What is the fourth pillar?

The fourth pillar is the capital you build outside the official pension framework that can contribute to your income later. Think of freely invested capital, savings, a paid-off home or a rented-out property.

For comparison, the four pillars:

• First pillar: state AOW.
• Second pillar: pension through your employer, under the Pensioenwet.
• Third pillar: a lijfrente you arrange yourself, with fiscal deduction.
• Fourth pillar: free capital, without tax relief but also without a lock.

The advantage of the fourth pillar is access: you can always reach it. The downside is that you get no deduction and the capital falls into box 3. See wealth management.