As of: February 5, 2024, 8:00 p.m
By: Karolin Schaefer
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The transition from working life to retirement can be structured flexibly.
With one trick you can collect both pension and salary - without deductions.
Frankfurt – Hardly any other topic is discussed as much as pensions in Germany.
But having an overview of the pension system is not that easy.
With a few tips, you can start your retirement without any problems.
Retire early?
This is how it works without any deductions
The key word is “retire at 63”.
This means that employees can retire before reaching regular retirement age - and without any deductions.
It should be noted that this only applies to people who have been insured for a particularly long time, emphasizes the German Pension Insurance.
If you have already worked for 45 years and were born before 1953, you can retire without deductions at the age of 63.
For those who were born later, the minimum retirement age that must be reached increases gradually from 63 to 65 years.
How you can collect salary and pension with the Flexirente
But you don't have to stop working.
With the so-called flexi pension, the transition from working life to retirement can be made flexibly.
Last year, the additional earnings limit for early retirement was abolished.
This means that pensioners can earn an unlimited amount of money and thus increase their monthly pension.
At the same time, you can increase your pensions by paying amounts into the pension insurance.
This is what the state rewards: For every month that you continue to work after your retirement, you get an additional 0.5 percentage points.
After one year, the old-age pension increases by six percent, according to the German Pension Insurance.
Whether this is worthwhile from a tax perspective always has to be decided individually.
Applying for a partial pension can be worthwhile: “Any share can be chosen”
But there is another trick.
You can also apply for only part of the pension.
“The portion of the partial pension can be chosen arbitrarily for old-age pensions, as long as it is at least 10 percent or a maximum of 99.99 percent of the full pension,” informed the German Pension Insurance.
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With a trick you can collect pension and salary.
© Michael Gstettenbauer/imago
This means that partial pensioners are entitled to sickness benefit, unemployment benefit and short-time work benefit, emphasized the Institute for the Training of Works Councils (ifb).
If the full pension is received, this entitlement no longer applies.
So if you take a part-time pension at 63 at 99.99 percent, you will lose a few cents a month, but in the event of a long-term illness you will still be entitled to sick pay after six weeks.
Collecting salary and pension: Is it worth it for everyone?
However, this model is not worthwhile for everyone.
If you retire early with reductions - for example after 35 years of contributions - the loss may no longer be able to be compensated.
0.3 percent is deducted for each month that the pension begins earlier - a maximum of 14.4 percent.
Even after reaching retirement age, the deduction remains.
When retirement is most worthwhile for whom must always be decided individually.
Those interested can seek advice from the pension insurance company.
Meanwhile, all employees will receive important pension mail in February.