“It’s too complicated !” Here is what many French people answer when it comes to estimating their future retirement pension. However, this step is essential to put in place an end-of-career strategy. Too many people give up or make excuses before they even try to understand.
Episode 1 – Retirement: do the French really know their rights?
Episode 2: Do you have to reach the legal retirement age?
Episode 3 – How to correctly calculate the amount of your retirement and limit errors?
Episode 4: what changes for your pension rights in the coming months?
As we were able to observe through our survey – commented on in our episode 1 – a very large majority of working people do not know their pension rights, do not know how to prepare for it or how it is calculated. Witness the confidences of Sylvie, 61, who plans to end her professional career in a few months, without even knowing what she will perceive.
“I worked for almost 40 years in a hairdressing salon, taking breaks for my 3 maternity leaves. I also had a few brief periods of unemployment and occupational illness, but overall I worked all my I know that the legal retirement age is currently set at 62. I therefore plan to liquidate my rights in a few months, before the pension reform comes into force, and the legal retirement age is pushed back. I have back problems caused by my activity, and I do not see myself working for a few more years”, confides to us this ex-manager of a hairdressing salon in the south of France, who became an employee there. three years ago, in order to “get rid of too many administrative constraints”. “I preferred to sell my living room some time ago, because with the extended hours that we work, I could no longer manage the papers and could not afford to hire a secretary. So when someone talks to me having to look at my retirement file to estimate my future pension, it gives me pimples. I don’t understand anything about it and don’t even know how it is evaluated. I know it’s a matter of quarters and duration I have been told that there is an online simulator that allows you to estimate it, but I am not sure how it works. On my own, I think I would not be able to use it. Then , anyway, I tell myself that the pension funds already have everything. I do not see what I could check, they know better than me the rights that I have acquired.
Like Sylvie, many prefer to place all their trust in their pension funds, which list their rights acquired throughout their careers. They thus place their future purchasing power in the hands of the administration, which is far from infallible. Failing to properly address this task can therefore cost them a lot of money.
As we report in a previous article, the calculation errors on the new pensions paid “continue to present a high level”. The Court of Auditors has indeed revealed in its new report on the certification of Social Security accounts various malfunctions, often to the disadvantage of retirees.
“One in seven newly awarded pension benefits was affected by at least one financial scope error in 2021.” This is slightly less than in 2020, where one file in six included a blunder, but according to Dominique Prévert, partner at the consulting firm Optimaretraite, this figure is largely underestimated. “Assume that there are mistakes!”, he warns.
Errors on retirement pensions: 6 elements that harm you The number of errors on new pensions paid has certainly decreased slightly in 2021, but the frequency “continues to present a high level”. In its new report, the Court…
“Especially if your career has been cut short: unemployment, illness, change of employer or status (going from executive to non-executive, self-employed), expatriate, military service, part-time… All these cases represent a risk higher error”, he warns.
So what should be checked?
This is the reason why “pointing, comparing and verifying your documents and your individual career statement (RIS) is decisive. It will allow you to establish a fair calculation and during your liquidation of rights to retirement”, explains the expert.
Indeed, to be able to make a correct calculation (which we will detail below), it is still necessary to enter correct data.
“Do not wait until the last moment to check and compile your file.” Here’s how.
“Examine your career statement annually via your online account that you must create on Info-retraite”, explains Dominique Prévert.
Via your personal space, you can:
© Press Office
As for your career statement (RIS), it includes:
“In this way, you will be able to compare the memory of the institutions and yours, supported by evidence, from an early age. This work of reconstructing your history is essential, because it will allow you to observe whether the elements indicated on your RIS are consistent Quarters contributed, assimilated… There are 1001 things to check Your interest and to detect errors and write to your pension fund to ask for them to be corrected, with supporting documents. a that in this way you will be sure that rights have not been forgotten. As a reminder, there are no small corrections: a few euros related to a life in retirement (more than 20 years on average), this represents thousands of euros in total”, recalls the retired expert. “That’s why you have to be willing to spend time in your archives. You will earn money doing this work. Don’t blindly trust pension funds!”
Because once your retirement file has been validated, the time limit for contesting the amount of the pension is only two months. It is very little when the errors are numerous, and when it is necessary to find and collect career documents, often scattered.
© IstockRetirement pension: how to dispute the amount?In some cases, the amount of the retirement pension calculated by the competent authorities is not correct. When this happens, then it must be challenged.
