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Overview of the Portuguese Three Pillar Pension System

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In order to cope with alleged future financial problems, several changes were made to the design of the Portuguese pension system since 2000. The aim was to achieve the diversification of retirement income sources across providers, both public and private, across the three pillars: public, industry-wide, and personal, and also across the financing forms of pay-as-you-go and funded. This paper describes these changes and analyses the results regarding, principally, the weight of each pillar and the investment performance of both public pension reserves and private pension funds. The main finding is that, in effect, there is one substantial longstanding pillar, and that is the public system.

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  1. Decree laws 277/93 and 288/93.

  2. Decree law 116/85.

  3. Before 2013, the SF was included in the pension formula, whenever the eligibility criteria was reached. At present, the SF is only applicable for early retirement.

  4. Before 2013, it was 2006.

  5. The differences in life expectancy for men and women are not used to calculate the new NRA.


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Financial support from national funds by FCT (Fundação para a Ciência e a Tecnologia). This article is part of the Strategic Project:UID/ECO/00436/2013.

I would like to thank J. S. Falzone for his comments at the 81st International Atlantic Economic Conference, Lisbon 16-19 March 2016, and the anonymous reviewers for their helpful remarks. All remaining errors are my own.

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Correspondence to Maria Teresa Medeiros Garcia.

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Garcia, M.T.M. Overview of the Portuguese Three Pillar Pension System. Int Adv Econ Res 23, 175–189 (2017).

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