Japan to reform iDeCo pension limits and age eligibility

Japan is set to implement significant reforms to the iDeCo (individual-type defined contribution pension) system, effective December 1, 2026. The changes aim to support asset formation for an aging population by raising contribution limits and extending the eligible age for participation.

Under the new rules, the monthly contribution limit for Category 2 participants (employees without corporate pensions) will increase significantly from 23,000 yen to 62,000 yen. Category 1 participants (self-employed) will see an increase from 68,000 yen to 75,000 yen. Notably, Category 3 participants (dependent spouses) will see no change, remaining at 23,000 yen.

The reform also introduces a new category for individuals aged 60 to 70 who wish to continue asset formation, provided they have not yet started receiving old-age basic pensions or iDeCo benefits. This extension is designed to align with increasing trends of elderly employment and the 'WWP' approach, which combines working longer with private and public pension management.