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Either the employer (AG) and the employee (AN) together or only the AG can pay into the occupational pension scheme (bAV). If the employee also makes payments, these payments are regarded as so-called deferred compensation. In this case, you waive part of your salary, which then flows into the occupational pension scheme. This saves taxes and social security contributions because the payments are deducted from your gross income.
By the way: Since 2019, a mandatory employer contribution of 15 per cent applies to all newly concluded contracts for occupational pension schemes. Since 2022, this has also been mandatory for old contracts.
How long is the occupational pension paid?
The occupational pension is paid for life. If the pension recipient dies, the surviving dependants receive 100 percent of the pension until the end of the contractually agreed pension guarantee period. Depending on the contract design, the remaining capital can alternatively be paid out to the survivors.
At Horizon65 we can help you to determine if company pensions are worth it for you by using our mobile app to simulate its effect on your future taking into your existing investments and potential impact of inflation and taxation.
We regularly help our clients by comparing all the available company pension products on the market using our comparison portal or you can also directly get in touch with our experts to understand if it can be a good option for you.