Riester, Rürup, Blüm...retirement provision for students
The Riester pension is a privately financed pension in Germany that is supported by the state through allowances and special expense deduction options. The funding was introduced by the Retirement Assets Act (AVmG) and is regulated in Sections 10a, 79 ff. of the Income Tax Act. This means that in addition to the money saved for your pension with a Riester product, the state adds something on top of it (allowances).
The offer goes back to Walter Riester, who, as Federal Minister for Labor and Social Affairs, proposed promoting voluntary retirement provision through a retirement provision supplement.
Students are only entitled to allowances (= receive funding from the state) if they are subject to pension insurance. As soon as you as a student work beyond the marginal income threshold, pension insurance contributions of around 19.5% must be paid equally by the student and half by the employer. Then you are subject to pension insurance. It's enough if you only have to be insured for one month of the year to receive the funding.
The allowance in the Riester pension is then per year:
For singles: 154 EUR
For married couples: EUR 308
Child allowance: EUR 185 (EUR 300)
There has also been a career entry bonus since 2008:
Young Riester savers receive a basic allowance increased by EUR 200 in their first year of savings. Requirements:
1. The Riester saver must not have reached the age of 25 by January 1st of the year in which he concludes the contract.
2. He must be immediately entitled to an allowance.
This bonus has only been available since January 1, 2008; i.e. everyone who was born in 1982 or earlier gets nothing. The bonus is automatically credited in the first year of the contract in the form of a basic allowance increased by EUR 200. If the basic allowance is reduced (e.g. because the minimum contribution was not met), the bonus will also be reduced to the same extent.
You can request non-binding information on the subject of Riester pensions directly from our cooperation partner Deutsche Academic Finance.
The basic pension , colloquially known as the Rürup pension after the economist Bert Rürup, is a form of state-subsidized (better: funded) retirement provision since 2005. It is based on a pension insurance contract that corresponds to the statutory pension in terms of benefit criteria and tax treatment; However, the basic pension is not pay-as-you-go, but rather funded. In contrast to the classic private pension insurance, similar to the Riester pension (where 30% partial capital payout is possible at the start of the pension), the Rürup pension does not have the right to choose a capital, i.e. the amount saved may not be paid out in one lump sum, but is annuitized for life.
The Rürup pension generally makes little sense for students. Tax incentives are generally not relevant due to low income.
“Because one thing is certain: the pension.” The German Labor Minister Norbert Blüm put this slogan on election posters in 1986. Since this statement is no longer believed, this claim has since been parodied and quoted many times.
However, one must add that this statement does not mention either the retirement age or the pension amount.
In September 2008, Blüm wrote under the headline “The pension was secure” in the Süddeutsche Zeitung:
“'The pension is secure,' I said twenty years ago. Now one may ask: which ones? Definitely not the stock market-oriented one! Of 112,000 pension funds in the United States, 32,000 survived. Such a disaster has never happened to the pay-as-you-go pension insurance.”
The Riester pension is a privately financed pension in Germany that is supported by the state through allowances and special expense deduction options.
