Cabo Verde Pension Guide 2026

Overview — Cabo Verde's Pension System

Cabo Verde's pension system is a defined-benefit social insurance scheme administered by INPS for private-sector employees. The system is funded by mandatory contributions from employees and employers, calculated as a percentage of gross salary up to a capped ceiling. In addition to retirement pensions, the system provides disability pensions, survivor's pensions, and lump-sum payments. The INPS also administers health insurance coverage for contributors. For public-sector employees, separate pension arrangements apply under the Caixa de Aposentações do Estado. The pension system is governed by the Social Security Code and INPS regulations.

Retirement Age — 65

The standard retirement age in Cabo Verde is 65 for private-sector employees. Early retirement is possible from age 60 with reduced benefits (the pension is actuarially reduced by approximately 4-5% per year below age 65). Deferred retirement beyond age 65 is possible with employer agreement, and the pension is increased by approximately 4% per year of deferral up to age 70. To qualify for a retirement pension, the employee must have contributed for at least 15 years (180 months) of contributions. Employees who have not completed the minimum contribution period receive a lump-sum refund of their contributions plus accrued interest. The retirement age has been gradually increasing in line with demographic trends and pension sustainability considerations.

INPS Pension Calculation

The INPS retirement pension is calculated based on the following formula:

• Base salary — average of the best 10 years of salary (subject to the contribution ceiling of CVE 250,000/month)
• Accrual rate — 2% per year of contribution (approximately)
• Maximum pension — 80% of the reference salary (after 40 years of contributions)

Due to the CVE 250,000 monthly contribution ceiling, the maximum pensionable salary is capped. This means even a high earner will have a pension calculated on a maximum monthly salary of CVE 250,000. For example, 25 years of contributions at the maximum ceiling would yield a monthly pension of approximately CVE 125,000. Supplementary retirement savings are recommended for adequate retirement income, particularly for professionals and expatriates.

Disability & Survivor Benefits

INPS provides benefits beyond retirement pensions:

• Disability pension — available to contributors who become permanently disabled before retirement age, calculated based on contribution history
• Survivor's pension — paid to the spouse and children of a deceased contributor, typically 60% of the pension the deceased was receiving or entitled to
• Death grant — lump-sum payment to cover funeral expenses
• Occupational injury benefits — compensation for work-related accidents and diseases

Supplementary Retirement Savings

Given the capped INPS pension, supplementary retirement savings are strongly recommended. Options include:

• Private pension plans — offered by banks and insurance companies (planos de poupança-reforma)
• Voluntary INPS contributions — self-employed individuals can make additional voluntary contributions to increase benefits
• Real estate investment — rental properties provide retirement income in the tourism-driven economy
• Investment in financial assets — government bonds, bank deposits, and investment funds

The government has been working on pension reform to expand coverage and improve benefits, particularly for informal-sector workers who make up a significant portion of the workforce.

FAQs

Can I withdraw my INPS contributions if I leave Cabo Verde permanently?

Yes, if you emigrate permanently from Cabo Verde, you may apply for a refund of your INPS contributions plus accrued interest. Documentary evidence of emigration is required. Cabo Verde has social security agreements with Portugal and other CPLP countries that may allow contribution aggregation.

How much will my INPS pension be at retirement?

Your INPS pension depends on your best 10 years' salary (capped at CVE 250,000/month) and your years of contribution. With the cap, expect a modest but meaningful pension. Supplementary savings are recommended.

Are self-employed workers covered by the pension system?

Self-employed workers are not required to contribute to INPS but may join voluntarily. They are strongly encouraged to contribute to the voluntary scheme or private pension plans to ensure retirement income.

Disclaimer

This guide provides general information about Cabo Verdean pensions for the 2026 tax year. Pension laws, contribution rates, and benefit calculations may change. Always consult with a qualified Cabo Verdean pension advisor or INPS for advice specific to your situation. InvestmentKit does not provide pension advice.