The trend towards early retirement is continuing. This is shown by new data. Although many early retirees have to forego part of their retirement benefits. But the losses can be offset.
According to calculations by the Federal Institute for Population Research, more and more people in Germany are retiring earlier. According to this, many leave the labor market at the age of 63 or 64 – well before the standard retirement age.
Although the early retirees forego a significant portion of their old-age pension, the pension fund loses billions in contributions. At the same time, the German economy is suffering from a labor shortage.
This is one of the reasons why politicians are reacting with concern to the development. Chancellor Olaf Scholz wants fewer employees to take early retirement. “It is important to increase the proportion of those who can really work until retirement age,” said the SPD politician to the newspapers of the Funke media group and the French newspaper “Ouest-France” on Sunday. This is currently difficult for many employees.
Scholz also sees “potential for an increase in the proportion of women in the labor market”. In order for this to work, the state must “expand all-day offers in crèches, day-care centers and schools,” says Scholz.
Even if the Chancellor wants to break the trend towards early retirement, many employees choose the option of ending their working lives earlier.
As mentioned above, those who retire a year earlier with 35 years of contributions forego 3.6 percent of their actual pension entitlements.
Calculation example: Employee A. could take regular old-age pension at the age of 64. According to the DRV data, he should then receive a gross pension of 1,500 euros per month. A. is retiring at the age of 63 and forgoing 3.6 percent of his pension.
A. permanently waives this amount. Even if he reaches his actual retirement age at 64, his pension will remain reduced by this amount. If A. receives a pension for 20 years, he waives 12,960 euros – without future pension increases. That increases the losses even more.
If you want to financially compensate for later pension losses, you can do this with extra contributions to the pension fund.
The amount of the later individual pension depends on how many earnings points (also called “pension points”) an employee has. Each pension point brings current per month
In order to compensate for the losses in whole or in part, employees can buy the so-called remuneration points with extra contributions. A pension point in the west currently costs 7235.59 euros. One pension point brings the retiree a pension of EUR 36.02 per month. With a 20-year reference period, this is 8644.80 euros with the current values. This amount will increase as a result of future pension increases.
An important reference value for the price of a pension point is the so-called average salary of all those subject to pension insurance. That is 38,901 euros in 2022.
In 2023, the average wage will increase. The provisional value was recently set at 43,142 euros. If it stays that way, the price for a pension point (West) will climb to 8024 euros in 2023. That is 10.9 percent more than currently. So if you want to compensate for possible early retirement losses, you should do so in 2022. He saves a lot of money.
The tax savings also speak in favor of the purchase of pension points: increasing extra payments into the statutory pension brings high tax advantages. Thanks to the tax gifts, the state often takes on around 30 percent of the voluntary payments. If you spread your payments over five years, you can take full advantage of the tax benefits.
The FOCUS Online Guide answers all important questions about pensions on 135 pages. Plus 65 pages of forms.
