Retirement age in Germany for women and men

Attitude towards pensioners in Germany

UN data claim that the standard of living of pensioners in Germany is very high and is second in quality only to two countries - Norway and Sweden. Elderly people travel a lot, play sports, and do charity work.

In German society, it is customary that the state takes care of pensioners, and not their children or grandchildren. The maximum that is done in practice for elderly parents is to find a good nursing home, the number of which reaches 11 thousand institutions throughout the country.

At what age is a pension in Germany?

When a citizen of respectable age reaches old age and receives assistance from the state depends on the year of his birth. Periodically, the German government discusses raising the retirement age. There are plans to increase it first to 68, and after 2069 to 70 years.

Old age pension age in Germany

Residents of Germany have the right to retire two years earlier if they have a disability. The same opportunity is available to people whose working experience is 45 years or more, and they have made appropriate tax deductions. But there are practically no such people in Germany.

Plus 5 years for men, plus 8 for women

The Russian government approved a bill on gradually increasing the retirement age on June 14, 2021. According to it, the retirement age for men is planned to be increased from 60 to 65 years by 2028, for women - from 55 to 63 years by 2034.

Types of pensions in Germany

As in any other country, there are several types of pensions in Germany.

They are as follows:

1. A simple pension, which is assigned upon reaching retirement age.
2. The pension is for citizens who have reached the age of 63 to 65 years, but the most important condition is their year of birth, as well as their work experience, which must be at least 45 years.
3. A pension that has increased payments due to the fact that a person has an illness or injury that prevents him from working.
4. For females who have reached the age of 60 and were born before 1952.
5. For those persons who work in the depths of the mine and who are over 60 years old.
6. For those citizens who are widowed, orphaned, or whose relative has died.

State

The country offers several specific types of pensions in Germany of a state nature, which are paid exclusively by the state.

These are the following types:

1. By age - in case of reaching retirement age, namely from 65 to 67 years on average.
2. For the loss of a breadwinner - in the event of the death or complete absence of the family breadwinner, who was the only source of income for the family.
3. For disability – if you have a congenital or acquired disability.

Private pensions

There are dozens of different pension funds in Germany. They are popular among those citizens who have a high income or those who are not officially employed. By the way, in Germany there are very few people who do not work officially.

Citizens enter into an agreement with private pension funds and make contributions every month, the amount of which is determined by the citizens themselves. This pension system in Germany operates on a cumulative basis; Germans receive good additional payments towards their retirement.

All transfers go to a bank account. Essentially, this money can be used any time the account holder wants. But citizens of this state prefer to use their savings in retirement.

How much do older people earn?

The size of the pension depends on length of service and salary. In 2021, the average state pension for men was about 1,145 euros, and for women - about 775 euros. And this is not inequality, but the influence of decrees and other reductions in working days.

For comparison, the average salary in this country is more than 2,400 euros. But from this amount you need to deduct health insurance, income tax and rent if you do not own the home.

The concept of “minimum pension” does not exist as such, so they focus on the figure of 512 euros. If a person’s total income is no more than 865 euros per month, then he can apply for social benefits. It covers the cost of rent and heating, clothing, and medical services. But many are ashamed to ask, so the real number of those who literally make ends meet is unknown.

Pension amount

The state does not hide data on the amounts of payments - they are freely available on the portals of Deutsche Rentenversicherung - the state pension insurance system.

The amount of payments depends on 6 factors:

1. The amount of insurance contributions for pensions during the period of employment.
2. Length of work experience.
3. Age.
4. Political and economic situation in Germany.
5. The territory in which the citizen lives - Western or Eastern.
6. Type of pension contributions.

The average pension figures vary depending on the land of residence - the western or eastern location of the country. The data is also gender specific.

Interestingly, widowed citizens have the right to receive a double pension.

This difference is explained by working conditions: in the GDR, women usually work on an equal basis with men, which helps them have a longer working period.

Minimum pension

The minimum pension in Germany ranges from € 324 to 404 or 23.5 - 29.3 thousand rubles. This amount is established for persons who, in case of disability or reaching old age, receive less than € 789 per month.

The amount of payments, the so-called “Grundsicherung” benefit, is established depending on the situation that has arisen in the life of a citizen. In addition to the above amount, the pensioner is paid for utilities, housing, routine repairs and other similar needs.

