (if any)

A government formula

Example: If you're self-employed and earn €60,000 per year, and you have no employer pension, you may have a jaarruimte of around €10,000–€13,000 per year (just an estimate). That means you can invest up to that amount in your pensioenbeleggingsrekening and deduct it from your taxable income.

3. You Get a Tax Deduction
This is the main advantage of a pensioenbeleggingsrekening.

When you contribute to the account:

You deduct the contribution from your income tax.

That means you pay less income tax now, and postpone paying tax until retirement.

So, you're essentially investing gross income instead of net — allowing more capital to grow over time.

4. The Money Gets Invested Over Time
The money is invested automatically in diversified portfolios — usually containing a mix of:

Stocks

Bonds

Sometimes real estate or commodities

Your provider usually adjusts your portfolio risk as you get closer to retirement (this is called "life-cycle investing").
Early on, you're invested more in stocks (riskier, higher return potential). Later, it gradually shifts to bonds (more stable).

5. The Account Grows Tax-Free
While the money is in the pensioenbeleggingsrekening:

No capital gains tax

No wealth tax (box 3)

No dividend tax (usually)

Everything grows tax-deferred, which gives you more compounding power. You only pay tax later, when you retire and start withdrawing.

6. At Retirement – You Buy an Annuity (“Lijfrente”)
You cannot just withdraw the money freely when you retire. Dutch law requires that you use the money to buy a retirement income product — usually a “lijfrente” (annuity).

That means:

You use the total capital you’ve saved and invested to buy a financial product that pays you a fixed monthly income for a certain number of years (usually 20+).

During payout, you pay income tax — but usually at a lower rate, since your income in retirement is likely lower than during your working years.

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TheFlyingChris@TheFlyingChris

@thomasgeldboom thank you so much for this! Extremely comprehensive, much better than what I found online!
I’m looking to reallocate to the Netherlands at some point (I love the country and the culture) so this has been extremely enlightening!

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