Who wouldn’t like to retire early? In Spain, voluntary early retirement allows you to retire two years before the ordinary retirement age and up to four years before if retirement is forced. In other words, it is possible to retire at age 63 and even at age 62 in the best case scenario.
The key, as you see, is knowing what the legal retirement age is in Spain. The magic figure in 2023 is 66 years and 4 months of age for those who have contributed less than 37 years and 3 months to Social Security and 65 years of age for those who have worked for longer.
Furthermore, this goal line will increase over time until reaching 67 years of age and 38 years and 6 months of contributions. Again, those who exceed that contribution period will be able to retire at age 65. The rest? They will have to opt for early retirement if they want to stop working sooner.
Who can retire at age 63?
The legislation allows access to voluntary early retirement up to two years from the ordinary time of retirement. The translation is that, at the earliest, you will be able to retire at 64 years of age if you do so voluntarily, that is, as something premeditated.
Retirement at age 63 is only available when it comes involuntarily. In other words, it must be a forced retirement.
Among the requirements for non-voluntary retirement at age 63 is having contributed for at least 33 years, two of which must be within the 15 years prior to retirement.
Additionally, this option is only available to self-employed workers. The self-employed can only access voluntary early retirement.
Finally, for a forced retirement to be considered, the employment relationship must occur for reasons beyond the control of the worker. This means that you cannot leave your job and collect your pension. The company has to fire you or terminate your contract due to force majeure.
The only exception is when you leave work because you are not being paid your salary, the conditions have changed and represent a detriment to the worker’s dignity, or the employer is failing to fulfill its obligations.
What pension do you have if you retire at 63?
Retiring early always means giving up a part of the pension that corresponds to you, both in voluntary and forced retirement.
When this happens, Social Security applies a series of reducing coefficients on the pension that would correspond to you. These coefficients are higher the sooner you access retirement and also the less time you have contributed at that time.
How much is the pension reduced for retiring at age 63? The reducing coefficients in this case range from 22.5% to 18%. This is how they are distributed according to the period of contributions to Social Security:
Reduction coefficient of 22.5% for retirement with less than 38 years and 6 months of contributions. Reducing coefficient of 21% for early retirement with less than 41 years and 6 months (and longer than in the previous point). 19.5% for early retirement with less than 44 years and 6 months (and longer than in the previous point) Reducing coefficient of 18% for early retirement with more than 44 years and 6 months.
Once these coefficients are applied, the amount of the pension cannot be higher than the result of reducing the maximum pension by 0.5% for each quarter that retirement is anticipated.
The maximum coefficient to advance retirement by four years is between 30% and 24%.
In any case, the pension to be collected may not be less than the minimum contributory pension established by Social Security and which is currently 9,695 euros for a person with a non-dependent spouse and 12,682.60 euros for a person without a spouse.
