The opportunity to secure an EU pension is an underappreciated, but a very significant benefit of working for the EU institutions: European Commission, European Parliament, European Council or any of the 40+ EU agencies and several other EU institutions.
The EU pension is a defined benefits/final salary scheme that guarantees you an inflation-adjusted monthly income until your death. Additionally, after you pass away, your surviving spouse will continue to receive a survivor’s pension until her/his death that is a significant part of the pension you were entitled to.
While all of the information below is from public sources, it is often hard to access and understand due to “legalese” and the the sheer size of the documents. This article outlines the main facts about ‘EU pensions’ in an easy to understand manner.
How to qualify for a European Commission pension?
Anyone who works for the European Commission, European Parliament, an EU agency or another EU institution, is entitled to an EU pension after 10 years of service. You have to accumulate your 10 years before you reach either the mandatory pension age (66 years in 2021) or early-retirement age (58 years in 2021).
You can work for different EU institutions at different times in your life. All of your employment periods in EU institutions will be summed up and count towards a 10-year minimum as long as you do not withdraw the accumulated pension capital to a private pension scheme.
The pension contribution (tax) is the largest deduction of one’s salary. 9.7% is automatically deducted from your salary each month to accumulate the pension capital, and no actions need to be taken by you.
What is the mandatory European Commission pension age?
The mandatory pension age is 66, at which you will be able to receive the full amount of pension that you are entitled. It is possible to work until 70 if it is exceptionally justified. After reaching 70 a person is retired automatically and there is no possibility to remain in employment of EU institutions.
How large is a pension after working for EU institutions?
There is a minimum pension for former EU officials. It cannot be less then 40% of the basic salary for an EU official in the AST 1 (step 1) category. In 2023 this amounts to EUR 1331.00 (salary for AST 1 EUR 3327,49 * 10 years of service * 4%).
European Commission Staff Regulations
Hi and thanks for reading the article!
If you found it useful, please consider to
Your pension after the 10 mandatory years of service cannot be less than the minimum pension for EU officials – see above. If you are interested in more detail, the answer depends on a number of factors:
- Length of service. For each year of employment a person is entitled to 1,80% of the final basic salary. For example, if you have worked for EU institutions for 10 years, you will be entitled to 18% of your final basic salary; 20 years will qualify you for 36%; 30 years – 54%; 40 years – 72% (which will be capped at 70%).
- Basic salary in last employment position. Your pension will be calculated as a percentage of the basic salary.
- Pensions are adjusted to the actual cost of living in the European Union and should slightly increase over time.
- The final pension amount may not exceed 70 % of the final basic salary.
If you have worked for several EU institutions, your pension will be calculated based on the last basic salary you received.
In practice, if you are an AD5 in Brussels at the end of your career with a basic salary of 4883, you would be entitled to the following amounts proportionally to the time worked for the EU:
- 10 years = EUR 4883 basic monthly salary X 1.8% X 10 years = EUR 878.94. In this case you would instead receive the European Commission’s minimum pension of EUR 1200.24.
- 20 years = EUR 1757.88
- 30 years = EUR 2636.82
- 40 years = EUR 3515.76
Of course, if you start as an AD 5, your final basic salary would actually be higher as you would advance through the steps of the pay scale every two years. The above calculation is meant to just be an illustration of the principle.
Pensions and the Correction Coefficient
The European Commission Correction Coefficient is not applied to pensions (Article 82 of Staff Regulations). In practice this means that you will receive the same pension independent of where you live after retirement.
Can I retire early? What are the consequences?
The early retiretirement age is 58 years (in 2021).
An early retirement pension amount is reduced 3,5% for every year before mandatory pension age of 66. Hence, if you decide to retire at 58, you will incur a 28% reduction of your pension. Unfortunately, the pension will not increase once you reach the regular retirement age.
Can the EU pension be inherited by a surviving spouse and/or dependent children?
Yes. The surviving spouse of a former EU official is entitled to 60% of the pension paid to the official. The amount that can be inherited by dependent children varies on the individual situation and the ‘orphan’s pension’ can only be precisely calculated by the Paymaster’s Office.
EXAMPLE
If you are entitled to the minimum European Commission pension of EUR 1200.24 (100%)
THEN
your surviving spouse will receive up to EUR 720.14 (up to 60% of former official’s pension) until her/his end of life.
Divorced spouses are also entitled to a survivor’s pension if they can prove that the (former) EU official was supporting them based on a court order or an officially registered settlement in force between both parties.
If you are in such a situation, please contact either the European Commission’s Paymasters Office or the HR Department of the last institution your spouse was working for in order to find out the steps to take.
Very important – unless there are proven force majeure factors, the survivors pension has to be requested within one year of the former EU official’s death. Otherwise, the spouse’s and dependents’ rights are forfeited.
Does my EU pension capital accrue interest while I’m waiting for my pension age?
Yes. The accumulated pension amount accrues compound interest at a rate of 2.9% per year (in 2021).
What if I leave an EU job before I accumulate 10 years of service?
For most people the best strategy is to leave your pension capital with the European Commission Paymaster’s office as it accrues a 2.9% per annum in interest. You can accumulate your 10 years in EU institutions over an unlimited number of instances of working for EU institutions until the mandatory retirement age of 66.
Some institutions strongly encourage the “transfer out” of the accumulated EU pension capital claiming that it might be “very hard” to do it at a later date. However, there is no particular difference in the amount of work for you whether you decide to move your EU pension capital to a third tier pension management fund right after leaving an EU institution or much later. The only caveat – you pension capital left with the EU Paymasters Office will be completely lost if you happen to die before reaching your pension age. And, of course, don’t forget about your pension capital once your retirement age comes and you have not accumulated the necessary 10 years to qualify for an EU pension.
If you decide that you never again want to work for the EU, you can “transfer out” your pension capital to any of the European Commission-approved pension management schemes in all EU member states. The funds will only become available to you once you reach the age of 60.
Reasons to “transfer out” your accumulated EU pension capital:
* You do not plan to ever again work for EU institutions
* You are certain that you will be able to invest your EU pension capital in an investment vehicle that returns substantially more than 2.9% per annum
* You are worried that you might die before retirement age (chronic disease, family health history, dangerous hobby, etc.)
Once you “transfer out” but again start working for a EU institution, you will be able to transfer in your accumulated pension capital, but not the accumulated ‘pension years’ to qualify you for an EU pension. So – choose carefully.
Not only an EU pension, but also health insurance for you and your spouse
After an EU official becomes entitled to an EU pension, the person and his/her spouse and any dependents also become entitled to the JSIS – the European Commission healthcare insurance scheme. It reimburses between 80-85% of most healthcare costs. If you have what are considered serious illnesses you can obtain a 100% reimbursement. This should be a major appeal for people in retirement.
If there are any dependents, the retiree is also entitled to the relevant allowances such as the household allowance and dependent child allowance.
Where to get consultations and help regarding European Commission pensions?
Former employees of EU institutions are usually advised to contact the HR department of the last institution they were employed by.
It is also possible to get in touch with Office for the Administration and Payment of Individual Entitlements also know as the Paymasters Office (PMO), contacts here. If you have questions about JSIS, the European Commission health insurance scheme, including coverage of funeral expenses, you can find the relevant Paymasters Office contacts here.
AIACE – International Association of Former Staff of the European Union
When you retire from an EU institution, consider becoming a member of AIACE. For the 40€ annual fee (differs by location of national units) you can get a number of benefits:
- Access to a helpdesk (consultations on key retiree issues). Virtual and in-person consultations in Brussels
- Legal assistance at a reduced fee
- Special complimentary insurance availability to complement risks not covered by the JSIS (currently offered by Cigna)
- Accident coverage
- Coverage of the difference in all medical costs and those reimbursed by the JSIS
- A monthly Cigna consultation
- Quarterly VOX bulletin sent to all of the retired staff. National bulletins sent to members of country chapters
- Yammer chat
- Voluntary work opportunities and possibility to received help from other volunteers; social contacts and events
Main facts about AIACE:
- AIACE has special Partnership Agreements with the European Commission, the European Parliament, the European Court of Justice, the European Social and Economic Committee, the Committee of the Regions, the Court of Auditors, and the Council. All the above institutions recognize AIACE as the representative of their retired staff
- Founded June 1969, AIACE has over 12000 members out of a total approximately 23500 retired staff
- 15 national branches (20 retirees can form a national branch)
- AIACE lobbies on behalf of retired EU officials and defends their rights at the European Commission and other EU institutions. AIACE is even an official member of a number of working groups that affected the interests of former EU administrative agents and contract agents
AIACE contact details:
- Website: www.aiace-europa.eu/
- Address: N105 00/23, 105 Avenue des Nerviens 00/036, Brussels, 1040, Belgium
- Telelphone: (Belgium): 02.2952960
- Email: aiace-int@ec.europa.eu
Frequently Asked Questions
EU officials have their own pension scheme, managed by the European Commission. This pension scheme serves the former statutory staff of the European Commission, European Parliament, European Council, the 40+ EU agencies and all other EU institutions.
The minimum pension for EU officials cannot be less than 40% of the basic salary for an EU official in the Assistant grade AST 1 step 1 category. In 2023 this amounts to EUR 1331.00 (salary for AST 1 EUR 3327,49 * 10 years of service * 4%).
Yes, pensions of former EU officials are regularly adjusted to inflation the same way as salaries of Administrators, Assistants and Contract Agents. As an example, the minimum EU pension in 2021 was around 1200 euros, but rose to 1311 euros in 2023 as salaries of EU officials also increased.
Mandatory pension age for EU officials is 66. EU officials can retire early from the age of 58, but they take a permanent decrease of their pension for every year of early retirement. Pension of an early retiree does not increase once the person reaches age 66.
Do you still have questions regarding EU pensions?
As usual, if there is an unanswered question or you have spotted a mistake, please write a comments and me and the EUE community will do our best to help and update the article.
This article is based on the European Commission Staff Regulations and other publicly available information such as EU institutions’ vacancy announcements.
165 responses to “Pensions for Staff of European Commission and other EU institutions”
Kindly clarify, if possible how the basic pension is calculated if the minimum of 10 years of service are completed at age 53, and then I resume a national employment until 66 years old.
