When you apply for and start receiving your occupational pension (company pension), you have several choices. These choices can have major consequences for your financial situation. It is important to understand these options well before making a decision.
1. Timing: When Do You Want to Retire?
You do not have to retire at your standard retirement age. You can choose to retire earlier or later.
Retire Earlier (Early Pension)
You can retire up to 10 years before your standard retirement age. This can be fully, or you can partially stop (usually 5 years before your retirement age) and start your pension early to supplement your salary.
Retire Later (Deferred Pension)
You can also choose to work longer. You can defer your pension for up to 5 years after your standard retirement age.
Standard Retirement Age
This is the age set in your pension plan, usually around 68 years. This is your starting point, but you have a lot of flexibility.
2. Payment Form: How Do You Want to Receive Your Pension?
You can choose how you want to receive your pension. Several options are available:
Fixed Pension
You receive the same amount each month for the rest of your life. This is the simplest option.
Variable Pension
The amount can fluctuate, for example depending on the investment results of your pension fund.
High-Low Pension
You receive a higher amount first, and after a certain period a lower amount. This can be useful if you still have debts (such as a mortgage) that you want to pay off.
Low-High Pension
The opposite: a lower amount first, later higher. This can be useful if your partner is still working and you can live on that income.
3. Survivor Pension: Protection for Your Family
You can exchange part of your old-age pension for a higher survivor pension. This means your partner and/or children receive more if you pass away.
When Can You Do This?
You can make this exchange on your pension date or when you stop working for your current employer.
When Is This Wise?
This is especially useful if the survivor pension is insufficient to secure your family financially. Ask your pension provider about the conditions and possibilities.
4. Part-Time Pension: Gradual Transition
You do not have to stop working completely. You can partially retire and continue working at the same time.
How Does This Work?
You partially stop working and let your pension start early. This additional pension income helps you supplement your salary while you continue working.
Benefit
This gives you a gradual transition to full retirement, instead of abruptly stopping work.
⚠ All these choices must be made by your pension date at the latest. Some choices can be adjusted later, but it is important to consider this carefully in advance.
Consult a Specialist
Pension choices have major financial consequences. Before making a decision, we recommend that you seek advice from a financial advisor or your pension provider. They can help you make the best choice for your situation.
Next Step
Now that you know what choices you have for your occupational pension, it is important to review these carefully with your pension provider. You can also contact our advisory firm for specialized advice on your pension situation.