The time you have worked affects the calculation of retirement in Spain. Perhaps a quarter of a century seems like a long time, but when it comes to the public pension, having contributed for 25 years does not ensure that you can collect the maximum pension.
After 25 years of contributions to Social Security they will be entitled to a pension, but it will not even be for 100% of the regulatory base. We help you do numbers.
Can you collect the pension with 25 years of work?
In Spain there are two types of retirement pensions: the contributory pension and the non-contributory pension.
The first depends on your contributions to the system, hence its name. In order to access the contributory pension, it is necessary to prove a minimum period of 15 years of contributions to Social Security.
The non-contributory pension is different. It does not depend on how long you have worked, but on other factors such as living in Spain and having done so for a number of years.
If you have contributed to Social Security for 25 years, you will be entitled to receive a contributory pension. What you will not have the right to collect 100% of the regulatory base of that retirement pension.
This regulatory base is the sum of the last 300 months of contributions (25 years) divided by 350, although with the second part of the pension reform it will change slightly. With it, from 2027 Social Security will automatically choose the best option between the last 300 months of contributions or the last 25.33 years minus the worst months.
This is how the new option of calculating the pension with the last 29 years of contributions (348 months) minus the two worst years will be gradually implemented. The objective is that from 2041 all pensions are calculated with the new formula.
What pension remains if you have contributed for 25 years?
If with 25 years of work it is not possible to access 100% of the pension, what percentage of the regulatory base is charged? The calculation is much simpler than you may think.
With 15 years or 180 months of contributions, 50% of the personal income tax base is charged. From there, an additional percentage will be added for each additional month of work until reaching 100% at 36 years and 4 months. This figure will also have each year until reaching 37 years in 2027.
Specifically, for each more quoted month up to month 49, 0.21 points will be added to the regulatory base up to a maximum of 10.29%. The rest of the months will only add 0.19 points to the base. This means 71 months of contributions at a rate of 0.19 per month or 13.49% more in your contribution base.
In total, with 25 years of contributions they will be entitled to collect 73.78% of the regulatory base as a retirement pension.
By way of example, if the regulatory base is 2,500 euros per month, the pension will be 1,844.5 euros per month, provided that you retire at ordinary retirement age and do not do so early.
And it is that, advancing retirement also affects the calculation of the public pension.
This formula for calculating the regulatory base will be maintained until 2027, although the percentages vary slightly in the last year.
In any case, if the pension after contributing for 25 years is less than the minimum retirement pension, Social Security will apply a minimum supplement. This is how the system ensures that all recipients of a contributory pension receive the minimum pension.
