RISP
Recycles dryer sheets
- Joined
- Jul 18, 2012
- Messages
- 407
Inspired by a recent thread, I decided to look up how benefits change if you file early or late for Germany's "gesetzliche Rente" (basically our version of Social Security).
The earliest age to draw Rente is 48 months before FRA (so, at age 63). Benefits are reduced by -0,3% for each month that you file early, and are increased by +0,5% for each month that you file late.
The following table compares benefits at various ages in the German vs. the US system. The benefit at full retirement age is set to 100 (I used 67 years of age because this is both the FRA for Americans born after 1960, and Germans born after 1964).
Turns out filing early is relatively much more attractive under the German system, while filing late benefits Americans more. I do remember reading once that the reductions for drawing Rente early are not actuarially correct (the cuts would have to be more severe).
If anyone can provide information for other countries or systems, I would be happy to update the table.
The earliest age to draw Rente is 48 months before FRA (so, at age 63). Benefits are reduced by -0,3% for each month that you file early, and are increased by +0,5% for each month that you file late.
The following table compares benefits at various ages in the German vs. the US system. The benefit at full retirement age is set to 100 (I used 67 years of age because this is both the FRA for Americans born after 1960, and Germans born after 1964).
Age | Germany | USA | UK | |
62 | 70,0 | |||
63 | 85,6 | 75,0 | ||
64 | 89,2 | 80,0 | ||
65 | 92,8 | 86,7 | ||
66 | 96,4 | 93,3 | ||
FRA | 67 | 100,0 | 100,0 | 100,0 |
68 | 106,0 | 108,0 | 105,8 | |
69 | 112,0 | 116,0 | 111,6 | |
70 | 118,0 | 124,0 | 117,4 | |
Turns out filing early is relatively much more attractive under the German system, while filing late benefits Americans more. I do remember reading once that the reductions for drawing Rente early are not actuarially correct (the cuts would have to be more severe).
If anyone can provide information for other countries or systems, I would be happy to update the table.
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