No Work, No Pension - But There's Still Support in Germany 🔥
- by Matthias Urbach
- 3 Min
Unemployment Benefits for the Unemployed: Inquiry About Eligibility for those Yet to Contribute - Unemployed and Retiring with No Savings: Determining Pension Amount for Unpaid Contributions
Here's the bottom line: If you've never worked, you won't receive a pension. But that doesn't mean you'll be left empty-handed.
Parents who have more than one child can still qualify for a pension claim, as the pension insurance considers their child-rearing work significant. Learn more about it in-depth below.
The German government takes care of its citizens who can't support themselves independently. If you don't work yet and haven't reached retirement age, you might be entitled to Citizen's Allowance (formerly "unemployment benefit II", briefly "ALG II" or colloquially also "Hartz IV").
Scraping by on Basics
If you've not saved enough for retirement through insurance or can't claim pension benefits another way, you may get Basic Security. This benefit is intended to provide a safety net for your basic needs. The German Pension Insurance sets a benchmark: If you have less than 1062 euros to live on a month, you should verify your eligibility for Basic Security.
The conditions for Basic Security and Citizen's Allowance are remarkably similar - and you must apply for both at your local social welfare office. You can occasionally apply for Basic Security with the pension insurance instead, who then just forwards your application to the welfare office. If granted, Basic Security is paid for twelve months, so an application must be made every year.
No Concessions for the Wealthy
Social benefits in Germany are affected by recipients' assets and income. In general, you need to exhaust your assets before you qualify for Basic Security. However, some assets like money up to 10,000 euros, reasonable household goods, significant personal heirlooms, a house or apartment within reason regarding state support, and more, are excluded.
In addition to assets, income is also factored into Basic Security. Since we're assuming you've never worked, bear in mind that maintenance payments, rental income, interest, life insurance, survivor pensions, and more are considered.
The German Pension Insurance's Handbook
The German Pension Insurance has a guide covering all aspects of Basic Security. Here is the link to download the PDF.[German Pension Insurance Basic Security Handbook]
Parents - Your Time at Home Matters
As described earlier, parents can apply for a pension even without any professional history: the so-called child-rearing periods. Typically, the mother is credited with three pension years per child. If the child was born before 1992, it's only two and a half years of pension time. Parents who have five pension years have already earned a pension claim. The German Pension Insurance calls this a "waiting period." It is essential to note that an application is necessary - they don't process it automatically.
Four Kids Can Score You up to 450 Euros
The three years per child can only be claimed by one parent at a time. However, parents can divide the "waiting period" between themselves. It concerns the primary caregiver. Pension years are only available as long as they don't have claims for child care from other sources (for example, civil servants).
Pension years are esteemed around one contribution point, making the mother or father have the same pension claim as if they had earned almost the average wage. Even four child-rearing years (twelve years) are not enough to generate a pension claim that surpasses Basic Security. The pension insurance pays a maximum of 451 euros (as of April 2024) for a parent who hasn't worked, for four children. [Visit the DRV here]
- Basic Security
- German Pension Insurance
- Pension Claim
- Parents
- Children
- component resolution model
- The German Pension Insurance considers child-rearing work significant, allowing parents who have more than one child to qualify for a pension claim.
- Recipients of Basic Security may be entitled to vocational training support, as part of the German government's wealth-management and personal-finance strategies.
- Under certain conditions, exceptions can be made for the dependent, allowing them to qualify for support like Basic Security even if they haven't reached retirement age.
- The German Pension Insurance offers a handbook that provides guidance on various aspects of Basic Security, including how it may be affected by one's assets and income, and how to apply for it.