Is the pension at 66 based on the acutal salary numbers of that future salary level or my last salary of the employment at age 53?
Also for the transfer in procedure is there a maximum number of equivalent years that can be achieved with my national funds etc?
i.e. if my national pension funds are big enough could they be counted as e.g. 30 years?
Many thanks for your clarifications!
Thank you for an invaluable resource.
I have a question on the transfer-in process. I have a UK-based private pension fund with one of the largest fund managers there. I would like to transfer that in the EU system where I now work. I understand this right is not guaranteed, and also that it can take a very long time (several years, apparently) to have a reply from PMO after making a request. Is this true? It would be difficult to make retirement/career plans during that time. Also, the value of the fund fluctuates over time, up and down. How would fluctuations be treated between the time I make the request and the transfer, if accepted?
Brian, hi! I assume you have a double nationality… or you’re using the post-Brexit arrangement where UK nationals with contracts prior to Brexit were allowed to stay and work in EU institutions.
Anyways –
1. According to my understanding you would have to first get 10 years of service in EU institutions. Only then you can transfer in your pension capital and increase your EU pension. I understand it’s not possible to serve the institutions for, say, 7 years and get the remaining 3 by a ‘transfer in’. If you have your 10 years, read on. The only exception would be if you’d reach 66 as the legal retirement age during EU institutions employment before 10 years of employment overall.
2. Regarding a transfer in, the institutions still struggle with post-Brexit legal arrangements, due both to EU-side but also UK-side issues like lacking legislations, rules of procedure and case law. Due to this I suggest that you write a formal question to PMO. This would give you the highest level of legal certainty. PMO contacts: https://commission.europa.eu/about/departments-and-executive-agencies/office-administration-and-payment-individual-entitlements_en#contact
All of the above is correct.
Specifically regarding the original question: My understanding is that it IS possible to transfer the capital value of the UK state pension into the Commission’s pension scheme. This is a transfer-in, which needs to be requested before 10 years of service. In this case, the UK DWP says “this person’s pension is worth 10k GBP” and then PMO says “OK, that is the equivalent of 2.5 years of Commission’s pension, which can be added to your years of service”. At this point, it is the original poster’s choice to go ahead with the transfer-in or not. All figures above purely illustrative.
HOWEVER, if the original poster is talking about transferring a SIPP (self-invested personal pension, which can be invested in stocks, funds and bonds and therefore its value fluctuates every day) into the Commission’s pension scheme, that is virtually unheard of. I am not even sure that a) the SIPP provider in the UK is able to execute the transfer and b) the PMO is able to accept the transfer.
At the very least, the original poster would have to sell all its holdings and willing to hold cash from the time the request is made until the transfer actually happens. As I said, I am not even sure the transfer is possible.
This is my current understanding, but any additional information (from PMO, perhaps?) is welcome.
As a final note, this scenario is not limited to UK nationals. Any EU national working in the UK can open a SIPP and then, at some point, be hired by the EU institutions. At this point, the question arises of what to do with a) the SIPP and b) the contributions paid in the UK to qualify for the UK State pension.
Thank you for the reply. I will consider asking a question to PMO, because this has a large impact on the benefit of my staying with EU institutions for 10y (and acquiring the right to a EU pension) or not.
In response to John Smith below, I am talking of a UK ‘workplace pension’, not the UK State Pension and not a SIPP. This is a very common scheme – the norm for employees in the UK private sector (on top of the UK state pension, of course). It is invested in funds which fluctuate. I have heard of individuals having this transferred in, but it was pre-Brexit and I don’t know the details. And it’s correct that the nationality of the employee is irrelevant, since anyone who has worked in the UK private sector is likely to have a similar pension.
Hopefully, the PMO will be able to clarify the issue.
As I said, it is possible to transfer your contributions to the UK State Pension into the EU Pension scheme.
When it comes to personal pensions (whether they are workplace pensions or SIPPs), things are much less clear. If you can share it, useful to know who your provider is (e.g. Aviva, Fidelity, etc.). And whether they have confirmed to you that they can execute the transfer (possibly after you sell all your assets to freeze their value in monetary terms, i.e as cash).
Good luck! It’s such an important piece of the overall puzzle – and yet so little information is available.
The way I understand it, a UK pension scheme can pay into a foreign scheme with no UK tax charged as long as the scheme is a ROPS. The EU Civil Service pension scheme seems to be one, but I would need to confirm that. Technically there should be no impediment to the UK side paying out, since workplace pensions can be entirely cashed in. It’s UK tax that may be the question (hopefully avoided if ROPS) and especially whether PMO accepts the transfer. I don’t see why it shouldn’t – a transparent fund value is easier to convert into years of EU service than years in a member state. But you never know.
The Commission’s pension scheme is indeed a ROPS – see here: https://www.gov.uk/guidance/check-the-recognised-overseas-pension-schemes-notification-list#countries-d-to-f
Whether any transfer out would be tax-free is not clear at all (the site mentions that rules changed in 2017… anything happened in that year or the year before? 🙂
And then there are the questions of whether the pension scheme administrator is able/willing to execute the transfer and whether the PMO will accept the transfer. And of course the time needed for all of this to happen.
Dear Ben, i have been on an invalidity allowance for 3 years due to serious illness. Are these years eligible for the 10 years of service. I had the option to keep on contributing to the pension scheme, which i chose to do.
Thank you.
Hi, Andre! My understanding is that the pension is NOT adjusted by the correction coefficient, i.e., you should get the same pension irrespective of where you live as a retired principle. In this sense the arrangement is similar to the EU unemployment allowance which is also not adjusted by the CC.
My understanding is that the EU pensions are adjusted by the correction coefficient. I do however live in a 100% coefficient country (Belgium) so I cannot confirm this via personal experience
Hello, gongrats for your insights. I would like to ask if it is possible for a person with less than 10 years of service in an EU institution to opt for leaving contributions accruing in the EU pension system, getting them later at the age of 66. Is this option available or in these cases (less than 10 years), it is mandatory to transfer out your contributions to the national scheme?
Thanks in advance!
Hi, Mike! My understanding is that it is possible. You can withdraw your contributions residing in the EU system at any time, but you can only gain access to the capital at the age of 58 if you opt for an early retirement. There are many cases where former EU institutions’ staff say they were “forced to” transfer out their capital at the time of leaving their institution. However, this seems to be more of manipulation and people gave in.
Hello,
I have already worked enough years to secure a pension, but I am contemplating taking a break for a couple of years to pursue another paid activity. For that I would ask for a leave on personal grounds (CCP).
I would like to ask if I may “buy in” the pension rights I acquired during that leave when I resume my job at the EU institution.
Thanks for your help,
Maria
Hello Maria,
this is a tricky question – Have a look at paragraph 3 of article 11 of Annex VIII (Pension scheme) of the Staff regulations:
https://eur-lex.europa.eu/legal-content/EN/TXT/HTML/?uri=CELEX:01962R0031-20140501#tocId248
“Paragraph 2 shall also apply to an official who is reinstated after a period of secondment under the second indent of Article 37 (1) (b) of the Staff Regulations and to an official who is reinstated following expiry of a period of leave on personal grounds under Article 40 of the Staff Regulations.”
I say it’s a tricky question because paragraph 2 includes the “before becoming eligible for payment of a retirement pension”… and you have already become eligible because you worked more than 10 years in the EU institutions.
What I am thinking is whether there are two scenarios: one where you go on CCP, say, after working for 5 years; and another one (which is your case) where you go on CCP after 10 years. With two different outcomes.
Not sure whether this helps – better check with PMO for a definitive answer.
Hi! The best thing is to attend one of the PMO seminars about pensions. If your HR doesn’t share this info about seminars, ask them proactively. PMO always encourages to write to them directly. PMO contacts: link to COM website
Dear Ben,
I am currently exploring the option of transferring my national pension contributions into the EU pension scheme and would appreciate clarification on the following matters:
– In my national pension scheme, it is possible to make additional contributions to account for years spent in education or military service, thereby recognizing those periods for pension purposes. If I transfer my national pension contributions into the EU scheme, will such years also be recognized under the EU pension system?
– Is there a requirement to have completed the minimum 10 years of service within EU institutions before initiating the transfer of pension contributions from a national scheme, or can the transfer be applied to help secure the 10-year minimum required for EU pension entitlement?
– In order to calculate if the transfer will be to my benefit, would it be possible please to let me know for each month after reaching the 10-year minimum threshold for an EU pension, how much does this increase the final pension benefit?
– Upon transferring national pension contributions into the EU scheme, are the corresponding years of pensionable service recognized in full as they are, or is their value adjusted in line with the EU pension contribution system?
Thank you for your assistance.
Petros, hi!
As far as I know, you don’t transfer “years” into the EU scheme, but pension capital which is “equalized” to your contributions while working for EU institutions. Because of this it’s very likely that 10 years in an EU member state pension scheme might turn out as 5 years or even less in the EU scheme. Best to ask PMO and national pension authority to do a calculation to decide if transfer in is beneficial for you.
You have to collect 10 years of working for EU institutions before you can transfer in.
Each year of working for the EU gives you a 1,80% increase in the final pension. Quoting the article:
“Length of service. For each year of employment a person is entitled to 1,80% of the final basic salary. For example, if you have worked for EU institutions for 10 years, you will be entitled to 18% of your final basic salary; 20 years will qualify you for 36%; 30 years – 54%; 40 years – 72% (which will be capped at 70%).”
You qualify for the minimum EU pension without reaching 10 years if you reach pension age of 66 years while working for an EU institution.
Hi, great article answering questions. From my experience, I had worked in organization for 2,5 years, had to do a break and was “forced” to take the pension contributions that I collected over those 2,5 years. Why I say “forced” – no other option was proposed, I just received an email saying that this amount will be sent back to my account… so I took it… Now I am back at the same organization and thinking of doing the minimum 10 years to get the pension, but those 2,5 years will not count. Asking around at work everyone is saying that it has to be 10 consecutive years, I guess this rule that it can be done in multiple instances is just not shared widely.
PMO really can’t force you to “transfer out”. Too bad very many people are manipulated this way.
I now it’s possible to transfer in your national pension scheme contributions. I wonder if it’s possible to transfer back in the previous EU pension scheme contributions that you’ve transferred out. Definitely something to look into.
