Between work, family, and daily commitments, retirement often seems far away. Yet when we hear about pension reform in Luxembourg, one question keeps coming up: will we have the same income as our parents once we retire?
Luxembourg has a pension system divided into three pillars. The first pillar, the statutory pension, is based on intergenerational solidarity: today’s workers finance today’s retirees. A generous model that has worked magnificently in the past, but one that must now adapt to a new reality.
A profound reform is inevitable. No one knows exactly what form it will take, or when. What is certain is that the longer it’s postponed, the more significant the adjustments will be. So rather than waiting and being subject to it, why not take control now?
The government recently announced an increase in the tax-deductibility ceiling for individual retirement savings, raising it from €3,200 to €4,500 per year starting in 2026. A strong signal encouraging everyone to take responsibility.
With a retirement savings plan like easyLIFE Pension, you build retirement capital starting from €25 per month. The state rewards you with a tax reduction of up to 45% of the amount saved. Concretely, each euro you set aside actually costs you much less. You can choose between guaranteed capital or a fund-linked formula for potentially higher returns.
And here’s an important detail: you can subscribe to a pension insurance plan until the day before your 65th birthday, even if you have already retired. This allows you to continuously benefit from tax advantages.
The supplementary pension scheme (RCP) remains largely underused in Luxembourg, yet it offers remarkable tax advantages for both companies that implement it and their employees. An employee who benefits from an RCP can supplement the premiums paid by their employer with personal contributions of up to €1,200 per year. These contributions directly reduce their taxable income each month. They therefore pay no tax on this money today, and since benefits are tax-exempt upon withdrawal, they won’t pay any when they receive their savings either. Immediate and future tax optimisation.
Are you self-employed? lalux-Safe Future allows you to invest up to 20% of annual net income with a flat tax rate of 20.9% and tax exemption at maturity. Transform your current tax burden into future security: a solution as pragmatic as it is effective.
First step: assess your situation. Check if your employer offers an RCP and complete it with personal contributions if possible. If you’re self-employed, set up your own RCP according to your financial capacity. This is the most tax-efficient lever in the short term.
Second step: subscribe to a retirement savings plan with a monthly amount compatible with your budget. Even modest, this regular effort, amplified by tax advantages, methodically builds your retirement capital.
The sooner you start, the less effort is required. This monthly commitment can have a considerable impact: the equivalent of one restaurant outing per month, say €50, already represents a significant investment in your future, especially since tax advantages substantially reduce the real cost of this savings effort. The statutory system will remain the foundation, but you will have diversified your income sources.
The debates will continue, and reforms will take shape. One thing won’t change: your ability to act today. Current tax advantages are concrete, immediate, and generous. They represent a real opportunity to prepare for your future while protecting yourself against the impact of upcoming adjustments.
The story of your retirement is being written now. What will yours be?
To learn more: calculate your own tax advantage with the easyLIFE Pension simulator.
