As of: March 27, 2024, 6:22 a.m
By: Juliane Reyle
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What pension rights do I have in retirement?
What deductions should be expected – is the money in the account enough?
An overview.
The pension is an important part of retirement planning in Germany.
But various factors can influence the amount of the pension and reduce it.
The bottom line is: less money in the account.
echo24.de
explains what role salary points, insurance, demographics and more have on pension levels and payouts.
Pensioners or employees can even take tactical action against some cuts in advance.
Deductions from the pension: This results in less money in the account
Some pension deductions are deducted directly by the state or insurance company, others are individual and can vary.
Known
deductions from the pension are
:
Health insurance contribution
Nursing care insurance contribution
Additional contribution from the health insurance company depending on the level of income
Tax on pensions above the basic allowance
Insurance contributions for health insurance and nursing care insurance must be deducted from the pension.
Depending on the amount of the pension, not only taxes have to be paid, but also an additional contribution to the health insurance company.
Because the pension is considered income.
Other factors that influence the amount of pension and money in retirement
The “Deutsche Rentenversicherung” expects the pension fund to be less burdened by the aging of society than previously assumed, as the “Tagesschau” reports.
Nevertheless, demographics play a role in the amount of the pension.
If there are no taxpayers and young people who pay into the pension fund, paying out a high pension becomes more difficult.
How the pension will develop remains to be seen.
But for now there will be a pension increase from July 2024.
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The amount of the pension also depends on the earnings points earned during working life.
Those who earn well also receive more earning points.
The number of earnings points is related to the average annual income in Germany, as the “Deutsche Rentenversicherung” explains.
The number of pay points and thus also the pension is therefore already controlled based on working hours.
Further reductions in pensions: This means that less money comes into the account in retirement
One of the best-known cuts is the pension reduction for early retirement.
The retirement age depends on various factors – such as the type of pension, the contribution periods or the year of birth, writes “CosmosDirekt”.
Anyone who retires before the official retirement age must expect deductions.
How high these are and how much less money people have to live with in retirement remains individual.
What is certain, however, is that for many people the 45 years of contributions are difficult to achieve.
However, the legislature requires 45 years of employment in order to pay out the full pension, as “Weltsparen” writes.
By the way, there is also a difference in the payment of pensions depending on the year of birth: these age groups receive the most money.
Tips to avoid pension deductions
are:
Longer premium payments
Pay attention to high income
Private pension provision
The longer you pay into the pension insurance, the higher the pension will be and the higher the income, the more earnings points will accumulate and thus lead to a higher pension, writes the “Deutsche Rentenversicherung”.
Private pension provision can also provide more money in retirement.
It is important to do your research in advance.
If you start saving and investing money in good time, you can significantly improve your pension.
However, it is also important to pay attention to small details, for example a wedding affects money in retirement: Less money because of marriage?
This is what couples should know before getting married.