In order to receive benefits, you need to fill out an application in the prescribed form, which is submitted to the “Sozialamt” - the Office for Providing Social Benefits to the Population.

Average pension

The average size of the actually paid pension in Germany can be found out from the official data of the state pension insurance system (Deutsche Rentenversicherung). Data on the average pension in Germany are published separately for the states of western and eastern Germany (West Germany and the former GDR).

As of January 1, 2021, the average amount of paid pension (after deducting social charges), net pension per month in West Germany is for men 1018.00 euros (or 75'253.92 rubles), for women 630.00 euros (or 46'571.68 rubles).

It is noticeable that men's pensions are significantly higher than women's pensions in Germany. The average pension for men and women together is 770 euros per month (or 56,920.94 rubles). Including the states of Eastern Germany, this amount increases slightly. In the following table you can find out the average amounts of pensions paid.

The level of pensions in East Germany, the former state of the German Democratic Republic, is slightly higher than in the states of the Federal Republic of Germany. On average, for men the difference is 50 euros and amounts to 1068 euros; for women the difference is 225 euros and amounts to 855 euros. How many pensioners are there in West and East Germany?

The average net pension for all types of pensions in Germany for 2021 is 770 euros

Average real pension and standard calculated pension

Various sources of information often provide data that the standard calculated pension in Germany is much higher than the data we provide in Table 2 and amounts to at least 2 times more.

The fact is that the standard calculated pension (Standardrente, Eckrente) is the amount that would theoretically be received by a person who earns the average salary in Germany and will pay pension contributions for 45 years without interruption.

In reality, this situation rarely occurs. In addition, the average standard pension, which is often written about in the media, is usually a gross pension, with which you will still need to pay social charges and does not take into account other types of pensions, but only pensions in connection with the onset of retirement age.

The standard estimated gross pension in Germany is 1,441.35 euros. The standard estimated net pension in Germany for 2021 is €1,264.

The work experience of men in Germany is at the level of 40 years, and for women even 30 years, this is due to the fact that Germans study a lot and start working late, and women take breaks in connection with the birth of a child and caring for him. Other factors also play a role.

In August 2021, Germany decided to keep the standard calculated pension at 48% of the average salary in Germany until 2025, thus preventing the pension level from falling in relation to the average salary.

Pensions for civil servants and miners

There are a number of people in Germany who receive very high pensions. These include:

• miners, as well as miners;
• clergy;
• state employees (it should be noted here that government employees include not only officials, but teachers, doctors, etc.).

Miners can count on a pension of 1,200 euros as early as 60 years of age, given that they have at least 25 years of work experience. For employees in government agencies, the average pension is more than 2 thousand euros. Church workers also have high pensions, because... There is a separate church pension fund that makes payments.

Pensions for widows (widowers)

The state helps its citizens who find themselves in difficult situations. In cases where several conditions have been met, citizens can apply for a double pension if they have lost their spouse.

These conditions consist of:

• contributions to the Pension Fund have been made for at least 5 years;
• spouse died due to an accident at work;
• the pension had already been paid to the deceased.

During the first three months, the amount of payments will be equal to the deceased’s pension. Then they will be reduced to 50 or 20 percent.

In cases where the widower remarries, the “widow's pension” will not be paid.

Germans will have to work until they are 70: when can our neighbors retire?

From 2025, the retirement age in Germany will be raised to 70 years. This means that every German citizen born after 1980 will have to work even longer.

The need to raise the retirement age is confirmed by an analysis by the Institute of German Economics (Institut der Deutschen Wirtschaft, IW). IW researchers have warned the government that raising the pension age to 68, as policymakers want, will not be enough to keep the pension contribution rate at 22% permanently.

What is the situation with pensions in neighboring European countries?

Austria : Austrians can retire at 65, women even at 60. In Austria, pensioners who retire in 2021 receive an average of €1,529.53 per month. By comparison, a German pensioner receives on average just €918. In addition, pensioners in Austria receive holiday and Christmas supplements and thus receive a pension 14 times a year (Germany: 12 times).

However, Austrians pay more. The pension contribution rate is 22.8% of income subject to social insurance. The employer pays 12.55% and the employee 10.25%. By comparison, in Germany the contribution rate is 18.6%, with both parties contributing equal half.

