What you live on later comes from three pillars: the state, your employer and your own saving. Here's what each one pays, and how the new pension account from 2027 helps with the third.
Your check-up
What to know
-
Pillar 1: know what the state pays
Employees pay 18.6 % of gross pay in, half each with their employer. Every year earns points, and from 67 they pay a pension for life.
Points for every year. A year on average pay earns one: €42.52 a month.
Average pay is €51,944 in 2026, and 45 years on it make the standard pension, €1,913 a month. Pay above the ceiling, €101,400 a year, earns nothing more: at most about 1.95 points a year.
From 67, or earlier at a cut. From 63 with 35 years in.
0.3 % less for each month early: 14.4 % less at 63, for good. After 45 years, from 65 without a cut. A government commission recommended changing these ages in June 2026; until a law is passed, they stand.
Your statement. The Renteninformation, every year from 27.
Once you've paid in five years, it shows what you've earned so far and what you'd get at 67. Years abroad or raising children count only once you claim them: ask for an account check (Kontenklärung). The state's free portal, rentenuebersicht.de, shows your state, workplace and private pensions together.
It's before tax. 84 % of a pension starting in 2026 is taxable.
The share rises by half a point a year, to 100 % for pensions starting in 2058, and health and care insurance come off too.
-
Pillar 2: use your employer's pension
Part of your gross pay goes into a pension before tax and social contributions (Entgeltumwandlung), and your employer adds to it.
Your right. Up to €338 a month, free of tax and contributions.
Every employee in the state pension can ask to convert up to 4 % of the contribution ceiling: €4,056 a year in 2026 (§ 1a BetrAVG). Up to 8 %, €676 a month, is free of tax.
Your employer's 15 %. Where converting saves it contributions.
The law sets 15 % of what you convert into direct insurance, a Pensionskasse or a Pensionsfonds. Many employers add more, or pay in on their own: ask HR what yours does, and which provider it uses.
Tax later. What it pays out is taxed as income.
In public health insurance, health and care contributions come off it too, above an allowance. And converted pay that's free of contributions earns no state pension points.
Changing job. What you converted is yours from day one.
What your employer funds is yours once the promise is three years old, if you leave at 21 or older. Within a year of leaving, you can ask for it to move to your new employer's scheme (§ 4 (3) BetrAVG).
-
Pillar 3: save with the new pension account
From 1 January 2027, the Altersvorsorgedepot: a pension account in funds and ETFs, with up to €540 a year from the state and tax relief on top. It takes over from Riester for new savers.
What the state adds. 50 cents per euro up to €360 a year, then 25 cents up to €1,800.
€150 a month of your own gets the most, €540 a year. For each child you get Kindergeld for, a euro for each euro, up to €300 a year. Under 25, a one-off €200 more. You pay in at least €120 a year.
Tax relief on top. Worth most at higher pay.
Payments up to €1,800 a year plus the allowances can be deducted. Where that saves more tax than the allowances, the tax office refunds the difference. Payouts are taxed as income.
Who can have it. Anyone in the state pension, and now the self-employed.
Employees and civil servants, self-employed people under 67 who file a tax return, and members of a professional pension fund (Versorgungswerk). A spouse without a right of their own gets support through their partner.
What it holds. Funds and ETFs, with or without a guarantee.
EU funds (UCITS), ETFs among them, up to risk class 5 of 7, and euro government bonds; no single shares. Or a standard account (Standarddepot) with all costs capped at 1 % a year, or a product that guarantees 80 or 100 % of what went in.
The payout. From 65, starting by 70 at the latest.
A pension for life, or a payout plan to at least 85, with up to 30 % as a lump sum at the start. Up to €6,840 a year can go in, €1,800 of it supported, and you can move to another provider on the way.
Riester. No new contracts after 2026; existing ones carry on.
Keep the old allowances, or tell your provider the new rules should apply. Open a new supported contract from 2027, and they apply to your old ones too.
Retiring outside the EU. The support is paid back.
Live outside the EU and the EEA when the payouts start, and the allowances and tax relief are repaid (§ 95 EStG). Moving away while you're still saving doesn't trigger it on its own.
-
Or save without the account
Big tax deductions with Rürup, pension insurance, or plain investing you can reach at any time.
Rürup (Basisrente). Large deductions, locked in until retirement.
Deductible up to €30,826 in 2026, together with your state pension contributions, so it suits the self-employed and high earners most. It pays only a monthly pension for life, from 62 at the earliest.
Private pension insurance. Look at the costs first.
With a guarantee or linked to funds, and without state support. Sales and set-up costs can be taken from the first five years' payments, so leaving early returns less than you paid in.
An ETF savings plan. No support, and no strings.
In an ordinary securities account the money stays yours to reach at any time, and nothing is paid back if you leave Germany. Gains are taxed under the flat tax as you go.
The other life stages
- New in Germany, or a first job here
- Moving in together, or getting married
- A baby on the way
- Settled, and building up
Primary sources checked on 26 October 2026: the statutes and official pages linked above.