Pension Insurance in Germany 2026: State and Private Plans
What the statutory scheme pays, what changes with the 2027 reform, and how Riester, Basisrente and private plans compare for people working in Germany.
checkeverything.de Redaktion · Last updated: 16 August 2026
Pension insurance in Germany works in two layers. The state scheme is mandatory for employees: 18.6 percent of your gross salary goes to the Deutsche Rentenversicherung, half paid by you and half by your employer. The private layer is voluntary, and for most people it is not optional in practice, because the state pension alone replaces only part of your working income. This guide covers what the state actually pays in 2026 and how the private options compare, including what the reform changes from 2027.
Key takeaways
- Employees pay 18.6 percent of gross salary into the statutory scheme in 2026, split equally with the employer, on income up to 101,400 euros per year.
- One pension point is worth 42.52 euros per month since 1 July 2026, after a 4.24 percent increase.
- Five years of contributions are required before any regular state pension is paid (Section 50 SGB VI).
- The standard retirement age is 67 for everyone born in 1964 or later (Section 35 SGB VI).
- Riester contracts can only be signed until 31 December 2026. From 2027 the new Altersvorsorgedepot replaces them; existing contracts keep their subsidies.
How the German pension system is built
Germany organises retirement income in three layers. The first is the statutory pension (gesetzliche Rentenversicherung), a pay-as-you-go system that covers almost all employees automatically. The second is the company pension (betriebliche Altersvorsorge), which your employer may offer and which converts part of your salary into a retirement claim. The third is private provision: subsidised products such as Riester and the Basisrente, plus unsubsidised private pension insurance and ordinary investments.
The state layer carries most of the weight today, but the law itself only anchors a security level of 48 percent of the average wage for the statutory scheme (Section 154 SGB VI). Whatever lifestyle sits above that line has to come from the other two layers. Pensions are not the only compulsory cover here: if you drive, our car insurance guide for Germany explains the other one most households pay for.
How much state pension will you get?
The state pension follows a fixed formula set out in Section 64 SGB VI: monthly pension = pension points × access factor × pension-type factor × current pension value.
The formula looks technical, but the logic is simple. Earn exactly the German average wage for one year and you collect one pension point. The provisional average wage for 2026 is 51,944 euros (SVBezGrV 2026). Earn half the average, you get half a point. Since 1 July 2026, one point is worth 42.52 euros of monthly pension, up 4.24 percent from the previous 40.79 euros.
A worked example: 40 years of contributions at exactly the average wage produce 40 points. At the current value, that is 40 × 42.52 = 1,700.80 euros per month before taxes and health insurance contributions. Few careers run precisely at the average for four decades, so treat this as a reference point rather than a forecast.
Two thresholds matter for expats in particular. You need five years of contributions before any regular state pension is paid at all (Section 50 SGB VI), and the standard retirement age is 67 for everyone born in 1964 or later (Section 35 SGB VI). Earlier retirement is possible in some constellations, always with deductions.
For your own numbers, the reliable route is the official one: the Deutsche Rentenversicherung runs free online calculators and sends a yearly Renteninformation once you have enough contribution years. Its English-language portal explains both.
Is pension insurance mandatory in Germany?
For employees, yes, and you do not need to do anything. Your employer registers you, and the contribution leaves your payslip automatically. The rate has been 18.6 percent since 2018. In 2026 it applies to gross income up to 8,450 euros per month; income above that ceiling is contribution-free. At the ceiling, the employee share works out to about 786 euros per month, matched by the employer.
Self-employment is more varied. Some groups, such as certain craftsmen and teachers, are required to contribute. Many others are not, and can join voluntarily. If you are self-employed and new to Germany, it is worth clarifying your status early, because voluntary contributions can also help you reach the five-year minimum.
Private pension options in 2026
| Product | Who it suits | State support 2026 | Main limitation |
|---|---|---|---|
| Riester pension | Employees, families with children | 175 € base allowance per year, plus 300 € per child born since 2008 | New contracts only until 31 Dec 2026; strict payout rules |
| Basisrente (Rürup) | Self-employed, high earners | Contributions deductible up to 30,826 € (single) / 61,652 € (married) | Lifelong annuity only, no lump sum, no early access |
| Private pension insurance | Anyone wanting flexibility | No direct subsidy; favourable payout taxation under conditions | Returns depend on the tariff; costs vary widely |
| Company pension (bAV) | Employees whose employer offers one | Contributions flow from gross salary | Tied to the employer; check conditions before relying on it |
The Riester allowances come straight from the law: 175 euros base allowance (Section 84 EStG) and 300 euros per child born after 31 December 2007 (Section 85 EStG). The Basisrente deduction ceiling follows Section 10 EStG and is recalculated each year from the miners’ scheme contribution ceiling; for 2026 that produces 30,826 euros for singles and twice that for married couples filing jointly.