Greece : On average, Greeks are required to work a minimum of 33.2 years before retiring. To receive a full pension, workers in Greece need to pay pension contributions for a full 40 years to retire from age 62. The average worker receives half of their final salary in pensions (51.1%), almost the same as in Germany.

Netherlands : The retirement age in the Netherlands will be raised to 67 in 2024. Every worker who has worked for 50 years receives a full standard pension, which is the same for everyone, regardless of earnings (approximately €1,300 per month).

France : Men and women legally retire at age 60. The average retiree receives a pension equal to 73.6% of their last salary.

Italy : Italians are entitled to a pension after 35 years of work. Women retire at 60, and men at 65. The average retiree receives almost 92% of their final net salary as a pension. This is the highest figure in Europe, but Italians have to pay more: 33% of their salary. Two-thirds of the contribution is paid by the employee, and one-third by the employer.

Spain, Portugal and Ireland : The legal retirement age in these countries is 65 years.

Denmark : Danes will soon have the longest working lives. Here the retirement age will increase from 65 to 69 years.

Switzerland : The legal retirement age is currently 64 for women and 65 for men, with retirement possible up to five years earlier or later.

Czech Republic : This applies a gradual adjustment to the retirement age, raising it to 65 years. Those born in 1971 retire at the age of 65, and those born in 1960 retire at the age of 64 years and two months.

Sweden : You can receive a state pension from age 62, but the minimum retirement age will be gradually raised to 67 by 2026.

Finland : The retirement age will gradually rise by three months each year until age 65 in 2027. The retirement age will then be linked to life expectancy.

Poland : The retirement age is 60 for women and 65 for men.

Pension formula

Mathematically, the pension formula looks like this:

{\displaystyle {\text{Rente}}={\text{EP}}\cdot {\text{ZF}}\cdot {\text{RAF}}\cdot {\text{aRW}}}

where:
Rente
- monthly pension expressed in euros (German Rente)
EP
- pension points (German Entgeltpunkte)
ZF
- output coefficient (German Zugangsfaktor)
RAF
- coefficient determining the type of pension (German Rentenartfaktor)
aRW
- current value of the pension points (German: aktueller Rentenwert)

Pension points EP

EP pension points reflect the amount of pension contributions of the insured for all years of his working activity. According to § 63 of the sixth book of the German Social Code (SGB VI), the amount of pension contributions (contributions to the pension fund) within one year from a salary equal to the average annual salary of all insured persons in the pension fund gives 1 pension point.

Thus, pension points:

• reflect the dependence of the pension on income: The pension point earned during one calendar year reflects the ratio of the individual income of the insured person to the average income of the insured persons of the same calendar year.
• allow you to compare pension contributions for different years: For a person applying for a pension, the relative amount of pension contributions paid is important, and not the year in which these contributions were paid.
• allow you to create a dynamic income-related pension: Pension points together with the current value of the aRW pension point form the basis of a dynamic, income-related pension system.

Data table for calculating pension points for old age pension:

Output factor ZF

This coefficient was included in the pension formula in 1992. Upon reaching retirement age, the insured person receives an old-age pension. To take into account the time of retirement, the output coefficient ZF is used.

Coefficient ZF = 1 if retirement occurs at an age in accordance with German pension legislation. With an earlier retirement, the ZF coefficient will be less than 1, and with a later retirement, it will be greater than 1.

In case of early retirement, the ZF exit coefficient is reduced by 0.003 for each calendar month of early retirement. This corresponds to a reduction in pension of 0.3% for each month. This reduction in pension applies to the entire period of pension payment, and in the future does not depend on the age of the recipient.

If you retire later, the ZF retirement factor increases by 0.005 for each calendar month following the achievement of the statutory retirement age. This corresponds to an increase in pension of 0.5% for each month.

Starting from January 1, 2001, this ZF coefficient was also introduced for the calculation of other types of pensions. The calculation procedure and the value of the ZF coefficient for them are determined by the relevant rules of German pension legislation.

Output factor ZF for old age pension:

RAF coefficient

The RAF coefficient was introduced into the pension formula in 1992 and determines the type of pension. Thanks to this coefficient, it became possible to use the pension formula for calculating other types of pensions.

