Stop working earlier? These are the possibilities | NOW

Everyone sometimes thinks about it: stopping work earlier. No more walking in the office every day, but working in your garden all day, traveling around or just doing nothing. But can you just retire early? And what conditions are attached to it?

Those who work in paid employment build up pensions for their entire working lives. As soon as you reach retirement age, you are entitled to this money pot. “Now that age is around 67 years, but it will in all probability be higher in the future,” says pension coach Jorg Goedvriend. “Your final state retirement age is set five years in advance.”

This does not mean that you have to work until you are 67, in the Netherlands you can also retire earlier. “There is no legal minimum age at which to apply for a pension,” says Goedvriend. “But the government is no longer calling for early retirement.” For example, you pay 17.9 percent extra tax on your early retirement pension and every year, 4 to 7 percent money is also deducted because you advance the pension. “The disadvantage is also that you no longer earn a pension in these years. So you have to stay longer with less pension.”

It also confirms the spokesman for the Ministry of Social Affairs and Employment (SZW): “Applying for a pension earlier leads to a lower pension benefit, but gives employees an instrument to stop working earlier.”

“By managing your finances, you know if you need to work a little longer or if you can just stop”

Jorg Good friend

Retires five years earlier

Therefore, Goedvriend recommends building up sufficient savings well in advance. “You have already paid tax on this money, so they are all yours.” You can then use it to work part time e.g. “From five years before your AOW date, you can continue to work alongside your early retirement pension. So, for example, you can still work for two to three days, filling the rest with a lower pension amount and your savings.”

If you want to retire six, seven or ten years earlier, you really have to stop working. “Then legally you must not have a part-time job next door. Then you must really be able to live fully from your pension or your savings,” says Goedvriend.

For this reason, the pension coach also advises you to properly calculate how much money you expect to need to be able to live. “What are your fixed costs and what are you planning to do? Everyone who wants to travel will lose more money than anyone who would rather sit at home. By managing your finances, you know if you need to work a little. longer or just stop. “

The employer can help with the early retirement scheme

There are also schemes where the employer helps, such as the early retirement scheme (RVU). It is stated in the agreement for people with heavy occupations, such as police and construction workers, but it applies to all employees until 2025. The national government’s website states that this early retirement pension is intended for employees who were not able to prepare for the increase of the state pension age, and for persons who do not reach the state pension age in good health and at work.

The SZW spokesman explains that there are two conditions for making use of this scheme. “The exemption only applies for the three years preceding the state pension age and it applies up to an amount of 1,874 euros per month. This amount corresponds net to the AOW.”

The employer therefore pays AOW for a maximum of three years without this being deducted from the pension pool. Good friend: “The question is whether any employer will agree to this. Then they have to pay wages for three years without having to work for it. The chance is therefore small that someone with an office job is entitled to this.”

savings on leave

An employee can also use saved leave. The maximum has been extended from 50 to 100 weeks since 2021, the spokesman said. “The idea is that the earned leave (in part) can be taken at different times in the career. It gives employees space to increase their sustainable employability themselves, for example by using the extra saved leave a few years before retirement age. Work less or take time during the career for retraining or a sabbatical year. “

In addition, Goedvriend also advises looking at investment opportunities. “Start early with this. Investments provide no guarantees, but if your investments provide the expected return, you can stop earlier at your own expense. Otherwise, you continue to work (part-time) until your original retirement date. Or then date, because you can continue working alongside your national pension. “

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