Doubts about the value of the future pension continue to mark the beginning of many workers’ professional lives. The possibility of achieving a retirement close to the last salary, although demanding, is not unattainable. A recent OECD study indicates that, in certain scenarios, the replacement rate can exceed 90 percent, especially when there is a long and uninterrupted career.
According to Executive Digest, a website specializing in economics and current affairs, which cites the “Pensions at a Glance” report, a worker who started working at the age of 22, in 2024, will be able to reach that level if they complete 46 years of contributions and retire at the age of 68. In this scenario, the net pension comes significantly closer to the income earned at the end of the career.
In the case of those earning the average salary, the estimated replacement rate is 92.7 percent, placing Portugal among the European countries with the best results in this indicator. According to the same source, this percentage remains above 90 percent for both lower incomes and higher salaries, demonstrating that contributory regularity has more weight than salary level.
Assumptions explain the high values
The numbers presented by the OECD differ from the calculations of other entities, such as the European Commission, essentially due to the criteria used. While Brussels works with hypotheses of shorter or discontinuous careers, the OECD study assumes that workers remain active and withdrawn until the legal retirement age.
This methodological difference results in higher replacement rates, close to the maximum allowed by the system.
In Portugal, the retirement age is indexed to the evolution of average life expectancy. For those who started working in 2024, the reference is 68 years old. Reaching this age without leaving early is crucial for those who want to minimize losses in the value of their pension, as early retirement involves significant cuts.
Impact of exit age
Early retirement continues to be heavily penalized. In 2025, the base reduction is 16.9 percent, to which is added an additional cut of 0.5 percent for each month in advance. The report classifies these penalties as severe, highlighting the direct impact they have on pensioners’ final income.
On the other hand, prolonging working life beyond the legal age allows you to benefit from bonuses that are greater than actuarial neutrality. This mechanism works as an incentive to remain in the job market, especially for those who want to increase their pension in the last years of their career.
There is also the possibility of accumulating pension and income from work after the age of 68. Despite being an advantageous regime, its uptake remains low. In 2023, only 14 percent of pensioners in Portugal were professionally active, a figure lower than the OECD average, which stands at 22.4 percent.
Weight of contributory continuity
The study concludes that the combination of a prolonged contributory career and leaving at legal retirement age is crucial to achieving a pension close to the last salary. Any interruption along the professional path translates into a reduction in the final value, while postponing retirement and taking advantage of available incentives can make a difference.
According to , ensuring a replacement rate close to 90 percent depends essentially on three factors: a long and continuous career, compliance with the legal retirement age and the use of mechanisms that value the extension of professional activity. It is in this balance that the possibility of transforming expectations into concrete reality lies.
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