Retirement and retirement – these are the differences
Created: 05/01/2023, 07:00
By: Anna Heyers
Pensioners often live much more relaxed lives than pensioners.
This is also due to the fact that they are often better financially secure through their pension.
Some professional groups in Germany are not paid with a salary, but via salary.
This difference is also noticeable in retirement, because the so-called pension takes effect instead of the statutory pension.
As a rule, this is a good deal above the pension payments.
But what exactly is the difference between a pension and an annuity?
Calculation of pension and annuity
Put simply, the pension is calculated based on the last salary (max. 71.75 percent of the gross salary).
The pension, on the other hand, adds up all income from the years of work.
Pension – who gets the pension?
Civil servants, judges, professional soldiers, pastors and other public service employees do not retire.
You retire.
Those born before 1947 are allowed to retire at 65, after which the normal retirement age increases gradually until 1963.
From the year of birth 1964 the limit is 67 years.
Similar to the pension, you can also retire earlier from the age of 63 in the case of a pension – also known as an old-age pension.
To do this, you submit the corresponding application and have to accept deductions.
In addition, one of the following conditions must be met:
An incident during your service left you unable to work.
This can be, for example, an accident for which you are not (grossly) to blame.
The period of service was at least five years,
Even police officers in public service do not receive a pension when they retire, but a pension.
(Iconic image) © imagebroker/Imago
Dismissed from public service – what now?
Anyone who has been given notice will be reinsured in the statutory pension insurance.
The dismissed person does not receive a pension.
However, the back payments are only half of the employer.
An exception here is the federal government and some states: If you were released at your own request (application), old-age benefit will be paid.
However, retirees have to accept a discount of 15 percent.
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Annuity and pension: what is the difference?
Besides the name, the biggest difference is the size of the payouts.
An example from Bavaria, for a teacher who still has to work for 35 years:
profession | Salary/tariff group | payout/month |
|---|---|---|
teacher | A13 (salary) | approx. 3,139 euros (board) |
teacher | TV-L E13 (tariff group) | approx. 1,496 euros (statutory pension) |
However, a direct comparison is difficult.
The pension is also higher because it already covers two of the three pillars of German old-age security.
In addition to the standard security (first pillar), which also covers the statutory pension, this would also be the second pillar: additional security.
There is no additional company pension scheme.
Employees and civil servants are responsible for the third pillar, private provision.
Additional expenses for retirees
Pensioners must also take out private long-term care and health insurance from their earnings.
Voluntary statutory insurance is also possible.
If the retirees were less than 90 percent covered by statutory health insurance during the second half of their working lives.
Contributions are then based on the total monthly income.
