How long do people stay on welfare

Basic security: Since January 2021, new allowance of up to € 223

  • With the introduction of the basic pension periods, there are important changes in the calculation of the basic security in old age.
  • As of January 2021, the entire statutory pension is no longer taken into account as income.

More than a million people are dependent on basic security in old age and in the case of reduced earning capacity. So you have not enough money available to cover their basic needs and pay their rent. In 2021, the number of recipients of basic security in old age could increase significantly. Because by one new allowance that applies to the statutory pension, significantly more people are now entitled to social benefits.

Until 2020 only allowance for private pension

In the case of basic security in old age, the social welfare offices check how high the income is (minus health and long-term care insurance contributions) and how high the basic needs and the average rent are. If the income is below the sum of basic needs and rent, the office increases the amount.

The statutory pension has so far been fully taken into account. For private pensions, however, there has been an exemption of 100 euros since 2018. For example, if the beneficiary receives 100 euros from his Riester pension, this does not reduce the amount of the basic security.

In doing so, the state takes into account the beneficiary's efforts to ensure that he has saved up for retirement during his working life. So far, however, the fact that there is no corresponding regulation for the statutory pension has caused astonishment. “In 2021, the People who have basic social security benefits who could not afford to make private provisions are included in their life's work“, Comments, for example, the Schleswig-Holstein regional association of the Social Association Germany.

Who is entitled to the so-called Basic Security Plus in 2021?

Specifically, all people are entitled to the new allowance for basic security in old age who are entitled to 33 years of basic retirement come. These times have been added as part of the basic pension. In addition to the compulsory contribution periods for gainful employment, it also includes periods of child-rearing and care.

Whoever fulfills this requirement can count on one Exemption of at least 100 euros of his statutory pension to adjust. Every euro over this is taken into account at 70 percent, 30 percent is added to the tax exemption.

However, the surcharge is capped at 50 percent of the basic standard rate, which will be 446 euros in 2021. This means a maximum allowance of 223 euros.

Rule of thumb:

Every person who draws a gross pension of EUR 510 in 2021 receives the maximum allowance.