Statutory old-age provision: the need for money keeps increasing: the situation of our pension insurance is so serious
The German pension insurance is facing major financial challenges. There are several reasons for this. And the situation will worsen again in the next few years. But the parties are hiding the problems ahead of the general election. What future retirees have to be prepared for.
In 2020 the Premium income the statutory pension 252.2 billion eurosas shown by the German Pension Insurance (DRV).
On the other hand, the DRV had expenses 338.3 billion euros to shoulder. The gap between premium income and expenditure therefore amounted to around 86 billion euros. The billion hole was filled with the help of the so-called federal grant. The taxpayer bears it.
Demographic change places an increasing burden on the system
Demographic change will put the statutory pension system under even greater pressure in the coming years. There are more and more retirees – and they can enjoy their retirement longer and longer. At the same time, the number of contributors will decrease in the coming years: The baby boomers will retire from 2025 and will of course no longer pay any contributions.
All of this leads to a sharp rise in pension insurance expenditure – with consequences for the insured and retirees.
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Contribution rates are expected to rise
The contribution rate to pension insurance is currently 18.6 percent of income. Employees and employers share the sentence.
The demographic change described makes an increase in the rates necessary. The DRV has made sample calculations for this.
At the same time, the so-called sustainability reserve is decreasing. Experts understand this to mean the financial reserves of the statutory pension insurance. Here the DRV expects a massive slump in the coming years: The currently still high billions in reserves will melt away (see third line in the following table).
If the DRV’s forecast is correct, the pension fund will be emptied in the coming years, even though insured persons and companies pay higher contributions. In view of this development, there is an urgent need for action.
In order to plug the ever-growing financial gaps, experts consider an increase in the retirement age to be inevitable. CDU boss Markus Söder and Greens co-boss Robert Habeck recently rejected this.
That is hardly surprising: before the general election on September 26, no politician dares to pour pure wine to the voters. “Pension Pope” Bert Rürup recently pointed out in an interview with FOCUS Online that the average age “of those eligible to vote is already around 54” in the federal election. The parties are dependent on the votes of the future retirees. The future retirees would hardly honor “threats” with an increase in the retirement age.
CSU boss Söder is even calling for the maternal pension to be extended to all children. Union chancellor candidate Armin Laschet does not want to support that. If it were to expand, the holes in the pension fund would be even bigger.
How ever the coffers of the pension insurance can be filled in the coming years remains to be seen. But no politician warns current and future retirees about the challenges for statutory old-age provision. “Instead, the blue sky is promised,” criticizes pension expert Bernd Raffelhüschen from the University of Freiburg.
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