You most definitely can collect the 10+ years in several “instalments”. I’ve checked with PMO.
Hi Ben and Simon above,
I cannot be certain but I am pretty sure I read that it is alwaxs psossible to do a transfer in after a transfer out, at least in the case of a transfer out to a private fund.
In other words, as far as I know if you transfer out to a fund then get beack to any EU institution you should be able to recover the constributions and pay them in the EU pension scheme.
Please don’t take my words as gold, better check it out with PMO…
Hi Ben and everyone,
For once I can help rather than ask for it..
Time ago I mentioned here that when you intend to transfer out your retirement contributions (if you have worked less than 10 years, of course..) there may be some countries which require to do so within 6 months from end of contract.
Well, after a lot of enquiries I have the following information:
– In the case of Spain, Belgium and Italy there is no 6 months rule; HOWEVER, what I have been told by all three is that if you want to transfer out to any of these three national schemes you can ONLY do it if you get a job in the country of interest AND within 6 months from 1st day of work there!
In other words, if you plan to retire early, or just can’t find another job, the only possibility is to transfer to a PRIVATE fund, such as Monet/Allianz in Belgium for example.
I hope this helps!
Dear Alessandro, thanks so much for sharing back!
This is an important nuance that should be updated in the article – transferring out to a private fund (also known as ‘3rd tier pension fund’) and the national pension scheme. I was not aware of the restrictions imposed by the national institutions, as the PMO webinars seem not to cover this aspect. So – it’s up to each person to inquire with the national state pensions authority.
Hello,
I have been working for the Commission as a DNE for nearly 4 years (2011-2014) and then for 6 year as Contract Agent. Does this DNE work count in this required 10 years in order to have the right for an EU pension? Thank you
Sorry, no, SNE employment period doesn’t count towards the EU pension. However, hey, at least it counts for the national pension. And then, if you’ll work for at least 10 years total for EU institutions, you can transfer in your national pension.
Dear Ben,
I worked for an EU institution one year only, then I resigned after the contract renewal to go back home and work there. I haven’t transferred out anything yet, and I am 54.
Do you think I can still claim my contribution regardless of my interrupting the contract?
Thanks in advance for for your help!
Kind regards regards,
Claire
Of course. You are entitled to the pension contributions and can either transfer them out or leave them in the EU system. The only instance when you can loose this amount if you suddenly die. If you do not plan to work for EU institutions ever again, I’d transfer out to a private pension fund so that in case of your unexpected death your relatives could inherit the amound. If you haven’t transfered out and suddenly die, the money is “lost”.
Hi all,
I worked for an Institution for 1 year and 3 months. I then stopped for a while, before moving on to another Institution, where I currently work.
I’ve been here for 2 years, and may stay here for another 4, for a total of 6. There haven’t been EPSO competitions for years, and one cannot rely on there being one in the near future.
Therefore, the gameplan is to face the possibility of retiring in 2029, with 7 years of service in total. At that point, if the 10 year = pension strategy is not possible, I would dearly like to access the funds that I contribute towards every month from my own salary.
Would the small gap between jobs prevent me from doing so? I would be able to use them to secure my financial position in retirement far better than leaving them with the PMO until 65 ever could. I pay pension contributions in my country.
Thank you,
Godfrey
Hi! If you haven’t reached 10 years of employment in total for EU institutions, you can always transfer out the 7-year long pension contributions to either your national primary pension scheme, or a private pension fund.
Importantly – I can’t find the precise stipulation in the Staff Regulations, but I believe that if you’ve worked for EU institutions less than 10 years but reach retirement age while being employed at an EU institution, you’re entitled to the minimum EU pension which is 40% of basic salary in grade AST 1 step 1 (AST1/1 amount for 2024 is EUR 3461,58 (Source is Article 66 of the 2024 Staff Regulations edition), hence 40% of this would be EUR 1384.60.
Hi! This is not correct, according to the answer I got from the EP Pensions and Social Insurance Unit: ‘You will be entitled to the minimum: AST1.1 x 4 % x number of years of service.’ In my case I will have been working 3 years in total, when I reach my retirement age.
Anders, thanks so much for sharing!
Would it be possible for you to share an anonymized response from HR to info@euemployment.eu. I’m wondering if there are more details in the reply and references to legal documents.
Hello, I receive 100% of an orphan’s pension. But I would like to start a company. I live in Germany and would therefore like to set up a limited liability company (UG). As this is a legal entity in Germany, I would like to know whether orphan’s pension recipients are allowed to set up a UG. As the sole shareholder, I would then only be paid out as much as I am allowed to receive each month (1200€) before tax (based on my current pension) and leave the rest in the UG. Am I allowed to do that? As far as I know, assets are irrelevant when it comes to paying out the pension. And the UG would be an asset in this case.
Because it is such a special case, it is incredibly difficult to find information about it.
Tax or business consultants here in Germany do not know anything about orphan pensions. And the pension office does not know anything about German law. I am so desperate. I have also asked the EU several times, but I never get a proper answer or sometimes I am told yes, sometimes no.
I am so desperate that I would even pay money if someone could help me.
Dear Herber,
This is indeed a very specific case. However, here’s a tip that can help.
You should address HR of the EU institution in which your parent was employed in writing. Explain the case and asking to provide a legally binding explanation. You can also address PMO, the Paymasters Office of the European Commission. Or write to both and ask them to reconcile which is the proper institution to reply to your question.
You should to the same with the German pension authority. I would first wait for the reply from HR/PMO, and then forward it to the national institution together with your question. In most EU countries there is a special administrative law provision that allows you to ask for a legally binding reply. If you have then acted in accordance with the state institution’s response, but the institution’s interpretation turns out to be faulty, you can claim reparations from the institution. I’m certain German law has this, so please ask a person who’s better versed in German administrative law.
Dear Ben,
I am Dutch and have been working in The Hague under the EU Commission for 6 years and have built up an EU Comm Pension over these years.
I am in the process to have my EU Comm. Pension transferred out but
I was informed by my Pension provider that once finalized the monthly payments that I will receive could be taxed with 19, 37 or even 49% depending on my personal situation.
Now here is my question on which I have not been able to get an answer until now:
I seem to remember, but I am not 100% sure of this, that the contributions that I made to the EU Comm. Pension fund on a monthly basis were already taxed and there for would be exempt from additional taxes ones used for a monthly pension.
Do you know if this is correct or not?
Thanks in advance and kind regards,
Max Schmits
Hi! Indeed, according to EU law, the pensions should not be taxed just like your EU income. However, there are a number of EU Member States that tax not only pensions, but also try to tax salaries of staff of EU institutions.
I can suggest several courses of action if you really decide to transfer out (i.e., you’re certain that you won’t collect additional 4 years in institutions to get the EU pension):
* transfer the funds to a 3rd tier pension fund in a different EU member state where you are certain that the payouts are not taxed.
* try to find a group of your nationals that have the same problem and consider litigate together. Here AIACE, the former EU civil servants’ union, could be of help with contacts and possibly also advice.
If possible, please let me know what action you decide to take and how it plays out! Also – consider joining our new Facebook group (https://www.facebook.com/groups/jobs.in.eu.institutions). While it’s small, it has a health growth and there might be people in a similar situation who can share their info and expertise.
Hi!
Apologies if I am misunderstanding your situation.
I thought that, when you transfer out your EU contributions (say, 40k euros) into a national scheme, then the pension you receive from the national scheme in question is taxed according to national tax rules and rates (so, perhaps even as high as 49%, depending on your other sources of income, e.g. if you’re still working after pension age).
In other words, since you’re receiving the pension from the national scheme and not from the EU, the exemption from national tax rules which applies to EU pensions (after 10 years) is not applicable in your case. It is a national (Dutch) pension – not an EU pension.
That’s my understanding – but I may be wrong.
Dear Ben,
I already bothered you on the forum on unemploymen benefits, and since your answer was extremely clear here I am again, and always thanks for the patience!
My question in three parts:
1- just to be extra sure: having worked only 6 years for the EC they cannot force me to transfer out my pension rights, correct? At least, for as long as I am not old enough to retire..
2- I think I read in one of the answers that when you reach a certzain age (55 or 58, not sure..) you can ask the PMO for the whole lump sum corresponding to your pension rights from the EC, is this true?
3- I heard a lot of rumours about a time limit for the transfer out depending on the country: for example, according to the trade unionist at my last Ec working place, in the case of Portugal you only have six months after end of contract! Do you know anything about this type of country-dependant time limit, particularly in the case of Belgium?
Thank you so much, there should be a statue of you in Berlaymont…
1. I’ve heard many stories about colleagues being “forced” to ‘transfer out’. However, I’m not aware of any legal basis that would allow forcing people to leave the EU pension system. I personally would just ignore such requests if I had a plan to collect the minimum 10 years of employment in EU institutions or wasn’t sure that a 3rd tier private pension fund would to a better job than PMO.
2. One can access the pension capital at the age of 55 if you have ‘transferred out’ your pension capital to a private third tier pension fund. If your pension capital is still with the PMO, then it’s my understanding that you can only request an early retirement from age 58 and a correspondingly decreased pension for each year of early retirement before age 66.
3. I’ve attended several PMO pension seminars. It’s always shared there that transferring out can be done at any time until reaching the pension age.If something has changed, it’s a very recent change in this case.
Dear Ben,
referring to the staff regulation
“He shall, however, be entitled to such pension irrespective of length of service, if he is over pensionable age,”
I have 3 questions please:
Is pensionable considered to be the 58th or 66th year of age?
Is the minimum pension then increased in case that you transfer-in (I have 10 years from Germany which I could transfer in).
And without any transfer-in, which is the amount of minimum pension, given that you have not completed the 10 years of service in the Institutions?
Thank you
Hi Ben,
is there a disability/invalidity pension scheme for those who have to drop out due to permanent illness?
Hi Ben,
Please help me to find out where could I get exact information about how much I accumulated in my “pension account”. I worked for 3,5 years at the European Parliament’s Secretariat in Luxembourg as Contract agent and Temporary agent on various positions. As I get it correctly, I can withdraw the whole amount, or transfer it to my national pension scheme when I reach retirement age. Thanks, Gabriel
Gabriel, hi! You should write to either your last institution’s HR department, or straight to the PMO Luxembourg office. The following contact details should work: PMO-RCAM-LUX-RDV@ec.europa.eu or + 352 4301 36100 +32 2 29 11111. The phone working hours are usually very short so try in the morning from 9:30 to 12:00. Hope this helps!
