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The statutory pension insurance (GRV) calculates your pension according to the following formula:
Amount of monthly pension = earning points x access factor x pension factor x current pension value.
Brief explanation of the individual factors:
Earnings points: For each year of work in which you pay into the SPS, you receive so-called earning points (EP). If your salary corresponds to the average income, this is exactly one EP per year. If you earn more, this value is greater than 1, if you earn less, it is less than 1.
Access factor: The access factor (ZF) stands for the retirement age. If you retire at the standard retirement age (67 for most people), the IF is 1. If you retire later, you receive a supplement; if you retire earlier, you are subject to deductions.
Pension factor: The pension factor depends on the type of pension (old-age pension, disability pension, widow’s pension, etc.). For old-age pensions, this factor is 1.
Current pension value: The current pension value is the value of one income point. In 2021, the value for 1 earning point was 34.19 euros (West) and 33.23 euros (East). This value is regularly adjusted by the GRV in line with economic developments, inflation, etc.
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.