08.07.2026
For more than two years, all II pillar investors have been able to increase their personal contribution to the II pillar to four or six percent of the gross salary. This year, nearly 11,000 Estonian residents have done so. In total, more than 118,000 people have decided to boost their future financial security more actively.
According to Vahur Vallistu, Chairman of the Management Board at LHV Varahaldus, the active increase in the contribution rate to the II pillar demonstrates the increasingly broad willingness of the people in Estonia to take the lead in shaping their financial future. “Looking at Estonia’s population pyramid and the state’s steadily rising expenses for social benefits makes it clear that proper financial security throughout the life cycle will be all the more the responsibility of each individual in the future,” he said. In a situation where the relationship between working people and pensioners is trending towards the latter, it is difficult to maintain even the current average state pension at the current level of social tax.
To create a more carefree retirement, saving additionally on your own is one of the most effective strategies. The second pension pillar is the main financial buffer for many people in Estonia, offering a convenient and tax-efficient solution for this purpose. According to Vallistu, the possibility to increase the personal contribution in the II pillar to four or six percent of the gross salary is one of the most important initiatives of recent years, whereby the state promotes the future financial security of Estonian residents. “The numbers speak for themselves, and we see that this opportunity is being actively used. At the same time, the most popular option is six percent, which will increase the future pension the most,” Vallistu noted.
Across the market, the wave of increasing the II pillar contribution rate usually begins in late autumn, as the cut-off time for making the decision approaches. Unfortunately, every year there are also a number of people who want to increase their contribution, but delay making a few clicks of the mouse for too long. “With the fast pace of life, things can easily go unnoticed. If you want to give the growth of your second pillar assets an extra boost, it is worth acting now,” Vallistu said.
Contributions to the second pillar can be increased until 30 November, and the new contribution levels will take effect from 1 January. According to Vallistu, every year they hear stories about how people assume they have until the end of December to make a decision. “It makes sense to find a moment and take the necessary steps as soon as possible to get the guaranteed tax win next year. Then it is certain,” Vallistu said. If desired, the decision can be changed until 30 November, and the application can be withdrawn. It is also possible to change the contribution rate of the II pillar in the following years, i.e., a person always has the freedom to choose. However, it should be borne in mind that the contribution rate chosen as of 30 November will apply throughout the following year.
The II pillar contribution rate can be increased through your home bank or the website www.pensionikeskus.ee.
LHV pension funds are managed by AS LHV Varahaldus. Please refer to the prospectus and key information available at lhv.ee/en/second-pillar, and seek guidance from a professional. Past performance is not a promise or indication of future performance. The value of invested capital is not guaranteed. The average return for the period is presented as the annualized geometric mean return.
All news