Raising the earliest possible retirement age by one year, resulting in a required starting age of 64, is projected to significantly alleviate the financial burden on the state, saving over 700 million Euros per retiree cohort over the long term. This finding comes from a study conducted by the German Institute for Economic Research (DIW) commissioned by the Bertelsmann Foundation, which was subsequently reported by the “Handelsblatt”.
The Pension Commission had originally recommended increasing the minimum age for early retirement with deductions from 63 to 64. According to the study, implementing this change would allow the labor market to retain the employment potential equivalent to 31,000 full-time workers.
Despite the change in the mandatory retirement age, the reform would carry financial advantages for the affected insured persons. The study indicates that because the associated deductions would be smaller and continued employment would contribute additional pension points, the average monthly pension would be approximately three percent higher than it is currently.