Hi Ben, thanks for your really helpful website.
I have a question regarding the survivor’s pension and hope you can help.
Does a survivor receive 60% of their spouse’s EU pension when they themselves already receive a state pension?
As far as I’m aware, the answer should be a “yes”. If you have earned the pension rights, there’s no reason for them to go away because of a parallel entitlement.
However, it’s safest to enquire with the PMO or your institution’s HR.
From your article: The accumulated pension amount accrues compound interest at a rate of 2.9% per year (in 2021).
Can somebody explain to me how this compund interest will affect my pension when I worked for the institutions 10 years and I will get only the fixed minimum pension?
Hi Ben, will a child of unmarried parents get orphans pension from. Say an eu retiree who has a child but was not married to thw childs mother. Will such child be entitled to orphans pension?
Hi! Entitlement to child-related allowances and benefits is not linked to parent’s civil status, but paternity/maternity. Hence the answer is yes.
Deal Ben,
I worked in a management position for several years but then moved to a non-management (adviser) position a few years before retirement. Do I lose the management allowance completely for the calculation of my pension of is is taken into account on a pro rata basis?
Thank you
Stefan
Hi! This would be a question to your institution’s HR or the PMO. I believe PMO only takes the basic salary into account when calculating the pension amount, but I might be wrong.
If you enquire with HR/PMO, please let us know what was the response.
I think I should establish a Facebook group, where it would be easier to have discussions on questions like this.
Hi Ben,
I would like to know if you can still perform paid work after retiring. Could the amount paid be deducted from your pension?
Best regards,
Maria
There are plenty of officials who have retired (and receive a pension from the EU) and continue working. One example for all – the former Secretary General of the Commission:
https://www.arnoldporter.com/en/people/i/italianer-alexander
(you are still required to comply with the staff regulations, e.g. on conflict of interest)
Thank you so much Max!
Thanks for this article. Is it incompatible to receive the EU pension and another pension as well?
If you have qualified, you can receive a pension from another source in parallel to the EU pension. While it is not encouraged by the EU, some staff continue to pay national pension contributions during their period of EU employment to also get national pension entitlement. This probably makes most sense if you have 10 or less years remaining to qualify for a national pension. Also – there is nothing to prohibit you from taking part in the so-called 3rd pension tier funds, where you make a fixed payment every month and then it gets invested on your behalf.
I would be much obliged if you could advise whether former contract employees of European Union Missions in Kosovo, Bosnia or Somalia are entitled to pensions where they were in continuous employment for years in some cases over 8 years.
Apologies, but I know very little about EU missions. Could you please contact the mission’s HR or the Paymasters Office, PMO?
Dear Ben,
you write in your article: The accumulated pension amount accrues compound interest at a rate of 2.9% per year (in 2021).
How does this actually affect my EU pension? Because you write in other parts of article that: your pension will be calculated based on the last basic salary you received.
Is there any extra amount added to my monthly pension then?
Thank you
Once you start to receive your pension, it is indexed at least once a year, usually, in December. You might then get a retroactive extra payment due to inflation (and there is the theoretical possibility of a deduction from a pension due to deflation).
Hello Ben
Thanks for the article, amazing!
I get that once pension is taken early, say at 58, it stays at the level and there is no ‘jump’ at the normal retirement age of 66.
Would you know though if the pension, once in receipt, is adjusted in line with an inflation index? Or alternatively, if the 2.9% compounding mechanism applies to the pension also when a person is already retired? I would imagine that there is an inflation protecting mechanism but thought I would confirm.
Thanks again for the great content!
Maciej
Hello Maciej,
I don’t work for the European commission, never have, probably never will. However as dealing with my parents divorce and associated alimony, my father (who worked for the European commission) I’ve had to contact the PMO to sort out pension, alimony and indexation.
I’ve had it confirmed to me in writing that:
“We do not pay an indexation according to the national increases. The indexation for both active and retired staff takes place every December with a retroactive payment to July of the same year.”
It has also been confirmed to me that been confirmed to me that this refers to “the indexation of people receiving a retirement, survival or invalidity pension from the EU institutions.”
Hope that answers the indexation question for you. For the 2.9% i can’t assist however.
Kind regards,
Martin
As Martin replied, pensions are indexed. However, this is a specific EU institutions process that usually lags behind actual national inflation/deflation statistics.
Hi Ben,
Thank you for your very informative article. Do you know whether the years someone works part-time (80% or 90%) while still paying 100%/full-time pension contributions count as full years of service, i.e. towards the 10 year minimum after which a pension can be claimed?
Many thanks,
Michael
I’ve just got an answer to this from the Pensions Department in the EU institution I work in. The answer is ‘yes’. I thought it would be but preferred to ask a possibly silly question than to discover later that I’d have to work a few extra years!
Thanks again for you excellent site and for the advice you provide.
Thanks so much for taking the time to share the PMO reply!
Dear Ben,
Your article is greatly helpful and informative. I thank you for your personal effort and time invested. I have a few questions about my future pension rights with the EC, questions that may be interesting to other readers as well.
1)I am currently 46, married, with 1 child of 2 years, so I currently receive the household allowance and the dependent child allowance. In 3 years, I will have 10 years of service as EC official (contract agent).
Does this mean, if I stop working with the EC after having the 10 years pension right, that I can request to receive at the age of 58 the pension monthly amount of 1200.24 minus 28% = 864 euros, plus household allowance (if still married at that age) plus dependent child allowance (provided that the child’s age permits so)?
2) If I leave the EC after a total of 10 years of service, and I don’t transfer out my EC pension right, will this affect my national pension scheme? ie. If, at the age of pension in Greece, I don’t have enough pension years (if the EC years are not to be taken into account, since I won’t transfer them out (to Greek pension scheme), does this mean that I might not be eligible for a national pension?
I hope I have been clear. I am a bit confused on how the EC pension and the national pension work together.
Thank you very much in advance. Take care.
Hi!
1) Yes. That is also how I understand the rules. That’s the pension amount, you will keep on getting the child allowance. You will also entitled to the education allowance if applicable (covers also university studies at double rate). Once you retire, your spouse and dependents also get JSIS coverage. Bear in mind that the pension amount will not increase as you age, it will stay at the early retirement amount (which really sucks).
2) If do not transfer out, of course, you will not get additional rights in the national pension system. The best thing to do, once pension nears, ask for a precise calculation from PMO and the national system. You can also transfer in national pension rights, but they are not counted in years, but in financial capital.
If this is relevant, ask your HR when is the nearest PMO pension rights webinar. Those are really good and you can follow-up with questions to PMO colleauges after the webinar.
Thank very much you Ben! Be well.
Hi Ben thanks for the info.
One more explanation needed: if we worked in an EU member state before joining the EU Institutions but we did not reach the minimum period requested in some MS (like in Germany is 5 years), but we did not want to transfer IN the EU scheme this previous contribution, it was said by PMO that the pension authority of that MS has to take into account years worked in the EU institutions to reach the minimum period and pay a pension pro-rata. Do you have any further information/evidence about this? thanks in advance
Sorry, this is too specific, you would have to ask PMO or the national institution.
Hello Ben,
you are very clear.
I have only one doubt and I hope you can clear it up for me: in a few days I will go to work in Brussels (moving from Spain). When I will be eligible for the right to a pension, would my expatriation allowance and family allowance be paid to me together with the minimum pension of 1200 euros, although my residence remains in Belgium?
Thank you!
Household allowance seizes to be paid. You will continue to receive dependend child allowance if you children are in your care. If they atttend a for-a-fee school or university, you will continue to receive the education allowance until they graduate or reach the statutory age when the allowance stops.
Hi! Thanks for your articles – very useful!
A question regarding the 10 years necessary to qualify for a EU pension – does CCP count to that effect?
Say, a person who has worked for 6 years in an EU institution and then went on CCP for 4 years – is she entitled to the pension (albeit to an amount corresponding to her last salary in the EU institution)?
Thanks!
Could you please clarify what does CCP mean? I think it was one of the EU’s special missions to third countries, but am not completely sure about this.
If that’s what you mean, another reader recently pointed out that it really depends on the contract. Staff of CCP missions usually are not statutory staff of EU institutions, and hense this work experience doesn not count towards 10 minimum years to qualify for an EU pension. However, looking forward to your clarification and also info about what type of contract you had.
Sorry, CCP is the french acronym for “Leave on personal grounds” – art. 40 of the Staff regulations. I was an administrator (AD).
Hello Ben and Francisco,
I’m taking the liberty to jump in here as I looked into taking a “Leave on personal grounds” recently to follow my spouse and was interested in maintaining my pension contribution at that time. I had read that TAs could pay upfront their pension contributions themselves for the duration of the CCP. However, that only applies to certain type of TA contracts TA of 2C type and 2d (I discovered on this occasion that there were different TA contract types). For my type of contract TA 2f, this is not an option unfortunately. Here is the written reply I received from DG HR:
‘It is possible for a TA2f on unpaid leave to continue to contribute to the sickness and accident insurance schemes only if they are not working or are working but cannot be covered under any other scheme.
It is not possible for a TA2f to acquire pension rights during a period of unpaid leave.’
Hi,
I just have a basic question. As an EU Commission official I have my pension rights secured after 10 years and calulated as explained above.
Now, according to the treaties the salaries of EU officials are not subject to national taxes. What about the pension? Is taxed according to the rules of the country of residence of the retired official?
Thank you
Dear Filo,
Same community tax principle applies for the pensions so not according to the country of residence.
However the country where you will take your retirement residence has an influence on your pension coëfficient and thus can in- or decrease with the same level of rights accordingly the final amount.
As far as I’m aware, the correction coefficient is not applied to pensions. You get the 100% Brussels amount irrespective of where you choose to retire. This can also be a third country.
Pensions are also not taxed in the home country. EU countries are generally aware of this. If you run into issues, you must contact PMO and ask for assistance. Issues appear to pop up from time to time, but these most often individual cases related to banks, overzealous state institutions staff etc.
