How much will your pension be? This number in the pension information tells you

The pension information contains many confusing numbers.

We will show you which of these will tell you the amount of your future pension.

Berlin - Every person insured with the German Pension Insurance (DRV) automatically receives annually the so-called pension information from the age of 27.

Another requirement is that you have paid into the pension fund for at least five years, otherwise you will not be entitled to a pension.

The first look at the pension information may be confusing.

Nevertheless, you should study it in detail, as it offers valuable insights into the financial situation in old age.

Understanding retirement information: Finding out the retirement age

First of all, the basics.

At the top left you will find your insurance number, which you will need for all communications with the DRV.

At the top right is the regional office responsible for you, including contact details.

The first section shows the period in which you have paid into the pension fund so far and when you can start receiving your regular old-age pension.

Special regulations such as early retirement * or partial retirement are not taken into account.

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Thanks to the pension information, you can assess whether the pension is sufficient or whether you have to make additional provisions

© German pension insurance

It gets interesting in the following sections.

Here you can find out the amount of your possible pension payments under various conditions.

Understand pension information: amount of disability pension

On the one hand, there is the pension * for full disability.

This is the amount of the monthly payment if you can no longer work from today for health reasons.

To do this, however, you must be 100 percent unable to work.

This does not include occupational disability.

The disability pension is not only calculated from the time in which you paid into the pension fund.

When you retire in 2021, the calculation is as if you had continued to work until you were 65 years old and ten months old and paid contributions accordingly.

For later retirement, this so-called credit period is gradually increased to the age of 67

Understanding pension information: Pension entitlement achieved so far

This is followed by the amount of the pension entitlement that you have acquired so far, without any further payments.

This is the case, for example, if you go abroad and no longer pay into the pension fund.

Of course, the money is only available after reaching the regular retirement age *.

Understand pension information: Amount of the standard old-age pension without adjustments

Only now does the amount of the actual, probable regular old-age pension follow.

Payment will be made if you have earned the same amount by the time you reach the standard retirement age as the average for the past five years.

Possible reductions due to payment defaults and increases due to salary increases are not taken into account.

This is the gross pension.

Because health and long-term care insurance and, if applicable, taxes are to be paid on it.

Understanding pension information: taking into account the pension adjustment

As the DRV admits in the pension information itself, the sum mentioned is only an estimate, as the development cannot be foreseen. That is why a pension adjustment is also indicated. Since the amount of the salary is linked to the average wage, the amount of the pension has increased sometimes more, sometimes less in recent years. In the pension information you can find out how high your earnings would be if the pension were to be increased by one or two percent annually.

It is important to note that this does not include the loss of purchasing power.

With inflation of 2.0 percent per year, 100 euros will only be worth around 82 euros in ten years.

The DRV advises that this loss of purchasing power should also be taken into account in private provision.

This is recommended because pensions will rise less in future than wages.