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Benefits of Pension Schemes: Current Period Offers Advantages

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Increased pension benefits during these times offer an advantage
Increased pension benefits during these times offer an advantage

Benefits of Pension Schemes: Current Period Offers Advantages

In Germany, understanding your pension is crucial for a secure retirement. Here are some key points to consider:

  1. Importance of Detailed Information: The history of pension insurance does not explicitly mention occupation, retirement status, or specific insurances. However, these details are essential for accurate pension calculations. Employees are advised to compare the pension insurance details with those in their employer's social security certificate and notify the pension insurance of any discrepancies.
  2. Entgeltpoints and Pension Calculations: Entgeltpoints are a crucial basis for calculating pensions. More points lead to a higher pension. Employees earn these points based on their wages, with individuals receiving sick pay also earning points based on 80% of their previous earnings.
  3. Maternity Leave and Pension: Maternity leave positively impacts pensions through 'credit time', which covers the period from six weeks before to eight weeks after birth.
  4. Apprenticeship and Pension: Apprentices earn few pension points due to low wages, but the pension insurance can add up to 0.75 points for a maximum of three years to account for training times.
  5. Unemployment and Pension: Unemployment periods contribute to pension calculations. The employment agency covers contributions based on 80% of previous gross salary, equivalent to one pension point for a €5000 monthly salary.
  6. Retirement and Additional Documents: Even if they are already retired, insured individuals can submit additional documents to the pension insurance. These could be old certificates that can be included in the pension calculation.
  7. Rentenpoints: Everyone who pays contributions into the statutory pension insurance scheme receives Rentenpoints. Currently, a Rentenpoint is worth 40.79 euros. The conversion factor for Rentenpoints is legally determined and is individual gross income divided by the average income of all contributors.
  8. Caregiving and Pension: Care of needy people can be taken into account for pension calculations. The number of bonus points depends on the type of care and the care level.
  9. Education and Pension: While school and university time do not count towards earning pension points, they can be considered as 'credit time'. Fachschule attendance is credited with up to 0.75 points per year.
  10. Parents and Pension: Parents can increase their pension by earning points based on their children's birth years, up to 36 months or 3 points for children born after 1992.
  11. Pension and Taxes: Pensioners should keep taxes in mind, such as Brutto and Netto in retirement, to ensure a comprehensive understanding of their pension income.
  12. Regular Updates: The pension insurance regularly informs contributors about their pension account status and lists relevant times for the pension insurance. Contributors should compare these details 'point by point' with their CV to ensure accuracy.
  13. Average Income: In 2025, the average income of all contributors will be exactly 50,493 euros.
  14. Care System and Pension: The care system is not directly related to pension calculations, but the number of bonus points for caring for needy people depends on the type of care and care level.
  15. Activities Beyond Wages: Besides wages, activities such as periods of child-rearing, caregiving for others, and voluntary private or company pension contributions count toward pension points in German retirement provision.

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