One-third of people in Belgium retire before the current statutory retirement age of 65. Here's how to calculate whether you can do the same.
The Belgian government is looking to raise the retirement age to sustain the evolution of an ageing population. At the moment, the statutory retirement age for private sector workers is 65, but this will be increased to 66 in February 2025, and to 67 in February 2030. However, different age limits apply to certain categories of workers.
No one is obliged to work until the statutory retirement age. If a person has saved enough to cover the period until retirement and is satisfied with a lower retirement benefit, they can also stop working at 50, for example.
Figures from Belgium's statistics agency Statbel show that in 2021, 37.5% of Belgian employees retired before the age of 65, while among civil servants, as many as three-quarters leave to take their pension before this age.
Financial consequence
If someone stops working before they are entitled to a pension benefit, this will affect the monthly pension that the Federal Pension Service will pay into the retired person's bank account.
There are three factors which influence employee pension: how many years worked (or received unemployment or sickness benefits), wages and family situation.
The annual pension is the sum of all pension income accrued during your career. The Federal Pension Service calculates the benefit by adding up all wages (or estimated wages in the case of a benefit) of that year per year worked up to a maximum of the salary ceiling of €71,519.91. After that, the service revalues that amount. The revalued wage of the year worked is then divided by 45 for 45 career years.
The amount you get is multiplied by 60% for most people. For married people with a partner who had no or almost no wages, however, it multiplied by 75%. The sum of all pension shares is your annual pension.
How to calculate your pension
The minimum age for early retirement is 60 for people who have worked for 44 years, 61 if worked 43 years, and 63 for those who worked or received benefits for 42 years.
Those who stop working up to five years earlier may be entitled to an early retirement based on the years they did work and the wages they received, but their pension amount will be lower because they worked fewer years.
When stopping work completely, they will obtain a lower number in the calculation for the number of years worked, and that results in a lower annual pension amount.
People who want to estimate the pension they will get can multiply their average salary by 60% over their entire career. Suppose they worked not 45, but 30 years, they will then have to multiply that amount by 30/45.
With an average net monthly salary of, for example, €3,000, they get a full pension of €1,800. If they worked for 30 years, that is €1,200. Importantly, however, they will only receive this monthly benefit when they reach the statutory retirement age.
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People who decide to stop working should of course make sure that they have saved enough to bridge the years until retirement and then have enough to make ends meet while living on the lower benefit.
The statutory pension savings is only one of the various pillars that make up the pension; there are other ways to ensure that a person's pension fund remains sufficiently large. The first way is the supplementary pension through the group insurance that your employer provides as a fringe benefit.
The supplementary pension that people can accrue by making individual pension savings is another option. Even though these added pension amounts will be lower if they stop working earlier, it can still help boost the coffers. Finally, investing or saving can also help have a little extra on hand later in life.