Dear Ben, my wife has been working for the Commission for the last 17 years as a temporary agent. We are getting a divorce and as a spouse I need information about my pension rights and also my JSIS coverage. I don’t have access to the system and I don’t know who to contact. I am sure there are many spouses that have the same problem. I would really appreciate your help.
Dear Tobias,
Unfortunate to read what you are going through. Although it is a general answer I am giving here; I am afraid that you are not entitled for any pension right as its entitlements are linked to the person who worked for the Institution. The JSIS coverage (full/complementary) will cease to exist in the end too.
In such case you will have to check / enroll with the (un)employment/social wealthfare office of the country you reside in.
If you believe you have a particular case or for a more accurate info, try the contact details you find here in the link below:
PMO – Rights, salaries and allowances:
https://ec.europa.eu/pmo/guide/rights-and-allowances.html
JSIS – Welcome Desk/Hotline:
https://ec.europa.eu/pmo/guide/jsis-request-of-information.html
Erik, thanks so much for helping to answer to questions! ❤️
Tobias, hi! If you divorce, you are most likely using the rigths to the survivor’s pension and also JSIS coverage when you retired as the spouse of a retired EU official.
If you want to have official information, you must write a letter to PMO, the Paymaster’s Office of the European Commission. You will find contacts of the relevant unit here: https://ec.europa.eu/pmo/
Dear Ben,
Thank you so much for the effort in collecting all this info in one article! It is much appreciated.
I would like to ask you a question that arises from the wording you are using in the text. More specifically, you mention: “The mandatory pension age is 66, at which you qualify for a full EU pension”. When you write “full pension”, do you mean 70% of your last basic salary, or the pension corresponding to (number of years worked) X 1.8%?
I hope you will find the time to respond but, regardless, thanks a lot for all the info provided 🙂
Cheers,
Nikos
Nikos, thanks for the question. I meant “the pension corresponding to (number of years worked) X 1.8%”. Will try to specify this more clearly in the text.
Sorry about delay in replying, lots of work lately.
Hi Ben
I am a temporary agent with 8 years contemplating resigning and leaving the institutions for good. I’ve roughly worked out a transfer value of approx €200k capital value. I’m in my early 40s.
It’s unlikely that I’ll ever work in in an EU institution again to make up the ten years so I’m considering a “transfer out” to a private pension scheme in an EU member state when I resign.
Assuming that all of the guarantees in the CEOS are satisfied, what kind of product does the Commission allow me to make the transfer to? Ideally I’d like to put it all into equities with very low fees and start to draw down in twenty years or so at my own pace. I don’t want to be forced to buy an annuity-type product for a payout in 20-odd years as I think this would produce a much lower return and I’m happy to take the risk with equities.
Thanks
Leaving Brussels
Hi! I suggest you stil try to attend one of the seminars organized by PMO about transferring out of pension rights. There are organized regularly.
You can also write to PMO. It’s best to do it through the form on Intranet as then you are identified and find out your precise accumulated capital amount, etc. You can also send an email PMO-TFTOUT-ALLDEP-DEMANDES@ec.europa.eu, if you just want to find out info about a general question.
Last time I attended such a seminar, PMO informed that there is a list of approved 3rd tier pension funds in each EU member state (I wasn’t able to find the list in public sources). You select the fund and its product that appeals to you, and instruct PMO to transfer funds there. You do not always have to transfer to your own country if ther services don’t satisfy you but there were additional rules if you wanted to use a fund in another EU country.
If you find out more, would be great if you could drop me a line so I can add info to this post.
P.S. This is what the form to request the transfer out look like (public source), but you’ll be provided by PMO with this anyway: https://ec.europa.eu/pmo/decl_tft_out_en.pdf
Hi Ben,
Really great post and thread – thanks so much!
I’m a little confused by a few post though (I’m sure it’s just me) so wonder if you can clarify, if you get a chance.
I will shortly be joining an EU agency on a TA contract. The duration is for 5 years but I would hope it will be renewed. I have 3 years of a private pension scheme and a further 11 years of another private pension scheme in an EU member state. I don’t have the current value of these to hand.
My main question is regarding whether I can transfer these into the EU system when I start? Would they be recognised and transferred into “years”? I understand they will be converted into comparable years – ie 100k might be calculated as 3 years 2 months etc etc.
Have you any guidance on how to calculate what the “fund” might be worth in years?
Also, I have a significant number of “state pension” years built up too. Is it possible to transfer this in and forego my state pension for those years in my hole country – i.e from 17 to 38 years of age?
I believe some of these questions have been asked above but can’t quite differentiate between the answers.
Thanks again for all your input here, really really useful
Hi, Max. Congrats on landing the job! Be sure to read about other allowances and enjoy JSIS coverage for you and the family!
I will try to summarize the article.
First, as soon as you’re hired, inquire with HR about PMO (Paymaster’s Office) trainings on the “Transfer-in of pensions”. This will answer your questions in detail. There’s even the option to submit questions and trainers will prepare in-depth replies afterwards.
That’s correct – you don’t get to transfer-in years from national pension systems, but the pension capital which is then “equalized” to your contributions from employment at an EU institution. Unless you’re coming from a very wealthy country, most likely, your many years on the national level will transform to fewer years in the EU institutions pension system.
Unfortunately, only PMO could advise you on how many years you might get when transferring-in.
N.B. Please also read the comment of Anja, 2 November 2021 at 15:11, below.
I hope this was useful!
Dear Ben,
I work currently for EULEX (in Kosovo) and I would like to know if it’s possible to apply for the EU Pension Fund.
Thank you for the useful information. Where can i find the list of the European Commission-approved pension management schemes in all EU member states. I am specifically looking for the pension management schemes in Spain. Thanks a lot for your help.
I remember from a training, that the PMO has this information. If you cannot find this yourself, please call them or write a message (you’ll have to log into an EU system; I couldn’t find a public email): https://ec.europa.eu/pmo/guide/jsis-request-access.html
Hi Ben,
I am nearing retirement and will retire to the UK.
Many years ago I worked 9 years ( duuurgh!!! ) for the EC as a contract agent. I was forced to transfer out my pension. I was given a list of schemes – only 2 were related to the UK and were ‘offshore’. I went with a company in Brussels and received something called ‘Deffered Annuity with Transfer of Benefits’ which will give me an annuity on retirement.
My question is, will this be taxable in Belgium – I don’t see why because the money wasn’t generated in Belgium – but I know nothing of these matters.
First of all, sorry you could not collect the extra 1 year to qualify for the EU pension!
As anything related to pensions is near to arcane magical runes, for this reason I’ll avoid even guessing an answer. It’s also clear that in this case you cannot address PMO, the EU Paymaster’s office.
This totally is a question to your pension fund. Even if they won’t know the answer right away, they are best qualified to provide one as they are located in Belgium and will have access to your case files. Best of luck!
Hi Ben,
Thank you for the information that you post in this web page, and for answering our questions.
According to Article 9 of Annex VIII of the Staff Regulations, “An official leaving the service before reaching pensionable age may request that his retirement pension: (A) be deferred until the first day of the calendar month following that in which he reaches pensionable age; or (B) be paid immediately, provided that he is not less than 58 years of age. In that case, the retirement pension shall be reduced by an amount calculated by reference to the official’s age when he starts to draw his pension”
I just want to clarify something that is not clear in the wording of that article: what happens when the official leaves the service before reaching pensionable age and before he is 58 years of age? Is he then forced to go for option A (deferred pension), or can he still leave the service and when he becomes 58 request option B (early retirement)?
Hi! Sorry for the delayed reply, I unfortunatelly missed your comment/question.
If you have accumulated 10 years in the EU system and have not transferred out your pension capital, you can leave EU institutions and then claim your pension starting from the age of 58.
Hi, as a fired contractor of external company (but work for EC) – do I have some rights to these benefits? I worked (and was allowed to) work remotely from other country and was fired unexpectedly. Do I have any rights? As I know there are much more people like me. Thank You!
Alef, I cannot provide a definitive answer, but from cases similar to yours I’ve gathered that you are not counted as a contractual staff member of any EU institution. Your contractual relationship is only with the company that hired and paid you (even though it was from monies received from the European Commission). I haven’t researched this, but I would look whether maybe there is a labour union that unites employees like you. That might be best placed to provide legal advice to you and also have relevant negotiation and litigation experience.
If you can’t find one, you can always try to approach the labor inspectorate, labor board or an institution of a similar name in the country where your employer was incorporated to receive a consultation about your rights and possibly even further assistance.
Hey there. I am currently ina screening process for an AD7 position in Belgium and I am a Belgian national with 1 daughter. Looking at your explanations, it’s at the same time clear and confusing.
You say that it’s very interesting from a tax perspective as there is no national tax. Approximately it is around 40-45% in Belgium between gross and net salary. Currently I make a bit more in gross per month than the step 1 for AD7 and was trying to compare.
Looking at different taxes you indicate here, it doesn’t seem to be tax free/low tax as it is generally adversited. I see there is a Social security tax (around 12%) , solidarity levy (6%) and EU income tax 8-45%. That brings in total to either 25ish% for lower salaries and (18+45) over 60% tax for higher salaries. Is this how we should understand this ? Because this confuses me as the difference with national taxes is not that different taking into account that I would be granted no expat allowance, no 13 month salary etc. When compared to some private company with a similar position, income and social taxes In Belgium are indeed 40-45%, but largely compensated by the 13 month, company car with fuel card, solid additional group insurance, lunch vouchers and solid group insurance and pension plan, yearly bonuses etc.
So from a pure revenue perspective, even though it is advertised as being tax free or very low taxes while working at EU, globally it’s not that interesting in fact.
Is my reasoning correct ? I may need to consider looking twice before making the move.
Thanks for your reply.
Hi! Apologies for only now replying to you! This is a hobby so I’m at times not able to respond to comments in a timely enough fashion for you and my other readers.
I’ve recently posted articles on the approximate net salaries of the various types of contracts and grades, including AD7, posted here: https://euemployment.eu/administrators-ad7-salary/. The figures should be 90-95% correct, giving you a possibility to compare your income in the Commission vs a private sector employer.
I hope that this article helps you to make decision whether to take the European Commission’s offer.
In case you are considering taking an offer in another EU member state, always remember about the impact of the Correction Coefficient. But this is not a worry if you’re seeking employment in Brussels or Luxembourg.
