"Mistrust in the pension system is major barrier"
Only two percent of people make an active choice the first time they are given a chance to invest in their so-called premium pension, the part of their national retirement pension they have control over.
Every year, people can choose where 2.5 percent of their salary is invested. This part of the pension is called the premium pension. And people can choose to invest from among 800 mutual funds.
Trust in the pension system is low and nothing suggests that more people will make an active choice in the future, according to Christer Nord from the Swedish Pensions Agency. He says mistrust in the pension system is a major barrier.
"People choose and guess, but there are few who would say they've really thought through their choice," says Erika Werner, the Lund University researcher who recently finished her thesis on the pension system.
The premium pension system was put in place in 2000. That year 66 percent made an active choice in what to invest in.
Werner says one of the main problems is that there are too many funds to choose from.
Ulf Kristersson, the Minister for Social Security, agrees that there are major problems in the premium pension system. The government recently decided to review the system.