Actually, the statutory pension should secure the existence after working life – that’s the theory. In practice, things are very different: if you want to have a monthly pension of at least 2,000 euros, you have to earn a lot and hold out for decades.
Would you like to draw a gross pension of EUR 2,000 when you retire? Much luck! This is theoretically possible – but only very few Germans will make it. Because in order to get this amount, you have to earn at least 4500 euros gross at a young age – ideally at the start of your professional life. And they have to keep this income. At least 45 years.
The pension is a benefit that employees receive if they make appropriate contributions. Anyone who pays longer than others or pays higher contributions will generally also receive a higher pension later on.
The monthly pension amount is made up of what is known as the “pension formula for old-age pensions”. Crucial are:
The pension formula looks like this:
In addition, the amount of the pension entitlement depends on the employment history of the employee, emphasizes the German Institute for Old-Age Provision at the request of FOCUS Online. The factors that determine the amount of your pension include inflation, wage increases, job changes, unemployment and the question of whether the pension is drawn in East or West Germany.
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And these factors usually do not make it easier for you!
Anyone who currently earns 6,000 euros and still has a few years of working life ahead of them would not easily get a pension of 2,000 euros. The rule of thumb is that the employee makes a lot of money right at the beginning of his career. This is also shown by the following rough sample calculation.
In 2033 Mr. Müller will retire after 45 years of work. According to a rough pension estimate, he is then entitled to a pension of almost 1860 euros – if he continues to work under the current conditions until then. The corresponding pension values from 1988 to 2023 were included in the calculation for the survey. The pension value between 2024 and 2033 is based on the value of 2023, since there is no data for this.
Why does Mr. Müller not get a full 2000 euros? Because Mr. Müller needs 56 earnings points to get to this value due to the standard retirement age, the pension value West and the pension factor 1 due to age (as of 2023, estimate). However, he was able to “only” collect 51 payment points before he retired.
A remuneration point consists of the average salary. In Germany (as of November 2021) an employee must earn at least 3241.75 euros (gross) per month in order to achieve a remuneration point.
In 45 years of work, Mr. Müller would collect 45 earnings points if his salary between 1988 and 2037 was at an average level of 3242 euros gross per month. But at the start he only earned 4100 German marks (equivalent to 2096.30 euros). In the meantime he didn’t even get over 3000 euros. After all, Mr. Müller collected around 1.83 pay points annually between 2013 and 2021.
In order to achieve the 56 earnings points, Mr. Müller would have to earn a good 33 percent more than the average German citizen – and that already from 1988. That would be at least around 4320 euros gross per year as of today. At the same time, Mr. Müller’s salary must increase during this period of time, just like the average salary of Germans and for inflation in Germany.
But the most important thing is that Mr. Müller has to persevere. If he retires a year earlier, the access factor drops from 1 to 0.96 and with it the amount of the pension.
Career starters only earn these sums in extreme cases and even during their professional career, some jobs do not even come close to this value.
According to a survey by the Federal Statistical Office, bakery employees earn an average of 2,383 euros gross. That makes (as of November 2022) 0.73 earnings points per year and 36.01 earnings points for retirement after 49 years. With a pension value of 36.02 euros, that makes an estimated pension amount of 1,297 euros. Prerequisite: 49 years fully earned, pension at standard entry age.
Hairdressers don’t even earn 1800 euros. This corresponds to 0.55 payment points. After 49 years, a hairdresser collects 27.2 points. What constitutes an estimated pension amount of 979.93 euros.
If you want more pension, you have to look for alternatives. “Employees who want to close a pension gap must now make private provision,” explains the German insurance company to FOCUS Online.
Around 25.86 million people (as of November 2022) receive a pension from the German pension insurance. After deducting orphans’ pensions, there are a whopping 21.26 million pensioners. Only a fraction of them get 2000 euros or more transferred every month: In 2015 there were just 97,271 affected.