YEL and private traders social security

What is YEL?

YEL or Pension insurance for the self-employed (Yrittäjän eläkevakuutus) is a statutory pension insurance for entrepreneurs. YEL insurance accrues pension for the self-employed. When applying for an YEL insurance, you need to set an estimate for your YEL income. YEL income refers to the monetary value of your work input. In a nutshell your YEL income must equal the annual salary that you would have to pay to an employee with the same professional skills as you have for carrying out the same work.

YEL income and social security

Private traders other social security benefits are based on YEL income. These can be..

• retirement, disability or partial retirement pension
• sickness benefit
• parental leave payment
• special care allowance
• rehabilitation allowance
• unemployment benefit
• survivors pension which is paid to the family of the private trader in case of a death

You need YEL insurance if..

• you are between the ages of 18 and 69*,
• you work in your own company or as a light entrepreneur,
• your self-employed activities continue for a minimum of four months, and
• your YEL income, i.e. the value of your work input, is at least 9,423.09€ annually and 785€ per month on average in 2026.

You have six months to take out the YEL insurance. This is called the six-month arrangement period. You must take the insurance within six months from when the insurance obligations are met. If you take out the YEL insurance late you will need to pay a penalty for neglecting to arrange pension cover.

How is the YEL income determined?

The confirmed income under YEL is an estimate of the monetary value of a self-employed person’s work input. YEL income does not mean the profit your company makes, your taxable income or the salary you pay yourself as an entrepreneur. You can edit the estimation if required. As long as your YEL insurance is in force, it is your responsibility to report any long-term changes in your work input. Inform us of changes in, for example, your turnover, working hours or sector. 

You can use VARMA's YEL income calculator to help with your estimation. 

I'm retired. Do I need the YEL insurance?

YEL insurance is not obligatory if you're retired due to old age*. You can choose to apply for the YEL insurance voluntarily even if you're retired. 

* For those born in 1957 or earlier, the upper age limit for YEL insurance is 68, for those born between 1958 and 1961 it is 69 and for anyone younger than this, 70 years.