Many people take entrepreneurship as a path to freedom and higher income. But in retirement, reality often turns out to be more complicated. What looks like a saving in taxes today can turn into a noticeable drop in living standards in decades.
Working “on yourself” has its advantages. the ability to influence your own income. But the other side of the coin often shows itself when it comes to the amount of the pension. Many self-employed people set their contributions over the years in such a way as to save as much as possible, only to discover in old age that they saved mainly on their own pension.
Low contributions, low pension
In the case of self-employed persons, the amount of pension is mainly determined by how much they have contributed during their lifetime . And this is where the biggest problem is.
Many self-employed people only pay the legal minimum. In practice, this means that their assessment base is significantly lower than that of employees. And it is from this that the pension is calculated.
Why the employee sometimes turns out better
At first glance, this may sound illogical. How can a minimum wage person have a higher pension than an entrepreneur?
The reason is simple. The employee does not pay social insurance himself. The employer also pays a significant part for it. The total contributions are thus higher than for a self-employed person who only pays the minimum.
For example, from the minimum wage, which amounts to 22,400 crowns in 2026, more than 7,000 crowns per month goes to social insurance. That’s an amount that many self-employed people can’t afford with minimal deposits.
What does the pension consist of?
The pension has two parts. The basic amount is the same for everyone, but the second – percentage – depends on the amount of income and contributions during life.
And this is where the differences between people are most apparent. The lower the contributions, the lower the percentage and thus the total pension.
Even years of work may not be enough
Many people think that if they work for 30 or 40 years, they must automatically have a decent pension. However, this does not apply to self-employed persons.
The duration of the insurance is important, but if the contributions are low all the time, the resulting pension corresponds to it. In some cases, the pension thus moves only slightly above the minimum threshold.
The state helps only partially
The system is set up so that no one is left completely without income. There is a so-called minimum pension, which is supposed to ensure a basic standard of living.
But the reality is different. It is usually an amount that covers only the most necessary. In larger cities, it is often not even enough for normal living expenses.
What to take from it
Experience shows one thing, the pension needs to be resolved in time. For the self-employed, relying only on the state usually does not pay off.
There are more options. Some voluntarily increase their social security deposits, others save or invest. But it is important to start on time and not rely on the fact that it will be solved somehow. It won’t solve.
As real-life stories show, the difference between a decision today and reality in retirement can be surprisingly large.
