Successful investment year increases pension assets to EUR 285 bn: pre-funding eases future payment obligations
For earnings-related pension providers, 2025 was a successful investment year. The total amount of investable pension assets in the earnings-related pension system was around EUR 285 billion at the end of the year, an increase of EUR 14 billion since the start of the year. During Q4, pension assets grew by EUR 6 billion. These data come from the latest statistics from TELA.
“Early last year, the stock markets’ performance was overshadowed by rising geopolitical and trade tensions, particularly the US administration’s trade stances. The stock markets fluctuated significantly from day to day at that time. However, as the spring progressed, market sentiment improved, and towards the end of the year the stock markets rose again,” says Mikko Mäkinen, Chief Economist at Tela.
The nominal return on earnings-related pension assets in 2025 was 7.4 per cent. The real return, adjusted for inflation, was 7.2 per cent.
“The weakening of the US dollar last year reduced the reported returns on US investments in euro terms. The dollar weakened against the backdrop of things like the administration’s unpredictable trade policy, concern about the federal deficit and uncertainty about the Fed’s independence. Investors’ confidence in the US dollar as a traditional safe haven was significantly shaken,” Mäkinen says.
“By contrast, the depressed trend of Finnish stocks that we’ve seen for a few years ended last year. The Helsinki stock exchange general index recorded an annual gain of over 30 per cent, one of the best. European stocks also performed well,” Mäkinen says.
Mäkinen says the investment outlooks for 2026 are moderately optimistic.
“The global economy is forecast to grow by just over three per cent this year. In particular, AI investments are expected to remain high, with inflation forecast to remain moderate. That said, geopolitical and trade tension could throw up surprises. Meanwhile, advanced economies are carrying a high level of public debt,” Mäkinen says.
Increased assets secure future earnings-related pensions
The purpose of the pre-funding of earnings-related pensions and investment of pre-funded assets is to reduce the pension contributions paid by employees and employers – now and in the future. When pensions are part-financed by funds and the returns they generate, pension contributions can be kept below the level that the pension outlays alone would require.
Increased assets are always good news, particularly from the perspective of pensions payable in the future, as more funds will be needed as the population ages.
“Today’s young people and children will also be contributing in part to the pensions of those currently in work. Even though the population is ageing and birth rates are low, pre-funding means that pension contributions charged on salaries won’t have to increase from the current level,” Mäkinen says.
The share of pension funds and their returns used to cover pension expenditure annually has grown over the years, and continues to do so. In the private sector, funds are used to cover just over a fifth of pension expenditure. That share will rise in the near future to a quarter. In other words, 25c of every euro paid as pensions will come from funds. That gives funds an important role in securing the financing of pensions.
Details on pension asset amounts
The amount of the pension providers’ investable earnings-related pension assets at the end of 2025 totalled EUR 285 billion. Assets increased by EUR 6 billion in Q4 of the year. In total, assets increased by EUR 14 billion last year.
In 2025, the nominal return was 7.4 per cent. The real return, adjusted for inflation, was 7.2 per cent. The long-term real return, since 1997, was 4.1 per cent.
The nominal and real returns per investment class in 2025 were as follows:
- equity and equity-type investments: nominal 10.6 per cent, real 10.4 per cent
- fixed-interest investments: nominal 3.8 per cent, real 3.6 per cent
- property investments: nominal 1.1 per cent, real 0.9 per cent
- alternative investments: nominal 4.5 per cent, real 4.3 per cent.
The figures for earnings-related pension assets compiled by TELA pertain to the pension assets managed by pension providers, pension funds, pension foundations, the Pension Fund for the Employees of KELA, KEVA, the Church Pension Fund, the Farmers’ Social Insurance Institution, the Seafarers’ Pension Fund, the Bank of Finland’s Pension Fund, and the State Pension Fund of Finland. Only statutory pension coverage is included in the statistics.
The pension assets for which TELA compiles statistics do not contain other receivables and debts or tangible assets recognized in the balance sheet. The earnings-related pension assets listed here refer to investable assets.
More detailed information on the amount and allocation of investment assets is available in full on the Amount of pension assets page of the TELA website. You can also browse data on the TELA statistical data base.
TELA will next publish statistics on pension assets, for Q1 2026, in May–June.
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