This article covers the rules for AFP in the public sector for those born after 1962. The rules differ significantly from the scheme that applies to older cohorts. If you were born before 1963, we recommend reading this article on AFP for older cohorts.
Conditions at age 62
To be entitled to AFP, you must, in seven of the last nine years before turning 62, have had your main employment with an employer affiliated with the AFP scheme in the public or private sector. The position must have been at least 20%, and the income from this position must have been higher than any other income, such as:
- Pensions from other employment
- Self-employment income
Transitional rules apply to those born between 1963 and 1966, where the seniority requirement gradually increases from 3 of 5 years to 6 of 8 years.
Benefits that may affect entitlement to AFP
Benefits without a duty to work, such as a gift pension, severance payment, or release from the duty to work, may result in loss of entitlement to AFP if received between ages 59 and 62. Exceptions apply to benefits below NOK 195,240 per year (1.5G).
Conditions at the time of drawing the pension
When drawing the pension (from age 62 or later), you must have been employed by a public sector employer with an AFP scheme for the last three years. Some absence is permitted, depending on the reason:
- Up to 104 weeks due to illness
- Up to 26 weeks for other absence
Disability benefit from the National Insurance Scheme after age 62 always results in loss of entitlement to AFP.
Calculation of AFP
AFP is calculated on the basis of all pensionable income in the National Insurance Scheme up to 7.1G (currently NOK 924,136) per year, at a rate of 4.21%. Accrual applies up to and including the year you turn 61. The pension is paid for life and is calculated by dividing the accrued amount by the National Insurance Scheme's divisor for your birth cohort.
No requirement to leave employment or reduce income
There is no requirement to leave your position or reduce your income in order to draw AFP. Nor is there any requirement to draw the state retirement pension from the National Insurance Scheme at the same time.
Conditional occupational pension – an alternative
If you do not meet the conditions for AFP, you may be entitled to a conditional occupational pension. This is accrued from 1 January 2020 and is calculated on the basis of the pension foundation in the occupational pension scheme, capped at 7.1G. The pension is paid for life based on the divisor.
AFP – three variants across the two sectors
AFP in the public sector has two different variants depending on when you were born. The scheme distinguishes between those born before 1963 (the older group) and those born after 1962. For the younger group, the scheme resembles AFP in the private sector and provides a higher pension the longer you remain in employment.
| Feature | Public sector – two variants, with a new model for those born after 1962 |
Private sector |
|---|---|---|
| Lifelong benefit |
No, for the older group. Yes, for those born after 1962. |
Yes |
| Requirement to leave employment |
Yes, fully or partly for the older group. No, for those born after 1962. |
No |
| Requirement to draw state retirement pension simultaneously | No | Yes |
| Accrual |
See separate article for the older group. 4.21% of income up to 7.1G for those born after 1962. |
0.314% per year of pensionable income |
| Conditions at age 62 |
Must be in the public sector position at the time of drawing (applies to all). Gradual transition to 7 of the last 9 years in an AFP organisation under the new AFP model. |
7 of the last 9 years with a private AFP-covered company |
| Income reduction and settlement |
Yes, for the older group. No, for those born after 1962. |
No |
| Alternative if entitlement is not met |
Not for the older group. Conditional occupational pension for those born after 1962. |
No |
Read more about the rules for AFP in the public sector if you were born before 1963.
Read about AFP in the private sector for more information on conditions and calculation in the private sector.
