# German Pension Fund (Rentenversicherung): basic questions



## Donford (Mar 22, 2016)

Hi,

Some basic quick questions about German Pension Fund (Rentenversicherung):

1) Besides the money you pay in regularly (e.g. from your salary or additionally voluntarily) does it grow on its own as well? Do they apply some investment growth on it? How much does it grow?

2) When you retire, can you withdraw a lump sum from it (partially or fully) or are you only entitled to montly pay-outs?

3) How do they calculate how much pay-out you get per month after you retire?

4) If the value of the fund is x when you retire, but after a few years of pay-outs to you the fund is depleted, what happens then? Or do they pay out to you undefinately i.e. until you die?

5) If you die before or after you retire, what happens to your fund?

6) If you leave Germany (i.e. cancel all permits) and wait the 2 years waiting period, and comply with all the other requirements they have for being allowed to apply for this, do they pay out the full value of the fund at that point, or do they subtract fees or tax or anything else from it and then pay you out the rest?

7) In the case of the (6) above, would they be able to pay it back to you in your foreign (home country) bank account, or do they have some other unexpected limitations or suprises making it difficult to get the funds out?

Thanks in advance!!


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## ALKB (Jan 20, 2012)

It's not a fund, it's an insurance. The money working people pay in today pays for the pension of today's retired population. 

How much you will get depends on how long you paid in and how much you paid in.

Monthly pension payments can be received internationally. There may be bank charges for that.

Payments will continue until you die, after that, a surviving spouse may or may not be eligible to keep receiving a certain percentage of the payment you received.

I am sure somebody more knowledgeable will be able to answer in more detail.


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## Bevdeforges (Nov 16, 2007)

Having just started receiving my Deutsche Rentenversicherung after a mere 2.5 years of working in Germany ages ago, I can tell you what my experience has been. NB however that I think the system has changed somewhat in the last several years.

To my understanding, the Rentenversichung is not a "fund" as such. You pay a set percentage of your pay while you are working, and your employer pays in a like amount. (When I was working in Germany, all social insurance benefits were split 50-50 between employer and employee.)

I was never offered any option to take a lump sum payment - not when I left Germany, and not when I reached retirement age. Actually, it was when the French retirement system started doing regular estimates of benefits that they must have contacted the German Rentenversicherung, because I had had to fill in my work history for them, and included the 2.5 years I had worked in Germany. At the time, they sent me a bunch of forms to fill out if I wanted to claim my pension early (which I didn't). But, again, there was no option to take out any lump sum.

When I applied for my French pension last fall, I again had to validate my work history on file with the French pension agency - and shortly after I submitted the paperwork for France, I was contacted by the German Rentenversicherung saying that I could claim my pension starting from an earlier date in Germany than in France. Did I want to do that? Once I confirmed that to them, they calculated my monthly pension and sent me a letter telling me that I would get a "retroactive" payment covering the months from the earlier payment date - and then a fixed amount each month. 

Frankly, I have no idea how the amount was calculated - but it was, in fact, more than I had expected (particularly given that I had only worked in Germany for a little over 2 years). From what they said in the letter, the payments will keep coming until they are notified of my death (most likely by my bank - they pretty much insisted on a direct bank transfer).

But there does not appear to be a "fund" and also no lump sum option. If you die before your can collect, you lose. I assume that if the amount of your pension is too small, they might opt to make quarterly or annual payments, but if you're in a country where you can make and receive direct bank transfers, I assume they will pay you in that manner.
Cheers,
Bev


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