How to Retire: 12 Steps (with Pictures)

2024 Author: Samantha Chapman | [email protected]. Last modified: 2023-12-17 09:13

The Italian pension system is rather complex, also due to the reforms that have taken place in recent years in order to make ends meet with INPS. Since 1996 our country has adopted the contribution system, which means that the extent of your pension will depend on the amount of contributions you make during your working life. This article is intended to offer an overview of the requirements for retirement.

Steps

Part 1 of 6: The Old Age Pension

Step 1. Reach retirement age and contribution years

The old-age pension, as the name suggests, focuses on the age requirement. In order for the system to be sustainable over time, the threshold age is expected to be periodically adjusted on the basis of statistics on average life expectancy.

• If you started working when the contribution system was already in place, i.e. from 1 January 1996 onwards, you can retire when you finish seventy years and three months (except for increases due to the adjustment of life expectancy), and you can boast at least five years of effective contribution (with the exclusion, therefore, of the periods of notional contribution). You can retire earlier under the same conditions that we will see for those who started working before January 1, 1996, provided that the amount of your pension is equal to at least one and a half times the amount of the social allowance. The social allowance is currently equal to 447.61 euros per month, so your pension (calculated entirely with the contribution system) must be at least 671.41 euros per month. If not, you have to wait.

  

• If you started working before January 1, 1996 you can retire at the age of 66 years and three months (except for increases due to the adjustment of life expectancy) with twenty years of contributions (also figurative). For women who are not public employees there is a transitional regime, whereby the retirement age will be fully equalized to that of men only from 1 January 2018. In particular, employees in the private sector from 1 January 2014 as of 31 December 2015 they can retire at the age of 63 years and nine months; from 1 January 2016 to 31 December 2017 they can retire at 65 years and 3 months, while self-employed workers belonging to the separate management from 1 January 2014 to 31 December 2015 can retire at 64 years and 9 months and from 1st January 2016 to 31st December 2017 aged 65 and 9 months.

  

Part 2 of 6: The Early Retirement

Step 1. Reach the required contribution years

The early retirement is characterized by placing the main emphasis on the contribution years, rather than on the age. The contribution years are different for men and women: men must mature at least 42 years and six months of contribution and women 41 years and six months. As with the old-age pension, the number of contribution years required may also vary in the event of an increase in the average life expectancy. If you retire before the age of 62, you suffer a reduction in the amount of your pension equal to one percentage point for each year in advance (up to two), and then by two points for each subsequent year. So for example, if you decide to retire at 60, you will suffer a decrease of two percentage points, but if you retire at 59, the decrease will be 4%, at 58 years of 6%, and so on.

• If you started working after January 1, 1996, you can retire early when you reach the age of 63, with 20 years of effective contribution (therefore excluding the notional contribution), provided however that the amount of the pension is equal to 2, 8 times the size of the social allowance. Which means that, to date, it should amount to at least 1,253.31 euros per month. If it is below, you have to wait.

  

Part 3 of 6: Disability Allowance and Disability Pension

Step 1. Understand the difference between disability and disability

For retirement purposes, disability is a condition of physical or mental illness that does not exclude, but only limits your ability to work. Disability, on the other hand, consists in that condition of infirmity that totally and permanently excludes your possibility of working (100% disability). Disability gives you the right to a benefit called ordinary disability allowance and does not exclude the possibility that you can also work. Inability gives you the right to receive an incapacity pension, but it is paid as long as you stop any work activity.

Step 2. Reach the contribution requirements

To get the disability allowance or disability pension you must have worked as an employee or self-employed and accumulated contributions for a total of five years (or 260 weeks) in total, of which at least three years (156 weeks) must have been achieved in the past five years.

Step 3. Carry out the medical examination

First of all it is necessary to obtain a certificate from a certifying doctor recognized by INPS, who will send the certificate directly to INPS via the internet. Once you have submitted your application, you will be subjected to a medical evaluation again.