Private pension insurance without subsidies is the most flexible of the group. You choose the contribution, you can usually pause or adjust it, and a capital payout is possible instead of a lifelong annuity. The trade-off is that nothing is subsidised and the quality spread between tariffs is wide, which is exactly why comparing offers matters more here than with the standardised products. If you first want a liquid buffer before committing to decades of contributions, a savings account comparison is the simpler starting point.
The 2026 reform: last year of Riester, first year of the Altersvorsorgedepot
The Bundesrat approved the reform of subsidised private pensions in May 2026, and the law takes effect on 1 January 2027. From that date, no new Riester contracts can be concluded. In their place comes a new product family, with the Altersvorsorgedepot at the centre: a tax-subsidised retirement account that can invest fully in shares, funds and ETFs, without a guarantee requirement. Products with 80 or 100 percent contribution guarantees remain available for savers who want them.
Existing Riester contracts are protected. If you already have one, you can keep saving in it with the current allowances. There is no obligation to convert.
What does that mean in practice this year? If a Riester contract fits your situation, 31 December 2026 is a real deadline. If it does not, there is no reason to rush into one just because the door is closing; the successor products arrive in January with their own conditions.
What happens to your pension if you leave Germany?
Your contributions do not disappear. Within the EU and EEA, insurance periods are coordinated: years worked in Germany count toward meeting minimum periods elsewhere, and Germany pays its share of your pension abroad when you retire.
Outside the EU, the answer depends on social security agreements. Nationals of countries without such an agreement can, under Section 210 SGB VI, apply for a refund of their own contributions once 24 calendar months have passed since leaving compulsory coverage. The employer share is not refunded, and a refund ends all claims from those years, so it deserves a careful decision rather than a quick one. The Deutsche Rentenversicherung publishes English-language guidance on both routes.
Closing your personal pension gap
The statutory scheme anchors 48 percent of the average wage. Your own gap is the distance between the state pension you can realistically expect and the income you want at 67, and it is different for every career path, especially if you arrived in Germany mid-career with fewer contribution years. Health costs belong in the same calculation: our guide to private health insurance in Germany explains the rules that apply once you retire.
A private plan is the usual way to close that distance. Which type makes sense depends on your employment status, your tax situation and how much flexibility you need. Comparing several offers before signing is worth the hour it takes: costs and conditions differ far more between tariffs than most people expect. And if you are already retired and looking at financing instead, our pensioner loan guide covers age limits and rates.
Compare private pension insurance offers
AdvertisingThis comparison calculator is provided by our partner. If a contract is concluded through it, we receive a commission.
The comparison is provided by our partner Tarifcheck and loads external content when opened.
Advertisement - Upon contract completion, we receive a commission. This does not affect the neutrality of our comparison.
Frequently asked questions
Is it mandatory to pay pension insurance in Germany?
For employees, yes. Enrollment is automatic and the 18.6 percent contribution is split equally between you and your employer. Many self-employed people are not required to contribute but can join voluntarily.
How much is pension insurance in Germany?
In 2026 the contribution is 18.6 percent of gross salary, levied on income up to 101,400 euros per year. The maximum employee share is therefore about 786 euros per month, with the employer paying the same again.
How much pension will I get after 5 years in Germany?
Five years is the minimum insurance period, and the amount depends on your earnings. As a rough anchor: five years at exactly the average wage earn five pension points, which is about 213 euros of monthly pension at the July 2026 value of 42.52 euros per point.
How many years do I have to work in Germany to get a pension?
Five years of insurance periods are required for the regular old-age pension (Section 50 SGB VI). Certain non-working periods, such as child-raising years, can also count toward this minimum.
What happens to my pension if I leave Germany?
Within the EU and EEA your German years are coordinated with your new country’s system and the pension is paid abroad. Non-EU nationals without a social security agreement can apply for a contribution refund after a 24-month waiting period (Section 210 SGB VI); this refunds only the employee share and cancels the claims from those years.
Can I still open a Riester contract?
Yes, until 31 December 2026. From 1 January 2027 the pension reform replaces Riester with the new Altersvorsorgedepot product family. Existing contracts continue with their current subsidies.
How can I check my German pension record?
Request your insurance record (Versicherungsverlauf) from the Deutsche Rentenversicherung or use its online services. The DRV also mails a yearly Renteninformation once you meet the minimum insurance years.
Sources and References
- •
- •
- •
- •
- •
- •
- •
- •
- •
- •