Dear Ben,
Thank you for all these information that are very useful.
If I was working 15 years in EU institutions as contractual / temporary agent in FG 1 and FG II group with the basic salary always less then AST 1, what would be my pension at the age 66?
1200€ (because my basic salary was always less then AST1 or 1.5x 0,04x AST1, which gives 1800€.
In previous posts i found some calculations for AD 5, AD 10 but not for the contractual/ temporary agents who were working for lower wages.
What if one reaches pension age before accumulating 10 years of service? (E.g. someone who starts working for an eu institution or agency at 58). Such a person would have accumulated pension rights in a national scheme (having worked in their native country before taking up a job for the EU). Could they transfer their national pension rights to the EU scheme? Or would it be wiser for them to keep paying contributions to the national scheme to get a national pension, beause they will not be able to get any kind of EU pension with less than 10 years of service?
Hi Anna,
Did you receive an answer to your question about reaching the pension age before accumulating 10 years of service? In the case of starting working at 58).
Hi, Ana! No, unfortunately I haven’t… I am still interested if anyone has an answer to my question!
Hello!
I think that Article 77 of the Staff Regulations is what you need in your case: “An official who has completed at least ten year’s service shall be entitled to a retirement pension. He shall, however, be entitled to such pension, irrespective of length of service, if he is over pensionable age, if it has not been possible to reinstate him during a period of non-active status or in the event of retirement in the interests of the service.”
The way I read it – you will qualify for an EU pension when you reach pensionable age (66 years), even if you start working for the EU at 58. In other words, in that case, you’ll get a pension even if you have not fulfilled the ordinary requirement – which is 10 years of service.
Another thing to keep in mind is the amount you will receive – it may be the case that you will only receive the minimum amount which is linked to the salary of AST1 grade.
Please note that this is just how I read the staff regulations, i.e. my personal view. I stand to be corrected.
Max, thanks for the reply. This is how I also understand the rules, but there might some caveats we are not aware off. It would be best to enquire with the institution’s HR and/or PMO. This is a normal question, and you’ll not be penalized for asking it. If possible, please share back here if you are indeed entitled.
Dear Ben,
All the information you are giving is very useful and interesting. However, I think you should point out whether the “2014 Staff Regulations” apply or not. For those who became officials before 2014 the previous Staff Regulations apply with more advantageous terms. For example they can retire at 65 years and not 66 and the percentage of the final basic salary for each year can be higher (around 1,90-2,00%). Also please note that even if one was a contract agent before 2014, but became an official in 2014 then the “2014 Staff Regulation rules” apply which are a bit more disadvantageous compared to the previous ones. At least the above is what I was told by HR… Thanks and regards, Anna
Hi Kepa,
If you accrued 44% pension rights of your last salary and you retire at 58 you would get X (last basic salary) times 44% = Y – (times 28%) = Z example 8000 x 0.44 = 3520 x (1- 0.28) = 2534
Dear Ben
Your example above suggests that the option is between a minimum pension of 10 * 0.04 * 3000.59 = 1200.24 or a standard pension of years worked * 1.8 * final salary. The minimum pension is years worked * 0.04 * 3000.59, up to a total of 70% of final salary. So for your example figures:
EUR 4883 final basic monthly salary.
70% of 4883 = 3418.10
10 years: EUR 4883 * 1.8% * 10 years = EUR 878.94. Minimum pension of EUR 3000.59 * 4% * 10 years = EUR 1200.24. End result = minimum pension, EUR 1200.24.
20 years: EUR 4883 * 1.8% * 20 years = EUR 1757.88. Minimum pension of EUR 3000.59 * 4% * 20 years = EUR 2400.47. End result = minimum pension, EUR 2400.47.
30 years: EUR 4883 * 1.8% * 30 years = EUR 2636.82. Minimum pension of EUR 3000.59 * 4% * 30 years = EUR 3600.70. End result = minimum pension, EUR 3418.10 (due to 70% cap).
40 years: EUR 4883 * 1.8% * 40 years = EUR 3515.76 (EUR 3418.10 due to 70% cap). Minimum pension of EUR 3000.59 * 4% * 40 years = EUR 4800.94. End result = either, EUR 3418.10 (due to 70% cap).
Now calculating as AD10 step 1, final basic salary 8064.86
70% cap = 5645.40
10 years: EUR 8064.86 * 1.8% * 10 years = EUR 1451.67. Minimum pension = EUR 1200.24 (calculation unchanged). End result = standard pension, EUR 1451.67.
20 years: EUR 8064.86 * 1.8% * 20 years = EUR 2903.34. Minimum pension = EUR 2400.47. End result = standard pension, EUR 2903.34.
30 years: EUR 8064.86 * 1.8% * 30 years = EUR 4355.02. Minimum pension = EUR 3600.70. End result = standard pension, EUR 4355.02.
40 years: EUR 8064.86 * 1.8% * 40 years = EUR 5806.69 (EUR 5645.40 due to 70% cap). Minimum pension = EUR 4800.94. End result = standard pension, EUR 5645.40 (due to 70% cap).
Dear Ben,
If someone retires at AD7 after 10 years in an EU institution and gets the minimum pension on account of having only done 10 years and having retired several years before the normal retirement age, are they entitled to any cash sum in addition to the minimum pension amount, given that their contributions will have been higher than those of some other people who would be entitled to the minimum amount?
Many thanks,
Michael
Dear Ben,
I am a former European official who worked as a temporary agent at the EU Court of Justice for about 3 years. At the end of the contract, in 2013, I received a notification from the CJEU by which I was informed that by virtue of art. 11, 1 and 12, 1(b) of Annex VIII to Staff Regulations, I have the right to transfer the related pension rights to a pension fund/system of my choice.
I am currently 62 years old and, so far, I have not yet requested the transfer of pension rights to a pension fund/system of my country of origin.
I would like, if I may, to ask two questions:
I. The first question refers to the significance of art. 12, 1 of Annex VIII to Staff Regulations.
According to this provision:
“1. An official aged less than 63 years whose service terminates otherwise than by reason of death or invalidity and who is not entitled to an immediate or deferred retirement pension shall be entitled on leaving the service:
(a) where he has completed less than one year’s service and has not made use of the arrangement laid down in Article 11(2), to payment of a severance grant equal to three times the amounts withheld from his basic salary in respect of his pension contributions, after deduction of any amounts paid under Articles 42 and 112 of the Conditions of Employment of other servants;
(b) in other cases, to the benefits provided under Article 11(1) or to the payment of the actuarial equivalent of such benefits to a private insurance company or pension fund of their choice, on condition such company or fund guarantees that:
(i) the capital will not be repaid;
(ii) a monthly income will be paid from age 60 at the earliest, and age 65 at the latest;
(iii) provisions are included for reversion or survivors’ pensions;
(iv) transfer to another insurance company or other fund will be authorised only if such fund fulfils the conditions laid down in points (i), (ii) and (iii)”.
The phrase, “An official aged less than 63 years (…) shall be entitled on leaving the service (…)” means that I have to transfer the pension rights acquired during the period I worked at the CJEU, until reaching the age of 63, or I have this right even after reaching the age concerned?
II. The second question concerns the EU institution competent to receive the request for transfer of pension rights
As I said, the notification on the transfer of my pension rights was issued by the institution I worked for, the CJEU. I understand that now the request must be addressed to the Commission’s services (PMO).
Could you please tell me if there is a specific service within the PMO that deals with receiving transfer requests, which can be consulted on the concrete procedure to follow? And what would be the contact details of this service?
Kind regards,
Ion
I’m in the same situation. Same age and worked 3,5 for 3,5 years. Do you have some news about the procedure? How it works and where we could find relevant informations?
Hi Ben. If I worked for 1 year in EU CSDP mission as a seconded expert.
Is that experience will also be included in the 10 years service?
Thanks, cheers.
Hello,
no, this experience will not be included in 10 years service, as the CSDP Missions are not qualified as EU Institutions. Therefore, mission members don’t have a status of EU civil servants.
Only persons who had the status: Permanent Officials, Temporary Agents, Contract Agents can accumulate their years of professional experience for retirement purposes.
Maya, thanks a lot for the reply. I know near to nothing about CSDP missions, so it’s very helpful you could chip in!
Hi Ben,
you answered to the question ”I have also read that early retirement pension amount is reduced 3,5% for every year before mandatory pension age of 66.
Is this reduction of 3.5% aplicable to the minum of 1200.2 as well?”
with your post
(Ben says: January 10, 2022 at 11:19
That’s a great question, to which I at the moment don’t know the answer about. When I’ll find out, I’ll update the article.)
Have you clarify that question now? Indeed I remember that during a PMO training back in 2019, it was said that the 1200,2 EUR minimum was not reduced by 3,5% annually in case of early retirement between 58 and 66. But maybe I remember incorrectly… Thank you.
“ He shall, however, be entitled to such pension irrespective of length of service, if he is over pensionable age,”
I will have 11 years of service at the age of 61. Does the above provision mean that even if I am entitled to an EU pension ( min 10 yrs of service), I have to wait to request my retirement until the age of 66? But then I would be out of the EU system. Or can I request the minimum EU pension ( the subsistence) at the age of 61 and 11 yrs of service?
Corine, if you have 10 years in the EU system, you can request an early retirement from the age of 58. However, there is a permanent deduction for each year before age 66.
To find out the size of your pension and related rules, it would be best to ask your institution’s HR or directly to PMO! Consider to also attend one of the PMO seminars about pension rights offered to staff of EU institutions.
Hi Ben, I have a child with someone who retired from the European commission but he passed away before we could get married, is my child entitled to child support from the European Commission?
If so, what would my child get.
Thanks.
I’m no expert in this, so please doublecheck, but a child’s entitlement to the survivor’s pension and maybe also JSIS coverage should not depend on the parents’ marital status. The only thing that matters should be whether paternity/maternity is recognized (I assume this case is about paternity).
The best course of action would be to get in touch in writing with HR of the institution your partner used to work for, or with PMO in Brussels. They will advise you on any missing documents, and if some payments have been missed, the child should get these in one payment for all of the past period.