To help you, get information from pension funds, specialized sites or magazines. Planet also publishes daily articles dealing with the issue of pensions. Pedagogical work must be carried out in order to properly analyze the financial issues in question. Try it yourself first. This verification activity is within everyone’s reach. If you think the stakes are too high, use a service provider.
Here is also a reminder of the calculation rules.
To find out about the amount of your future retirement pension, you can use dedicated online services.
The calculation of your future pension takes into account:
© Press Office
As we detail in a previous article, the calculation formula is as follows: average annual salary × liquidation rate × (duration of contribution/reference duration) = amount of the basic pension.
The official M@rel simulator will allow you to easily assess the amount of your future pension, based on your current and future rights. Here’s how to use it well.
Despite the information found on your career statement, are you having trouble evaluating your future retirement? A free service offered by your pension plans can help you do this. This is the official M@rel simulator which is defined as personalized, interactive, practical and fast.
As indicated on the Info-retraite site, you can:
© Press Office
“To make all the right decisions at the right time and in harmony with your life choices, it is necessary to approach the mathematical part. It will allow you to compare the elements: should you remain unemployed or retire? Should I postpone my departure by one, two, three or more months to validate missing quarters or obtain a premium (1.25% per additional quarter) Ask yourself all the possible questions and compare different scenarios to make no mistake. The M@rel simulator is very good for that”, assures Dominique Prévert. “Above all, think in euros and not in quarters. The important thing is what you will actually receive in your account each month. Will the amount be enough for you? Think about it when doing your accounts.”
The larger your stock of rights, the greater the stake in euros. On the other hand, if at age 62 you are 10 quarters short, you can, of course, assert your rights, but your pension will be reduced. “Go to M@rel to do the simulation. We will estimate that the reduction is equivalent to around €250 or €300/month on the pension. On a life expectancy of around twenty years, the shortfall is colossal. However, this amount is not the same for everyone. For someone who will receive a small pension, it’s huge. For someone who has, for example, built up a comfortable funded pension or whose pension will be high, this sum can be almost insignificant. Then ask yourself what this amount represents on your purchasing power. Can you do without it? 10 quarters is the equivalent of two and a half years of work. You Do you feel capable of accomplishing them? not to go on the Pole simulator Employment and compare the level of your future pension with your possible allowances and your salary. This will help you in your final choice in order to obtain a full pension”, explains the partner of the cabinet Optimaretraite.
Full rate, full retirement… what is the difference and what are the advantages? Retirement has a number of nuances, which are sometimes complex to grasp with precision. Return on the full rate and full board.
Thanks to these different elements in hand, “you will then be able to build your strategy: choice of age, date, regulations… Run simulations to find out which one corresponds to what you want and serves your interests. I dentify, for example, what that you have to gain more by shifting your date. Beyond the salary which is higher than that of retirement, how much more will you get on your retirement? If your career has holes or particular situations, waiting may Do not forget that the calculation of purchasing power is essential for your life choices as well as for your needs at the time of retirement (mortgage still in progress or not, debt or not, independent children or not …) Each profile is different”, recalls the expert.
Take advantage of the opportunities available to you. Here are a few.
“Beyond age, there is also a reflection to be had on the departure date. Refine and specify by choosing an opportunity date. Because, working one month more can allow you to validate one more term. .”
“Regarding the last year, for a quarter to count, you have to leave at the end of the year. Even if you leave on October 1, wait until January 1, so that your last year (often the best) counts for the calculation of the average annual salary (last 25). Here, the issue is also fiscal. Your January payslip will indeed be counted for the following year (you will therefore not increase your marginal rate, since you will have less income the year of retirement”, points out Dominique Prévert.
Finally, he recalls that, whatever the case, the insured keeps control.
To avoid mistakes and optimize your pension, consult our various articles:
Retirement: starting age, full rate… 20 tips to assess and optimize itRetirement: starting age, full rate… 20 tips to assess and optimize itLike the vast majority of French people, retirement worries you ? To liquidate your rights under the best financial conditions, an end-of-career strategy…
Retirement date: 8 tips for choosing it well The day of liquidation of your retirement rights should not be chosen at random. The act must be carefully considered, according to your needs and desires. By opting for an opportunity date, you…
Would you like to know the changes to your pension rights in the coming months? Find some answers in episode 4 of our investigation.
Retirement: what will happen to your rights in the months to come? EXCUSIVE SURVEY – EPISODE 4. The cascade of reforms denounced by some of our experts has not yet ended. The President of the Republic intends to transform the system once again….