Pension calculation: Those with minimal wages will not exceed 24K RSD

Pension calculation: Those with minimal wages will not exceed 24K RSD

Therefore, it is not surprising that questions from middle-aged and young people are heard about whether they will live to retire, what is going to be the age limit in the future, and how old they will have to be when they retire.

According to the calculations of the Fiscal Council, everyone who worked for 40 years for the minimum wage (which rose to slightly more than 40,000 RSD from January 1, can count on a pension of 23,596 RSD today. For those who earned more than the minimum wage for 40 years and a salary of about 50,000 RSD per month, the pension would be 29,495 RSD.

Those who made 70,000 RSD would receive a cheque of 41,290 RSD, while those who earned 90,000 RSD can expect a cheque of around 53,000 RSD (53,090 RSD). "After the latest increases in pensions, the income for retired workers with 40 years of service in this year is around 58 to 59 percent of their earnings.

It is a more relevant indicator than the ratio of the average pension to the average salary (which is, understandably, the most often cited by the general public) because the average pension includes family pensions, disability pensions (which have been subject to embezzlement for years), as well as agricultural pensions - which are much lower the average pension," said Nikola Altiparmakov, a member of the Fiscal Council, for "Blic" daily.

Mr. Altiparmakov also added that even the majority of older-age pensioners do not have 40-year work experience (the average is about 32 years of experience), so the ratio of average salaries and pensions is much lower than the 58-59 percent of the average cheque for those who have completed 40 years of service.

The formula

The calculation formula is not simple, but the essence is that the higher the salary during the working period, the higher the pension. The pension cheque is practically equal to the product of personal and general points. To calculate a personal score, we need to calculate a coefficient.

We get there when we divide each of our annual earnings by the average national earnings in the respective years and then divide the sum of the obtained amounts by the years of service. From January 1970 to 2002, earnings are taken in the net amount, and from 2003 in the gross amount.

When we know the personal coefficient, we multiply it by the years of service and get a personal score. Finally, we multiply the obtained amount by the general coefficient, which amounts to 909.45 RSD as of January 2022.

Increase in January

As of January 1, pensioners' incomes have been increased by 12 percent, and that percentage will be applied linearly to all pensioners, regardless of the amount of the pension.

Previously, during December, all retirees received an increase of about 9 percent. The average pension cheque of 30,965 RSD, after the increase, will be higher by 6,255 RSD.

The age limit has also been moved up

New rules for women's pensions also apply from January 1, meaning that any claim made by women in 2023 will be subject to new, more rigorous conditions.

Thus, ladies will be able to retire at 63 and 6 months with a minimum of 15 years of service. On the other hand, the conditions for regular retirement for men remain the same, but this is not the case when we talk about early retirement.

Thus, they will be able to take early retirement from January 1 next year with 40 years of service and at least 60 years of age. Women retire early with 40 years of service and 59 years and six months of life.