Pension compass: Men want a significantly higher pension than women. But reality often cannot keep up with dreams.
How much pension will I get in old age? When is the earliest I can stop working? Are the statutory pensions enough? who in the second half of life has arrived, he is increasingly concerned with these questions – and even more so with precise numbers and answers to them.
But in view of the currently strong inflation and the geopolitical power struggles, it is difficult to give reliable answers. Looking into the future is more difficult than ever. But the need for information is great.
At the largest German insurer Allianz alone, more than 500,000 people have used a pension compass online in the past two years to find out how they can achieve their self-imposed desired pension and how big the financing gap is. Of the pension compasswhich everyone can use free of charge, calculates future retirement provisions based on personal income and assets.
Pension: State pension is only sufficient as basic security
Most users are between 25 and 65 years old, with the greatest interest among 55 to 60 year olds. 80 percent of the inquiries come from employees, followed by the self-employed (10 percent) and civil servants (4 percent).
Currently received around 21.2 million Men and women in Germany have a statutory pension. Another 56.7 million pay into the statutory pension fund. According to Stiftung Warentest, pensioners need around 80 percent of their previous net income if they want to maintain their usual standard of living.
One thing is clear: the state pension is usually sufficient for basic security at best, as the pension compass also shows. In order to close the pension gap to their own desired pension, citizens in Germany have to take care of themselves – and should start as early as possible, at the latest when they start working, recommends Alf Neumann, Operations Director at Allianz Leben.
Pension: On average, men want a pension of 2788 euros
According to the pension compass, men would like an average desired pension of 2788 euros, and women are aiming for a pension of 2247 euros. According to the Allianz study, those who have the prospect of a company pension generally want a higher pension. Men then name amounts of 2884 euros, women assess their desired pension including company pension at 2375 euros.
Yet wish and reality differ greatly: even among 65-year-olds, according to the Pension Compass, only 28 percent will actually achieve their self-imposed pension target, among 60-year-olds it is 22 percent, and among 50-year-olds only 16 percent. Across all age groups, only 14 percent of men and 12 percent of women will receive their desired pension, says Laura Gersch, CFO of Allianz Versicherung.
It is also important to take tax and social security deductions into account, since retirement income is not tax-free either. For example, anyone who receives 4082 euros gross via pension, private and company pension schemes must reckon with taxes of a good 1400 euros for taxes, health and care contributions, so that only around 2600 euros remain.
Pension: Inflation is becoming a threat to pensions
There is great uncertainty due to the increasing inflation rates, which will also have a significant impact on pension targets. “Anyone who wants a pension in 33 years that corresponds to the purchasing power of 2160 euros today, with average inflation of two percent, will get a desired pension of 4152 euros a month at retirement,” calculates Neumann. “Anyone who expects inflation to be permanently high at four percent will end up with a desired pension of 7,881 euros.”
How much money everyone needs in old age basically depends on their own requirements. Some live modestly, others don’t want to do without a car or travel.
Pension: This is the gross statutory pension
The average statutory gross pension in Germany is currently 1466 euros. In 2020, men received an average of EUR 1,632 after 35 insurance years, and women EUR 1,225. But these are average values. However, the individual statutory pension varies greatly – depending on the personal employment history, the level of income, the years of study or maternity and paternity leave and the earnings points collected.
the retirement plan is therefore very individual. There is no rule of thumb for the perfect provision. Anyone who works in a company with a company pension scheme is already much better protected. But real estate, capital investments such as gold and shares as well as private provision through life insurance or a Riester pension are also helpful, according to Neumann: “A good spread helps.”
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