How state pensions abroad are calculated

If you have already gained some experience and years of work on your resume, you have probably started to wonder if, after these years, you will be able to benefit from a pension for when it will be time to settle. If you did, good for you, especially if you have been working abroad. Even if you work in The Netherlands or any other country abroad, you may have state pensions abroad rights in each of them. Here's what you need to know:

How to retire after years of work abroad

For all countries in the territory of the European Union, if a person has worked legally under a contract of employment, he will have the right to claim his state pensions abroad rights in those countries. Even if you have worked for 2 years in over 10 countries, you will be able to claim your rights in each of them. What should you do? Go to the pension institution. You can go either to the pension institution in the country where you live or to the country where you were legally employed.

You should do this at least 6 months before you retire. The process takes quite a while, and each country has its methods of gathering enough data about your latest jobs. Even if you worked in Romania, or even if you worked in The Netherlands, Germany, Spain, or Italy, that country is obliged to look for documents proving that you have paid contributions to the state for the entire period in which you were employed. Only then, the government will be able to start taking action to grant pension rights.

What if retirement ages differ?

The retirement age in Romania is 65 years for men, and for them to complete a full contribution period, they will have to pay a pension contribution of a total of 35 years. For women, the retirement age is 61, and they must meet a full 31-year contribution plan. The retirement age in the Netherlands is 66 years, and experts say that it increases with life expectancy. So there can always be differences between these values.

What do you do if retirement in your country is possible but retirement for a few years of work in the Netherlands is not? Well, the legal retirement age may differ, but you must be eligible for retirement in all countries. If you have worked in three different countries and the retirement age is 64, 65, and 66, you must be 66 years old if you want to get the rights from all three.

It is good to know that if you are not old enough in all countries, you will still be able to submit your documents to receive your pension rights. But if you don't do this all at once, the amount of money you receive as a pension may change. Each country has more or less similar conditions, and before starting the state pensions abroad claim process in each country, we recommend that you document yourself very well.

This is an example of a pension for years worked abroad when the age is not eligible for all countries. If you worked in the Netherlands for 20 years while the minimum age was 65 and you returned  at 63 because that was the eligible age in Romania, you will receive a very small pension because you are only eligible for Romania. You will have to wait until you turn 65 to receive your pension in the Netherlands.

Pension for years spent working abroad at the European level

If you have only worked in European Union countries, you will benefit from something called a "theoretical pension," which is calculated based on a fairly simple algorithm, but which at first glance is difficult for most people who want to opt for such state pensions abroad. From a theoretical point of view, if you have worked in France for 25 years and only 5 years in Italy, you are not eligible for a pension in Italy because you have not met the minimum 15-year contribution requirement.

But what the European Union does to give you a pension for years of work abroad is to calculate each pension based on the fact that you can receive the pension because you are eligible in France. Because they are part of the European Union, they will be calculated cumulatively.

If you were to receive 1500 euros for 25 years in France and only 300 euros for 5 years in Italy, the total would be 1800 euros. Even if you are not eligible for a pension in Italy, the fact that both countries are part of the EU makes this cumulative calculation possible.

How do you receive state pensions abroad?

Here, things are very simple. If you need to receive a pension from several countries and you have already completed the entire process, each country will be able to send your pension directly to the bank account in the country where you live. The only exception is when you have to receive money in a country that is not in the European Union. In this case, you must open a separate account in each country from which you must receive a pension for the years you worked abroad.

To receive state pensions abroad for years worked, all you have to do is be eligible in terms of age, and you can claim all pensions in all countries at the same time. Be well informed in advance so that you can start gathering all your documents at least 6 months before retirement

Do you aspire to work in the maritime, industrial, logistics, or construction industries in the Netherlands?

If the answer is yes, then reach out to the DB Work team or send us your CV at job@dbwork.com. Don't forget to take a daily look at our available job positions.

And when it comes to the benefits of a contract mediated by DB Work in the Netherlands, we invite you to discover the complete list of advantages in our article.