Small business owners urged to prioritize robust pension insurance

This opinion piece, published in Helsingin Sanomat, offers a perspective from a small business owner urging fellow entrepreneurs to reconsider their approach to statutory pension insurance, known as YEL. The author expresses bewilderment at the prevailing discussion, which often overlooks a fundamental aspect: the direct correlation between YEL contributions and the eventual pension received.

The writer, who has been an entrepreneur since 2010, admits to paying a higher YEL than strictly necessary, a conscious decision to secure her future. She emphasizes that YEL's impact extends beyond retirement, significantly influencing sickness and disability benefits. In cases of serious illness or inability to work, a higher YEL provides a more substantial safety net, a crucial consideration often dismissed by those focused solely on minimizing immediate costs.

There's a clear critique of the prevalent mindset among many small entrepreneurs who view YEL as a burdensome, distant expense, advocating for the minimum possible contribution. The author acknowledges the financial strain but poses a vital question: how can one manage in retirement, or during unforeseen health crises, without adequate provision? While alternatives like investments or selling a business are mentioned, the author finds YEL to be the most reliable method for ensuring a pension. This piece highlights a tension between short-term financial prudence and long-term security, a dilemma particularly acute for small business owners in Finland.