This has a series of advantages and disadvantages that must be evaluated before making the decision to opt for one or the other alternative. If we want to have a higher pension at the time of retirement, we have to contribute on a higher basis , since the minimum will also result in the minimum pension. When the last 15 years of contributions were taken into account for the calculation of the pension, what many did was increase the contribution base in those last years to improve the pension they would receive. As the number of years of contributions for the calculation is extended, this no longer makes much sense.
The self-employed quote
The advantage of a public pension is that it will always be the same , if the current system is maintained, regardless of the years of life we have left once we have retired. In other local marketing email list words, it makes no difference whether we live five years more or twenty years after retirement, we will always receive our money, whereas a pension plan involves a finite amount of money saved and that we ourselves have to manage.
Increasing the contribution base also means increasing the monthly self-employed fee . Let's suppose that we are now paying contributions based on the minimum base of €884.40 and we want to move to a base of €1,500 with the aim of improving our pension in the future. This means that if we apply the common rate of 29.8% we will go from paying €263.55 to Social Security each month to paying €433.50. This difference between the costs of one base or another is what we have to evaluate to see if it is more profitable for us, whether to add it to our contribution base to improve our public pension or invest it in a private plan.
The difference will be around €2,000 per year , which we would invest in a private pension plan or in improving the pension we would have in the future. The decision is not easy. Sometimes you simply cannot pay a higher amount because you can barely make ends meet. By increasing the contribution to €1,500 as a base, we can end up with a pension of around €1,000 in twelve payments, although it will depend a lot on the years we have paid contributions on that basis and the age at which we retire. Social Security allows us to use a simulator to make a calculation based on the data we provide.