Step 4. Ask for confirmation of your check within three years

The disability allowance is temporary and lasts for three years. By the deadline you must ask for confirmation and the permanence of your disability will be checked. After three consecutive confirmations, the check becomes final. Upon reaching retirement age, the allowance is automatically converted into an old-age pension.

Part 4 of 6: The Survivor's Pension

Step 1. Understand the difference between the survivor's pension and the indirect pension

• The survivor's pension is awarded to the relatives of a person who was already retired at the time of death.

• The indirect pension is attributed to the relatives of a worker who, at the time of death, has accrued contributions for at least 780 weeks (i.e. fifteen years) or 260 weeks of contributions (i.e. five years), of which at least 156 weeks in the last five years. However, in the absence of the minimum contribution, it is possible to request an indemnity.

  

Step 2. Check if you are among the eligible relatives

Survivors' pension is due:

• To the surviving spouse. The pension is usually also due to the separated spouse, but in the event that there has been a ruling against him, he will be entitled to a pension only if he has been recognized the right to alimony with a judicial measure. The divorced spouse is entitled to a pension only if he / she has a divorce allowance.
• To minors, incapacitated children or students (including university students) fiscally dependent on the deceased. Legitimate children are equated with legitimate children, adopted or affiliated, natural, legally recognized or judicially declared, born from a previous marriage of the other spouse;
• To underage grandchildren if they are the sole responsibility of the grandparents.
• To dependent parents, if they are at least 65 years of age and do not have a pension and as long as there are no other beneficiaries;

• To unmarried and incapacitated brothers and sisters who are dependent on the deceased, provided that there are no other entitled persons.

  

Part 5 of 6: The Social Check

Step 1. Check if you qualify

The social allowance, once called a social pension, is paid to people who are at least 65 years old and three months old and have an income below a certain minimum threshold (currently 5,818, 93 euros per year). To those who have no income, the check (currently set at 447, 61 euros per month, for thirteen months) is paid in full. Those with an income, on the other hand, are paid a check to the extent that they reach the minimum threshold. So if, for example, your annual income is 3,000 euros, INPS will pay you the remaining 2,818.93 (divided into thirteen months) that are missing to reach the income threshold. In case you are married, your spouse's income is also considered, but the threshold income is doubled (today the doubled amount is 11,637.86 euros). The permanence of the income requirements is verified every year.

If you are a foreign citizen, you can be entitled to the social allowance only if you have been resident in Italy for at least ten years, without interruption. If you are a non-EU citizen you must have a long-term residence permit

Step 2. Stay in Italy

Unfortunately, it is not possible to go and live in some country where life costs less, trusting in the social allowance. If you stay abroad for more than thirty days, your check is suspended. If you stay there for more than a year, your check will be revoked.

Part 6 of 6: The Pension Calculation

Step 1. Understand the difference between salary calculation and pension contribution calculation

Until 1995, ours was a paid pension system. The pension was calculated taking into account the average income earned in the last years of work (with the appropriate revaluations). Then the average income was multiplied by a coefficient (2%) as well as by the number of contribution years, for a maximum of 40 years. In this way, the maximum pension that could be obtained was equal to 80% of the average income of the last working years. In the contribution system, however, what matters is the amount of contributions paid. Unfortunately the system is too complicated to do the calculations yourself, but on the INPS website it is possible to use a calculator within your private area

Step 2. Consider making the option for the contributory system

If you started working on January 1, 1996, your pension is fully calculated using the contributory method. If you started working earlier, your pension will be calculated partly with the contribution system, and partly with the salary system. However, it is possible to make the option to fully subscribe to the contribution system if, on the first of December 31, 1995, you had already accrued at least five years of contributions and no more than eighteen. As a rule, however, the option for the contribution system will not be economically viable.

Advice

Contact a patronage for more information and advice on how to get around. The patronates can also submit the pension application in your name and follow the related practice

Warnings

• This article does not in any way constitute advice and merely pursues information purposes on the basis of the information currently available.
• If your pension application is rejected, contact a lawyer as soon as possible. The patronages will know how to refer you to a specialist in the subject.