As of: January 31, 2024, 2:36 p.m
By: Lars-Eric Nievelstein
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For some time now, employees have had the opportunity to receive an early pension.
And that with full social security.
We take a look at the “dual-earner model.”
Berlin – Until January 1, 2023, unlimited additional income was only permitted for regular old-age pensioners.
Anyone who received an early retirement pension had to expect a reduction in their pension if they combined their job and pension.
It was only during the Corona years that a few special regulations emerged here.
And for a little over a year now, it has been true that early retirees can earn any amount of additional money without having their pension reduced.
If you continue your job or take up a new job, you do not have to inform the pension insurance company.
Regular retirement pension entry |
67 years |
|---|---|
Waiver of the 99.99 percent partial pension (based on a pension of 2,000 euros) |
20 cents |
Federal subsidies for pension insurance per year |
110 billion euros |
The dual-earner model at a glance
This change opened the door to the so-called “dual-earner model.”
Social judge Stephan Rittweger told
Spiegel
a practice in which employees receive a partial pension in addition to their regular salary.
This is how it works: An employee who has already worked for 45 years, i.e. who has completed his working years until retirement, could retire at 65.
So two years before he reaches the standard retirement age.
Receive a pension and a salary at the same time – the “dual-earner model” © IMAGO / Westend61
Now he can receive both: wages and a pension from the German pension insurance.
To do this, he must apply for a 99.99 percent partial pension from the German pension insurance company.
If he receives 2,000 euros gross in his regular pension, he would have to forego around 20 cents per month in this model.
Otherwise he would already be in full retirement.
The special thing about the model: Those who use it continue to have full social insurance.
In addition, entitlement to social benefits such as sick pay and short-time work benefits remains.
Fewer waiting years mean more discounts
According to the expert, this method is particularly worthwhile for people who have already accumulated a lot of their waiting time.
For those who have waited 45 years, the whole thing should work “without any problems”.
The model can also be used for employees with a waiting period of 35 years, although discounts can be expected the earlier this “partial retirement” takes place.
However, it is important to take a look at your own employment contract.
Some contracts contain clauses that provide for termination of employment once the employee receives a pension.
In this case, taking partial retirement would not work if the goal is to earn money while working.
In such cases, the expert recommends having a clarifying discussion with the employer.
Wages, pensions and company pensions
And then there is the company pension, from which employees can earn additional funds.
As soon as this is combined with the normal wage and the partial pension, it is even referred to as the “triple earner model.” In order to receive this, employees must initially receive a full pension for a month, then reduce it to a partial pension in order to benefit from several of these models at the same time.
However, this depends on a rather specific set based on different requirements.
There is also the risk of falling ill during the month of full pension, which would eliminate the right to sick pay.
Nevertheless, this gives employers the opportunity to retain experienced specialists without additional financial outlay.
As soon as they realized this, “clauses in the contract would also be changed according to their interests”.
Skilled workers hold on at all costs
In the end, the question arises: Why is the legislature allowing this obvious “drain” of the pension fund when the pension pots are already strained - and will remain so in the medium term?
According to
Spiegel
, the legislature simply classified the retention mechanism for skilled workers on the labor market as more important.
More workers who pay into the statutory pension insurance secure the model in the long term.
Experts warn of the end of the pension system
The current trend is that Germans tend to retire earlier.
Figures from the Federal Institute for Population Research (BiB) show that many people leave working life at the age of 63 or 64.
Around a quarter of all new pensioners will not have reached the normal retirement age in 2021.
The increase in the employment rate among those over 60 has come to a standstill.
“We can’t afford the pension system for much longer,” said the head of the economists, Monika Schnitzer, to the Münchner Merkur.
The federal government already has to “supplement” the pension insurance with 110 billion euros annually.
“If we continue like this, in 25 years every second euro from the federal budget will go into the pension fund as a subsidy.” This problem cannot be solved with more tax money alone.
Stock pensions are currently being discussed in politics as a possible solution.