Thursday, 05.02.15, written by Anja Schlicht
The pension information is intended to keep consumers up to date on their acquired pension rights. However, what the numbers are really worth, is difficult to estimate, especially for younger generations. But not only for them, but also for older generations, it is important to interpret the amounts correctly, so as to be able to follow-up if necessary.
Understanding pension information properly is not easy
Only recently, a survey commissioned by the financial services provider MLP found that 40 percent of Germans have no concrete idea about the amount of their statutory pension , another 30 percent have only a rough idea. Not even one in three respondents is therefore aware of the amount of their old-age pension at the beginning of retirement. The German pension insurance sends an annual letter to its insured to inform them about their pension rights. But the result of the current survey indicates: Not every consumer knows how to estimate the information.
Understand pension information correctly
As for their statutory pension rights , consumers learn from the annual pension information . In doing so, writing can help to take private retirement provision in old age. But that is only possible if the citizens can correctly classify the numbers. In an interview with finanzen.de, Marina Herbrich, President of the Federal Association of Pension Consultants, explains that the idea of pension information – shaking up consumers – is good . However, this only succeeds if pension insureds make aware that the stated pension amount at the beginning of retirement is an extrapolation . “If the insurance history changes, so does this extrapolation.”
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What is the pension really worth?
Annually, Deutsche Rentenversicherung ships around 31 million pension information. Every pensioner automatically receives the letter if he or she is at least 27 years old and has already paid pension contributions for five years .
For the first time, anyone who receives the pension information receives an overview of which claims have been acquired so far . But more can usually not start with the information . Sometimes the amounts can even be very sobering, since at the beginning of working life rather little is earned and therefore correspondingly low pension contributions are paid. If income rises and stabilizes, the values for the future standard retirement pension will be more meaningful. However, consumers should not forget that these are extrapolations that are subject to certain conditions.
Check Pension Information – request insurance history
“Pension insured persons should have their pension insurance provider send them their personal insurance history ,” advises Herbrich. Through him, they learn, for example, whether really all pensionable periods were taken into account in the pension information.
Pension information only indicates the amount of the gross pension
The German pension insurance points in the pension information point out that “from the pension and health and nursing insurance contributions and, if necessary, taxes have to be paid.” But in the following, only gross values are given. It is therefore difficult for consumers to estimate how much their pension will be after deduction of all items . This approach has recently criticized the ARD business magazine Plusminus. The letter was even referred to as pension illusion. According to the magazine, workers received “a good quarter less than expected”. In view of this criticism, it is all the more important for consumers to understand the information in the pension information as a rough guide rather than as a fixed amount.
Status quo of pension rights
As the pension information informs consumers about the status quo of their pension rights at the time of dispatch, future pension reforms can of course not be taken into account. In July 2014, for example, the so-called maternity pension was introduced, which changed the pension rights of women whose children were born before 1992. Affected individuals will therefore see changes in the projected pension value compared to the previous year in their current pension information .
Pension at 63: high demand for advice
The Federal Association of Pension Consultants eV has noted due to the mother’s pension a short-term interest in consulting . There is still a great deal of need for advice in the last year introduced abschlagfreie pension with 63. Marina Herbrich reported in an interview with finanzen.de that the advice from the pension providers sometimes “difficult” designed. For example, the information provided by a counseling center has proven to be wrong. Expecting to be able to retire early within a few weeks, a client announced her job. As it turned out later, however, the actual time until the tee-off-free retirement was much greater.
Anyone who plays with the idea of retiring early, should confirm this step by the pension fund in writing , advises Herbrich. Even though the counseling centers do a good job, they demand that the consultants work with care and thoroughness at 63 with the new rules on pensions. “
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