RAF pension type factor:

Cost of aRW pension point

The current value of the pension point is calculated annually and published on July 1. Its value depends on the size of salaries, on the level of insurance contributions to the pension fund and on the demographic situation in the country. A separate formula is used to calculate the current value of a pension point.

Examples of calculations

Example 1

The worker, born in 1946, worked in West Germany for 45 years, regularly contributing his insurance contributions to the pension fund. Moreover, his salary always corresponded to the average salary of all those insured in the pension fund, which gives him 1 pension point for each year.

At the age of 65, he will retire in autumn 2021 as an old-age pension (RAF = 1) in accordance with German pension law (ZF = 1). At the time of retirement (autumn 2021), the value of the pension point was aRW = 27.47 Euro. From July 1, 2019, the value of a pension point has been increased to aRW = 28.61 Euro.

Calculation of monthly pension for the period from autumn 2021: Rente = 45 x 1 x 1 x 27.47 = 1236.15 Euro/month.

Calculation of monthly pension for the period from July 1, 2021: Rente = 45 x 1 x 1 x 28.61 = 1287.45 Euro/month.

Example 2

The worker, born in 1946, worked in West Germany for 45 years, regularly contributing his insurance contributions to the pension fund. Moreover, his salary was 2/3 of the average salary of all those insured in the pension fund. At the age of 65, he will retire in autumn 2021 as an old-age pension (RAF = 1) in accordance with German pension law (ZF = 1).

Calculation of monthly pension for the period from autumn 2021: Rente = 45 x 2/3 x 1 x 27.47 = 824.10 Euro/month.

Calculation of monthly pension for the period from July 1, 2021: Rente = 45 x 2/3 x 1 x 28.61 = 858.30 Euro/month.

How to get a pension

Once approved, payments will be deposited directly into your bank account. The recipient himself determines the method of withdrawing money that is convenient for him - through a card account or at a banking institution.

Documentation

In Germany there is no concept of automatic retirement; you must submit documents to receive assistance:

• an application written by hand or on a special form (in the latter case the review process will be accelerated);
• tax identification number; bank account details; passport or foreign passport;
• health insurance card;
• children's birth certificate, unemployment certificate and certificate (in some cases).

In order to receive Grundsicherung in the future, a person must contact the Sozialamt. This is the German Social Security Administration, where they will provide him with a package of necessary documents.

But, in addition to this payment, the state will additionally provide financial assistance to pay for utilities, treatment, medicines and other vital needs.

Contributions to pension funds

The amount of deductions is determined based on the salary of a German citizen. The higher it is, the correspondingly more deductions. All documentary issues related to pension contributions are handled by the employer.

In cases where income falls below 450 euros, pension contributions are equal to 15% of earnings.

There are also people who are provided with payments before retirement age:

• Those with an official work experience of 45 years.
• Women with a birth year before 1952 who fulfilled certain conditions specified by the state can retire at age 60.
• Citizens who have lost their legal capacity and disabled people.

Reference! The usual contribution to the Pension Fund is 18.7% of the salary. Half of this amount is paid by the employer, and half by the citizen himself.

Trade unions are against the increase

The All-Russian Association of Trade Unions launched a petition addressed to President Putin demanding not to raise the retirement age. In the first two weeks alone, more than 2.5 million Russians signed it.

Life for yourself

Some believe that it is the “social paradise” that is the cause of the famous German egoism. It is not customary for families here to help each other. When children reach adulthood, they leave home, “carrying away in their knapsack” only their parent’s blessing. It is believed that everything you need can be earned or received from the state.

Germans love to travel and babysit their grandchildren

Children pay their parents in the same coin. Finding a decent nursing home for a parent is the maximum that a caring German child can do. Fortunately, there is no shortage of such establishments in Germany. The most powerful system of social structure for very elderly people is built with German pedantry and accuracy.

Almost eleven thousand nursing homes have all the conditions for those who have passed the 85-year mark.

There is a whole industry in the country for training specialists working with older people. “Young” old age from 65 to 75 years is spent actively and for one’s own pleasure. The German does whatever he wants. He can study English, dance the rumba, play the saxophone or play with his grandson in the sandbox.

Older people find new hobbies and achieve excellent results

Germans love to travel. They are unpretentious and do not disdain budget resorts in Turkey, Greece or Latvia. The Germans can be recognized by their restraint, equanimity, silence and, of course, economy.