The Pension Reform brought major changes in relation to retirement based on contribution time .
Anyone who has already met the requirements of the current rules will not be affected by the Reform. However, workers looking to enter retirement by contribution time after the changes should be aware.
If you have questions or want to deepen your knowledge about the new rules, continue reading. To know other aspects that change with the Pension Reform, click here.
New rules for retirement by contribution time: before and after
To understand what has changed in retirement by time of contribution , it is necessary to understand what the pre-Reform scenario was like. Before, according to the general rule, there were two possibilities for a person to retire:
- by time of contribution: 35 years old for men and 30 years old for women;
- by age: 65 years old for men and 62 years old for women, accumulated with a minimum of 15 years of contribution.
However, the new rules provide for the end of retirement by contribution time. Now, the general rule stipulates a minimum age of 65 for men and 62 for women, in addition to 20 years of contribution for men and 15 for women.
In addition, you need to pay attention to the amount received. According to the new retirement rules by time of contribution, these 15 or 25 years of contribution guarantee the receipt of only 60% of the average salary.
Those aiming to retire with 100% of their salary must contribute for 35 years (women) or 40 years (men).
During this period, the Government stipulated six transition rules. Are they:
This is the fastest way of accessing the benefit for most workers who want to enter retirement by contribution time.
The Points System is based on a formula known as 86/96. The worker must add his age plus contribution time, and the result must equal 86 points for women and 96 for men.
This rule also requires the individual to have at least 30 years of contribution (women) and 35 years of contribution (men).
Starting in 2020, the required ratio will increase by one point each year. That is, in 2020, the worker needs to add 87 points (women) or 97 points (men). By 2021, women will need to have 88 points, while men will need to have 98, and so on.
The sum only ends when the ratio reaches 100 and 105 points for women and men, respectively. This will happen in 2035.
Under current rules, the minimum retirement time requirement for contribution time is 30 years. The toll rule applies to those who are two years or less away from reaching the required time.
Altogether, the worker will fulfill the time that lacks contribution plus half of this remaining time. For example: those who need to contribute for another two years under the current rules, must comply with 3 years, as it is the sum of the time left (2 years) with half of the necessary contribution (1 year).
It applies to those who today have the minimum age to retire. In addition to contributing the missing time, the worker needs to add another 100% “toll”.
For example: a woman with 27 years of contribution needs to complete 6 years to retire – 3 years until the minimum contribution period (30 years) and another 3 of “toll”.
Retirement by age
It is valid for those who are old (60 years for women and 65 for men), but with less contribution time – which must be at least 15 years.
In the case of women, the minimum age requirement will increase by 6 months each year until 2023. From then on, the general rule proposed by the Social Security reform will apply, which is a minimum of 62 years.
The case of men is similar – with an increase of 6 months of contribution time per year. However, this increase only goes until 2029, when the 20 years of minimum contribution are added. At the end of the period, the rule converges with that of the general regime.
Progressive minimum age
In 2019, women aged at least 56 and contributing 30 years old and men aged at least 61 and contributing 35 years old can apply for retirement based on contribution time .
As of 2020, the minimum age “wins” 6 months each year, until it matches the proposal present in the reform. That is, 62 years for women in 2031, and 65 years for men in 2027.
Scoring system for civil servants only
Public servants will also have a scoring rule, which follows the general standards: 86/96, with a maximum of 100 points for women and 105 for men.
However, the differences are in the minimum contribution time, being 30 years for women and 35 for men. In addition, the minimum age required for public servants is 56 years old (women) and 61 years old (men).
Why is pension reform necessary?
The answer is simple: the account does not close. The Federal Judiciary has already proven that Social Security and Social Security have deficits that reach billions of Dollars per year, which can increase more and more as the age of the population tends to increase and the birth rate fall more and more.
Why is it so important to contribute to Social Security?
Although the new rules have left retirement a little more distant for most of the population, contributing to social security is essential to ensure various emergency situations that may occur over time, such as sickness benefit, for example, or the maternity salary, which is only valid for those who contribute.
And even with all the change, it’s hard to argue that social security won’t bring you any security at an older age. The leap of the cat is to be careful, think about a private pension now, and bet on other investment fronts to ensure a comfortable retirement.
If you fall into the categories benefiting from public pension, know that it is your right, it serves to protect your retirement and give you greater security at the best age, even with all the mishaps. The important thing is to understand well how it works today to look for alternatives that complement the cake you will receive when you retire, and give you greater comfort in the future.
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