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Pension Tips

Part 2 - How does the UK state pension compare to other countries?


Profile Pensions
Profile Pensions

In part one of our articles looking at how UK state pension provision compares to the rest of the world, we looked at how the state pension is funded here, and in the US and Australia.

For more information on the UK state pension, have a read of our state pension guide.

Here, we look at state pension provision in Spain, Germany and France, as well as some of the ways you might be able to boost your income in retirement.

State pension in Spain

The state pension system in Spain is one of the most generous, with Spanish workers retiring on around 82% of their working wage on average, compared to the OECD average of 63%.

The system is funded by contributions to its social security system and to qualify workers must have paid Spanish social security contributions for a minimum of 15 years. To be eligible for the full amount, contributions must have been made for 35 years and six months.

The minimum age you can receive the state pension in Spain is 65 years and eight months and this will increase gradually to 67 years by 2027.

The minimum state pension in Spain in 2019 is €835.80 a month if you have a dependent spouse, or €677.40 if you don’t have a spouse and €642.90 if you have non-dependent spouse.

State pension in France

The French enjoy the longest retirement in the developed world, with a state retirement age of just 62.

However, retirees must have worked for 42 years before they can claim a full state pension. To receive any form of French pension you must have worked in France for at least 10 years.

French state pensions are funded by employer and employee social security contributions. At retirement, a maximum of 50% of average annual earnings can be drawn from the state pension, up to a limit of €39,732 per year.

Workers must also by law pay into supplementary pensions.

State pension in Germany

State pensions in Germany are funded by a system of compulsory pension insurance, with premiums deducted automatically from workers’ pay by their employers, who also contribute.

There is no statutory minimum or maximum pension, but a 2017 report from the Hans Böckler Foundation’s Institute for Economic and Social Sciences found that men on average get €1,154 per month (or €13,848 per year) versus just €634 (€7,608 per year) for women.

The age you can claim your state pension in Germany is 65, but this is gradually rising to 67 by 2029.

Average wage workers can expect to receive 50% of their working wage when they retire.

How much state pension are YOU entitled to?

If you’re approaching retirement, it’s a good idea to find out exactly how much UK state pension you might be entitled too, as well as how much you’re likely to get from any workplace or personal pensions.

You can use our pension calculator to help you see whether you’re on track for a modest or comfortable retirement.

If you’ve got several years to go before retirement, think about ways you might be able to boost your retirement savings. For example, you do not have to draw your UK state pension immediately, and if you’re able to delay taking it, the more you’ll receive once you do start claiming it. Your UK state pension increases by the equivalent of 1% for every nine weeks you defer, so if you defer to a year, this works out at just under 5.8%. So, if you’re entitled to the full state pension of £164.35 a week, and defer it for a year, you’ll get an extra £493 a year. For more information, have a read of our state pension guide.

If you’ve got a workplace or personal pension, can you afford to top up any contributions you make? Even if you can’t, you might be able to get more from your pensions by making sure you’re not paying over the odds in charges. Learn more about this in our blog Check your charges.