Hello, my pensionable age is 62 and 8 months but I will reach 70% pension rights at the age of 61 and 6 months. Moreover I have a transfer of 14 months pension rights from previous job. With the malus for ”Early leaving” half of this transfer is lost and I m penalised despite I Will have worked the number of years requested. Any suggestion for this discriminatory situation for staff hired at young age ? Thanks a lot
Thank you for pointing out one more problematic issue with COM HR rules. My best suggestion would be to get in touch with AIACE, the association of retired EU civil servants and see whether this could be brought before the Court of Justice of the EU. If the case is succesful, you could benefit from a ruling still within your lifetime.
Lenght of service. Sorry but there is a mistake in the percentage reached after 30 and 40 years of service. 30 y x 1,8% is 54 and 40 x 1,8 makes 72. Moreover the maximum pension rights you can get is 70. Have a nice day
Thank you for pointing out my arithmetical mistake, very much appreciated. I’ve now corrected the article.
Hello,
I’ve accepted a job with EC. I am 49 and I have already cumulated 25 working years. If I work for the EC until 64, I will reach 40 years of career, which, in the country I lived now, would allow me to retire with a special option for women. If at 64 I resign from EC and come back to my country and go to pension according to this rule, will I receive also the EC pension? or should I wait 66 years or the EC pension will be reduced (as explain in the article)?
Thank you.
Hi! The EC does not have favorable conditions to women. The retirement age is the same for men and women – 66. However, you can choose early retirement, as you would have accumulated 10 years of EU service already by the time you turn 59. However, each year of early retirement permanently decreases the pension you are entitled to.
Another option is to “transfer out” your EU pension at 64 to the national pension scheme (I assume to Italy). In this case your national pension institution would do a calculation of your final pension, taking into account the years worked for the EU and/or the accumulated pension capital in EU system.
The EC Paymaster’s Office always recommends to write a written request a year of less before you plan to retire to them to find out which option (transfer-in, transfer-out, or trying to receive both the EU and the national pension) is better for you based on real numbers.
Dear Ben,
I came across all the information you have provided on the EUEA website regarding EU pensions. I read that to find out more on “transfer in” procedures, one should join a PMO training session. I am external so will try to see how to join- thanks.
However, in the mean time, I was wondering if you could share your views on my scenario below- I have worked in the EU as follows:
• Sep 2001- Dec 2006 in the United Kingdom – am qualified for a UK pension as I am still contributing each year for the shortfall and will continue to do so until 2037 (when I turn 67) at which point I will be entitled to a full UK pension
• April 2007 – to date (roughly 12 years) in Belgium paying full BE taxes
My question is, if I join an EU institution say next year in 2023 (I will be 53 years old at that point) and work for the next 10 years for example as a FG IV Grade 16/17 until 63 years old, would the “transfer in” from both BE (and possibly the UK) work to my advantage?
Is there a quota system where my full contribution in the UK and my 12 years in BE are equivalent to certain amounts of EU years? Meaning, are the contributions increased or decreased in comparison to EU pension years?
Lastly, besides the fact that the EU pension and “transfer in” amounts would be tax free and there would be health insurance until death, is there anything else to consider?
Voila, am trying to decide if I should stay employed as an External and continue paying BE taxes until retirement or if now is the time to move and join the EU for the next 10 years of my career. My salary under BE taxes is equivalent to FG IV under EU remuneration so I do not need to change employers for the salary.
Many thanks for any advice or insights you may have to share with me.
Kind regards,
Simon
Dear Simon,
Thank you for the elaborate question. While I’m afraid I won’t be able to respond with the same level of detail as in your question, let me share what I can.
I’m not certain if you can join EU-learn courses as an External, but certainly worth a try. Usually this is managed by HR or an entity in charge of training.
In worst case scenario I’m certain you have colleagues among regular staff that can sign up and let you listen in.
I would seriously think about joining an institution as regular staff because even if you work for 10+ years, you will not be forced to take the EU pension. Until you decide to (not) take the EU pension, you are free to both “transfer in” and “transfer out”. This means that if you see that there’s a larger benefit of transferring out to the Belgian pension system, you will be able to do that. (I’m not sure you would be able to transfer out to the UK, however, that might be an option after Brexit considering the large number of UK nationals that were working for the EU.)
From what I’ve gathered the procedure for transfer in and out is similar. Before you make a decision, you can ask PMO to do a precise calculation based on your real contribution data. I guess you could do the same in BE and UK, to see which scenario makes sense.
Besides the pension and the JSIS coverage for you and partner there’s not much else… maybe the survivor’s pension for your spouse if you pass away first.
Personally for me the JSIS coverage seems to be really appealing as it’s the retirement age when I expect I’ll make most use of the healthcare services. 🙂
And how does it work, the other way around? If you want to transfer into eu pension system, any accumulated amount coming from a previous contribution to a private pension fund.
Is it possible ? I have just joined the commission as official and I have previously contributed to a private pension fund, and I am wondering if it is possible and worth to transfer it
Thanks
This question was already answered below. In short, you can “transfer-in” your pension capital, however, what counts is not the years of contributions, but the amount, which is then “equalized” to your contributions from the EU salary.
Hi Ben,
I left an EU agency with a 44% contribution at the time. I’m 49 now. If I want to get early retirement at the age of 58, will my pension be 44-28% = 16% or €1200 (whichever is the highest)?
Thank you.
Kepa
Dear Kepa,
Your calculation looks about right, however, the best thing would be to write to PMO and find out precisely. Their reply might take a while, but they would operate with actual data of your case.
If you decide to retire early and take the substantially decreased pension, two considerations: a) I’m not at all certain that you would get the minimum pension if you retire at 58.. I do not know whether it also does not get proportionally decreased; 2) It might make sense to “transfer out” all of your accumulated pension capital and invest it, for example, in real estate to rent it out. It might be that rental income is larger than the minimum pension. Here, again, information from the PMO might be very useful.
Hi Ben,
thank you for this. I have a question: what happens if over time my salary decreases? Take the case of someone who worked as a referendaire for 6/7 years at a AD10/11 salary and after they leave the Court they find a AD7/8 job with each the cross the ten year limit. Would they really receive 18% of the AD7/8 salary?
also for people working as referendaires or parliamentary assistants depending highly on their judge/MEP’s mandate, do they get unemployment benefits after the end of their boss’s mandate if they did not want to leave themselves?
thank you in advance!
Alex, hi! I now nothing of how the CJEU operates. I assume it might be similar to the European Commission, but there might be some differences considering the independent status of the institution.
Regarding the first question, PMO in one of their webinars said that pension is calculated proportionally to your average income. So it would be somewhere between AD10 and AD7.
As to the second question, please ask your institution’s HR.
dear madam, sir
I have worked for 7,5 years for the EU, I have received indeed the advice to transfer the funds to a third party pension fund; PMO says I will NEVER receive the pension capital accumulated and that I am obliged sooner or later to place it in a fund to receive monthly payments.
In several of the comments above I read however that I could receive the full amount in cash upon retiring not working for the commission? which is the correct statement?
further, some horrible info: to transfer the capital a fund asks 5000 transfer cost, and the broker ‘takes’ another 2,5 per cent. This broker has the ‘monopoly’ in Belgium and Luxemburg, which is not EU-like. Are people aware of this malicious practice?
So in case it would be possible to receive the funds as a whole, it would solve this particular issue. How to go about please
Dear Nic, let me try to answer what I can.
1) Transfer out of accumulated pension capital – I’ve heard of particularly colleagues in the European Commission to be receiving such “threat” letters. However, I know of no rule that would not allow you to leave your pension capital with PMO until shortly before retirement and only then to decide what to do with this. There is always the possibility that you return to an EU institution and get the missing 2.5 years to get an EU pension and JSIS coverage for your retirement.
2) Getting access to your pension capital – as far as I know, you can transfer it to a 3rd tier private pension fund any day. However, if you want to use the whole lump sum, I believe, you can withdraw it from the pension fund only upon reaching the age of 55. But I do not have a source for this, I think I heard it in one of PMO’s webinars on pensions. If important, please write to PMO to clarify.
3) Private pension fund fees – you allowed to transfer out to any EU Member State fund. If BE or LU funds charge exorbirtant fees, consider FR or other country. There is a full list of accredited pension funds somewhere on the Commission website.
Dear Ben, thank you for your log and apologies if this has been answered already.
If I move to a European Institution (one of the agencies) now at age 53 and IF I manage to stay over the 10 years mark ….can I bring over the 23 years already accrued for a State (PUBLIC) pension within one other Member State (Ireland), in order to get a better EU pension ?
If the answer is yes, who would be the Body responsible to address this issue to do the pertinent calculations when the right time comes…?
Thanks so much for the help in advance. Much appreciated. Kind regards
Gon
Dear Gon,
Yes, this is possible. However, you would not be able to transfer 23 years proportionally. To oversimplify, PMO, the EU Paymaster Office in charge of pensions of EU institutions, would look at your accumulated pension capital and equate it to your average pension contributions while working for the EU agency. If the contributions are sufficiently high, you could still get your 23 years, but it might also happen that you are credited with less than 23 years.
This practice is hugely problematic for EU officials coming from poorer EU MS, but might not be such a big issue for an Irish national.
I warmly suggest that once you start working for your agency, sign up for one of the regular training/info sessions organized by PMO on the “EU learn” platform (ask your HR about it). There you also get to ask questions to colleagues at PMO.
Once your retirement arrives, you can ask for PMO to do a calculation to see if the so-called “transfer in” of your Irish pension capital makes sense, or if you are better off by receiving both the EU and the Irish pensions.
Ben says:
February 28, 2022 at 11:54
To find out precise details, I warmly suggest to sing up for one of the many PMO seminars for EU institutions’ staff.
In short – yes, it’s possible. However, you can transfer the funds to a 3rd tier (private) pension fund in any EU MS that has an agreement with PMO. The funds will only become accessible to you when you turn 55. Then you can either take out the whole amount, or leave it at the fund in exchange for pension payments.
Hello Ben,
This is the first time ever I see a reference to getting the funds at 55. Cold you please expand on that? I have 8.x years, short of 10 and I am not sure I will ever be able to finalize those 10 years. Interjections aside, it wold make a big difference in my choice to know that I would have access to that capital at 55 and not at 65.
Thanks a lot.
F
Dear Ben,
I have another question maybe you can help me again.
