In modern society, pensions play an important role in ensuring social welfare, providing workers with a stable income when they are no longer able to work. Below are the most detailed and comprehensive information provided by LawPlus regarding pension regulations under the current laws.
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1. Pension – An Important Income for Workers
A pension is a monthly amount paid to workers after they retire, provided they meet certain conditions regarding their social insurance contribution period and retirement age. This income is generated from the worker’s participation in the social insurance system, aimed at supporting their livelihood in old age.
Receiving a pension not only ensures workers can live independently without relying on their children or relatives but also helps ease the social burden of caring for the elderly. For each individual, the pension is the result of a lifetime of work and contributions to the insurance fund, reflecting an awareness of securing future living conditions.
2. Factors Affecting Pension Amounts
The amount of pension a worker receives can vary, depending on several important factors:
First, the length of time contributing to social insurance.
The longer a worker contributes to social insurance, the higher their pension entitlement will be. According to the current legal regulations, male workers need to contribute to social insurance for at least 20 years, while female workers need to contribute for 15 years in order to qualify for the minimum pension rate. If this period exceeds the minimum threshold, the pension amount will increase, but it cannot exceed the legal limit.
Second, the average monthly salary used for insurance contributions.
The higher the salary on which contributions are made, the larger the pension. This average salary is calculated based on the total wages paid for social insurance contributions divided by the total number of months of contribution.
Third, the pension rate.
The pension rate is determined by the number of years a worker has participated in social insurance and their gender. This rate increases with the length of the contribution period and reaches a maximum percentage as prescribed by the law. Workers who retire before the prescribed age will have their pension rate reduced, while those who work in hazardous conditions may enjoy special benefits.
Additionally, some other factors may influence the pension amount, such as policies prioritizing specific groups, harsh working conditions, or cases of reduced work capacity.
3. How to Calculate Pension Amount
According to the current law (before July 1, 2025):
The monthly pension of a worker is calculated as 45% of the average monthly salary used for social insurance contributions corresponding to 20 years of contributions for male workers and 15 years for female workers. After each additional year of contribution, workers are entitled to an additional 2%, up to a maximum of 75%.
Amendment to the 2024 Social Insurance Law
The 2024 Social Insurance Law, effective from July 1, 2025, introduces important changes aimed at expanding the beneficiaries and improving the benefits for workers. One of the notable changes is the regulation on pension amounts for male workers who have contributed to social insurance for 15 to less than 20 years. This adjustment is highly humanitarian, making it easier for workers with shorter insurance periods to qualify for pension benefits.
Specifically, according to Point b, Clause 1, Article 66 of the 2024 Social Insurance Law:
“If male workers have contributed to social insurance for at least 15 years but less than 20 years, their monthly pension will be 40% of the average monthly salary used for social insurance contributions as stipulated in Article 72 of this Law, corresponding to 15 years of contribution. After that, for each additional year of contribution, the pension will increase by 1%.”
This regulation ensures that male workers who have contributed to social insurance for less than 20 years can still receive a pension, rather than having to meet the previous 20-year minimum requirement. This is especially significant for workers who have worked in difficult conditions or had to retire early due to health, family, or unstable work conditions.
Pension Calculation Table for Workers under the 2024 Social Insurance Law (from July 1, 2025)
After the amendment, the monthly pension for male workers will be calculated as follows:
According to the table, male workers who contribute for 15 years will receive 40% of the average monthly salary for social insurance contributions. Starting from the 16th year of contribution, each year will increase the pension rate by 1%, up to the legal maximum.
This change not only aligns with current realities, where many workers have not yet reached the 20-year threshold but also encourages early participation in social insurance to secure long-term benefits for old age. From July 1, 2025, workers can be more confident about their retirement benefits, even if their insurance contribution period is shorter than before.
4. Conditions for Receiving a Pension
To be eligible for a pension, workers must meet several basic conditions:
First, the retirement age requirements.
According to the social insurance law’s retirement age increase schedule, the retirement age for both male and female workers will gradually increase, depending on working conditions and gender.
Second, the required contribution period.
Male workers must contribute to social insurance for at least 20 years, while female workers must contribute for at least 15 years.
Additionally, other conditions apply in specific cases, such as retiring before the prescribed age or total work incapacity. Meeting these conditions is necessary for workers to receive pension benefits as prescribed by law.
A pension is not only an essential social welfare benefit but also the result of a worker’s long-term contribution to society. To ensure maximum benefits upon retirement, workers should adhere to legal regulations and keep track of new policies. A long-term, stable insurance plan is the key to a peaceful and sustainable life in old age.
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