In a new report, the Swedish Pensions Agency (Pensionsmyndigheten) has concluded that most premium pension savers who picked their own funds have had lower returns over time than if AP7’s default fund had been running their money.
In its 2025 report on value development and payouts in the premium pension – the defined-contribution segment of Sweden’s state pension – the agency said just over 13% of pension savers with their own fund choices had outperformed AP7’s default product Såfa since they entered the system, which some did as early as 1995.
Gustav Sundén, analyst at the agency, said: “Our report shows that the state default AP7 Såfa has worked well for the majority of savers. Relatively few people manage to achieve a higher value development over time through their own fund selections.”
The report also concluded that the more fund switches savers make, the worse the average value development.
However, the agency also said value development experienced by individuals picking funds for themselves from the premium pension funds platform varied more widely than among those in the default option.
While the report focused on outcomes over time, it also reported on results in 2025 alone – and the agency said that last year had bucked the trend with around half of the savers with their own fund selections having experienced a higher value development than AP7 Såfa in 2025.
“The year 2025 stands out compared to previous years,” Sundén said.
Last year saw a change in the way inheritance gains were distributed within the premium pension, marking the move to monthly allocations from annual, it said, adding that this had meant two years of gains were concentrated in 2025 – contributing to unusually high value development, especially for older pension savers and retirees.
The agency pointed to several upcoming events and developments that it said would make continued monitoring of the premium pension important – citing the normalisation of monthly inheritance gains, the Fund Selection Agency’s (Fondtorgsnämnden, FTN) procurements for the private funds platform, and the ongoing government investigation into how the premium pension system’s insurance forms work during the payout period.
“Any proposals from the investigation may, if implemented, affect the choices of pension savers and pensioners,” the pensions agency said.
The FTN’s procurements and the reallocations resulting from those processes would affect both fee levels and fund offerings, it said.
“This suggests, among other things, that future analyses should continue to make cautious interpretations of differences between own fund choices and pre-selections,” the agency said.