In the case that I work for the EU less then 10 years, it’s possible to make a cash-out instead of a transfer out of my contribution to the EU pension scheme?
I mean, that I receive the whole amount at once? Is this possible somehow?
Kind regards,
To find out precise details, I warmly suggest to sing up for one of the many PMO seminars for EU institutions’ staff.
In short – yes, it’s possible. However, you can transfer the funds to a 3rd tier (private) pension fund in any EU MS that has an agreement with PMO. The funds will only become accessible to you when you turn 58. Then you can either take out the whole amount, or leave it at the fund in exchange for pension payments.
Dear Ben,
I have a doubt, maybe you can help me out.
If I work 10 years for the EU so that I’m eligible for a pension, but then I go back to my country and work there until I retire, can I receive from one side my pension from my country and on top de EU pension?
Or it’s mandatory to choose between them, transfer in or out and have only one pension?
The EU pension can be received in parallel to other pension-like entitlements, no problem here. Remember also that the EU institutions pension may not be taxed by national authorities, just like your salary. Regarding national pension and whether its payment might be affected by you receiving an EU pension, you would have to check national legislation/consult the relevant state institution. Best of luck!
A hypothetical scenario regarding survivors/spouse pension:
I reached my 10 years , and plan to leave the EU institution and leave the pension in the EU pot. With my minimum of 1200 waiting for 2048.
Im not due to reach my pensionable age till its year 2048.
AND (lets just imagine) THEN something happens and I die quite a few years BEFORE my due pensionable age.
Would my surviving spouse receive the 60% survivors pension or any kind of allowances straight AFTER DEATH? Or only after the actual due pensionable age of 2048?
It’s a dark one, not planing to die, but i think this point needs a bit more clarity for family members to know what and when they could get in terms of support.
thanks you Ben, very useful website
Roberto, thank you for another great question which I again will have to clarify with PMO when the opportunity presents itself. If you happen to find out the answer before the rest of us, as usual, please share.
Hello,
I have received an offer from an EU institution. I have read that there is a minimum pension for former EU officials. It cannot be less then 40% of the basic salary for a temporary agent AST 1 (currently EUR 1200.24).
I have also read that early retirement pension amount is reduced 3,5% for every year before mandatory pension age of 66.
Is this reduction of 3.5% aplicable to the minum of 1200.2 as well?
Thanks.
Fran
That’s a great question, to which I at the moment don’t know the answer about. When I’ll find out, I’ll update the article.
The PMO regularly organized only webinars about pension rights. Do sign up for one of these through your institution to get answers to the above and similar questions.
Exactly the same question on my mind, thank you Fran for putting it up.
If you enter service late in life and with a fair size of accumulated pension in a national scheme, can you transfer this in to the EU scheme and use that to take you over the 10y requirement? Say you have a fund which is equivalent to 7y contributions when you join. You transfer that in and work for 5y before retiring. Are you then eligible for a EU pension?
Hi! As far as I’m aware, you cannot reach the 10y participation requirement by importing your national pension scheme participation time. The 10 years have to be collected in the EU pension scheme.
However, you will be entitled to an EU pension if you retire from an EU institution before you reach 10 years of service. In this case the years accumulated under the national pension scheme and transferred in the EU scheme might increase your pension amount.
PMO regularly organizes workshops on “transfer in” of pension rights, please sign up to these workshops, they are very useful and give you the possibility to ask questions directly.
Hi Ben
Thank you very much for the very interesting read.
This fall I reached 10 years of working for an EU institution.
In the meantime I asked for an estimate for a transfer of my pension right from my home country, the 4 years I accumulated there translate in 6 months in the EU system.
Long story short now: I am planning to do something completely different in my life, might get into private business in my home town in a couple of years.
If I’m to leave my so far accumulated funds in the EU pension system, I will be entitled to the pension when I am 58 or 66? I am asking because once I get out of the EU institution, I am not planning to be back.
Thanks very much in advance for you help. Best,
Anja
Hi!
1) Regarding transfers-in from national to the EU pension system, I’m still trying to understand all the details, but I believe that what counts is the amount of funds transferred-in, rather than your period of insurance in the national pension scheme. Funds accumulated in the national scheme are equalized with the amount of contributions in one year in the EU system. So it will differ from case to case.
2) Regarding early retirement, see section “Can I retire early? What are the consequences?”. Yes, you can retire as early as age 58, however, you pension will be decreased by 3.5% a year or 28% from what you would be entitled at 66 and will remain so until your death.
You can withdraw the funds from 58 onwards. This applies both if you’ve left the funds with the EU pension system or you’ve transferred-out to a 3rd tier pension fund (privately managed fund) in an EU MS. It appears that you might be financially savvy. If so, you can evaluate whether you are able to find a privately managed pension fund from the ones approved by PMO in any EU MS, and that has a higher growth rate than the flat rate you get in the EU pension system. If you choose the latter, you might have substantially higher pension or funds to withdraw at age of 58 or later, but you might also make a poor choice and actually receive less.
Thanks, Ben 🙂
You are absolutely right about transfers, what matters is the amount in €€. Coming from a relatively new MS, my funds accumulated in 4 years in the national scheme got me a 6 months and 10 days in the EU pension system.
Thank you for the effort in publishing informations about the EU pension scheme, I really appreciate it.
Best,
Anja
Dear Ben,
I think that the 10 years of service is not the case for all. The staff regulation mentions:
An official who has completed at least ten year’s service shall be entitled to a retirement pension. He shall, however, be entitled to such pension, irrespective of length of service, if he is over pensionable age, if it has not been possible to reinstate him during a period of non-active status or in the event of retirement in the interests of the service.
“ He shall, however, be entitled to such pension irrespective of length of service, if he is over pensionable age,”
In other words, a permanent official hire at the age of 55, with one year of service and 10 years CCP, in my view he/she will be eligible for the minimum pension. Is this right?
Many thanks,
Ioannis
Dear Ioannis,
Thank you for pointing this out! I believe that you are, in fact, right and I have overlooked this provision in the Staff Regulation. This actually merits a separate, highly visible section in the article as an excellent pre-retirement move for a lot of experienced professionals in EU countries where pensions are low. I will update the article at the closest opportunity.
P.S. I’m so happy that pooling information from the readers and benefiting from all of your experiences works more and more frequently with this blog/page to all of our advantage. I hope that people will point out things that I’ve missed or should be clearer about more frequently as it improves the content significantly.
Dear Ben,
What would happen in this example?
You work for 10 years in the EU.
You then leave for several years.
Case 1: You apply for the minimum pension at the age of 66
Case 2: You apply for the minimum pension at the age of 58
Is the minimum pension of 1200 euros reduced in case 2, by 28%
In both cases, the amount of years is the same. Also, one maybe have accumulated these ten years between his 48th and 58th birthday, and another between his 55th and 65th birthday.
Thank you
Case 2 unfortunately is correct. And worst of all – the pension does not increase to 100% after you reach the age of 65. So a really tough choice for those who want to retire earlier than 65 and enjoy life (like I would do if I could).
I did not really get what you meant in your last paragraph.
Thank you for your kind reply. Indeed, I should rephrase the second paragraph 🙂
Person A person and person B work for 10 years each.
– Person A from the age of 48 to 58
– Person B from the age of 56 to 66
Person A’s minimum pension is 864 euros
Person B’s minimum pension is 1200 euros
Is this correct?
Elm, in reply to your Oct 25 clarification, both persons are entitled to the same amount of pension. It would be ~1200 or higher (depending on last salary) if both persons claim their pension at the age of 66. It does not matter that one of them stopped contributions to the system earlier than the other. The pension would only be decreased in case of EU pension claim before the age of 66 (any period from 58-66).
Thanks Ben, do you know the rate at which EU pensions are taxed?
I have accumulated 6 yrs of FGIV pension contribution in the EC system. I left the EC recently, and while they push to channel your funds out, they can not legally require it. What is your advise, what should me (and thousands of others) do? What is better, leave the funds in the EC – and what this would mean in terms or claiming it later (in 10-20 years), in terms of amount and choices?
Indeed, you cannot be forced to withdraw funds from the EU pension system.
While each situation is different and there might be more nuanced circumstances for each individual person, in most cases the decision to withdraw or keep funds in the EU pension system should depend on whether you ever again plan to work for the EU and qualify for the EU pension. As written above, one needs 10 years of service to qualify. In your case you only need 4 more years, so it might be reasonable to keep the funds in. It is always possible to withdraw the funds, unless you suddenly die in which case the funds disappear. It is much harder and more expensive to rejoin the EU pension system if you have withdrawn the funds.
If you are certain that will never again work for the EU, then it actually makes sense to withdraw the funds and invest in a 3rd tier private pension funds that offers returns larger than capital growth in the EU pension system. If you find a pension fund that just invests in the so-called index funds, then you are almost certain to have higher returns on your pension capital than the EU pension system offers.
I have personally chosen to stay with the EU pension system as a) it’s a relatively safe bet, b) capital still grows more or less in line with inflation, c) there are other benefits at pension age such as the survivor’s pension for one’s spouse and entitlement to JSIS. All of this makes the EU pension scheme attractive to me.
Dear Ben (?),
Thank you for this comprehensive explanation. Question: if I work in PL with a coefficient 70,9%, and after service, I return to BE, will my pension be calculated on bases of my last salary (70,9%) or will it be 100% based on BXL coefficient? Additionally, what means ‘transfer’ in the 2nd column of the coefficient table?
Thank you.
Ika
Hi! According to Article 82 of the Staff Regulations, “No correction coefficient shall be applicable to pensions.” Hence, it does not matter where you reside when you retire, you will receive the full pension. https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX%3A01962R0031-20210101&qid=1621964486547
I’m not sure what you mean with the question about “transfer”. Please clarify and I’ll try to answer.
Hello Ben,
Thank you very much for your detailed explanation! I think I have the same question here (to which I couldn’t find a clear answer):
Imagine 2 agents with the exact same grade/step/length of service, but worked respectively in PL and BE at the end of the career, are they getting the same amount of pension? (To calculate the pension, is the correction coefficient applied to the “basic salary“ to reflect the real amount received before retirement, or is it the same “Bruxelles” basic salary for everyone’s calculation?)
Thanks again!