How does the size of your pension depend on your length of service? Does the size of the pension depend on length of service?

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Does the pension depend on length of service?

The influence of the length of work experience on the size of the pension should not be overestimated. We should talk about it only in cases where we are talking about a really long period of work. You can count on the provision of additional payments and upward recalculation only if you have 40 years of experience.

The size of pension provision is influenced to a much greater extent by another indicator. This is the amount of deductions from the salary that the employer constantly makes. The amount of transfers depends on the salary received by the employee.

Considering the criterion for length of service, it should be noted that the supplement to the regular pension depends on:

categories of work performed;
location of the employing organization;
receiving bonuses.

The rates are different for women and men. Thus, 30 years of work experience for a woman and 35 years of work for a man give the right to one point in the additional payment system. If they worked for 40 and 45 years, respectively, then each has the right to receive 5 additional points.

In 2018, one point corresponds to 78.58 rubles. The Russian government, taking into account the inflation process, promises a regular increase in the value of pension points. This is how the state maintains guarantees for pensioners.

It is important whether the citizen continues to work. In recent years, pension supplements for non-working pensioners have remained at the same level. For those who continue to work, this indicator also does not change. In the near future, it is planned to increase the amount of allowances for citizens who have not stopped working.

The amount of the assigned pension can be slightly increased if you apply for it later. In this case, points accrued for the period when the citizen could receive a pension, but did not apply for it, will be taken into account. Accrual with their calculation will make the amount of security higher.

What length of service is taken into account when calculating?

During the Soviet period and until 2002, pensions were assigned based on the length of the employee’s total length of service. In 2002, a new procedure prescribed that calculations should be based on the amount of insurance contributions to the fund.

Currently, the Federal Law “On Insurance Pensions” N 400-FZot dated December 28, 2013, applied since 2015, is in force. He introduced a different procedure for calculating payments to citizens, different from the previous one.

The basis of the new policy was the delimitation of the total length of service from the insurance period.

Their difference is as follows:

total length of service is the summed time of the citizen’s activity period, during which the employer made contributions to the Pension Fund;
insurance period is all the periods during which the organization contributed the necessary amounts to pension insurance. This also includes periods when the citizen did not work, but payments were made. It is important to take into account not only the period of work on the territory of Russia, but also activities outside its borders, accompanied by the transfer of contributions.

The longer the period of regular contributions, the higher the assigned pension.

The concept of total length of service is no longer of decisive importance. This indicator applies only to persons who worked before the introduction of pension reform in 2002.

To find out the size of the pension, you will have to calculate the length of service.

This is done as follows:

First, the person’s work activity in the period up to 2015 is considered. To calculate the length of service, the rules in force at that time period are applied, using existing benefits;
Next, the citizen’s working time from the moment Law No. 400-FZ came into force is considered. A new order is used here.

Know! Certain types of activities provide employees with additional guarantees. For example, they allow you to receive pension benefits earlier than others. Example: having teaching experience.

Requirements for length of service when calculating pensions

Until the Law of the Russian Federation No. 400-FZ began to be applied, to receive a pension it was enough to have 5 years of experience. The new rules tighten existing requirements, constantly increasing the minimum duration of work.

In 2015, the mandatory length of service to receive a pension was recognized as 6 years, in 2016 it increased to 7 years, and in 2018 to 8 years. This figure will grow every year and by 2025 will increase to 15 years. At this point it is planned to stop making changes.

Today, the conditions for pension provision are as follows. If a person’s work experience is at least 35 years, and the salary level is close to the national average, the citizen has the right to apply for a labor pension.

Its minimum amount will be 40% of the average salary. The exact size of the applied coefficient is determined by the length of service.

Important! The more experience a person has, the higher the coefficient when assigning a pension. Also, the later a citizen applies for its assignment, the higher the size of the pension.

Periods of incapacity that are taken into account

The insurance period includes some periods when the person did not actually work.

They are taken into account in the simultaneous presence of the following circumstances:

the citizen worked before or after the end of the specified “non-work” period;
During this time, contributions to the Pension Fund were regularly paid.

These time periods include:

service in the Armed Forces;
caring for a citizen with group 1 disability;
caring for a disabled child under 18 years of age;
care for a citizen over 80 years of age;
for military wives - the time when they were forced to stay at their spouse’s place of service, where there was absolutely no opportunity for employment;
for spouses of employees of consulates and other diplomatic institutions - time spent in another state. It is important to stay outside Russia due to business needs;
the time when the person was officially recognized as unemployed and was registered with the Employment Service with the accrual of the corresponding benefits;
the period of serving an illegally imposed sentence associated with deprivation of liberty. Official recognition of the wrongful conviction of a citizen is necessary.

Watch the video. About the rules for calculating pensions:

Selected cases of employment

The law obliges the following periods of work to be included in the length of service that affects the calculation of a pension:

during the probationary period when applying for a job. Art. 79 of the Labor Code of the Russian Federation indicates that it does not matter what type of contract was concluded during employment;
working time on a part-time basis. A citizen’s employment does not matter; he has the right to work at 0.5 or 0.3 rates. The main thing is to regularly make contributions to the fund;
if a person works part-time, only information about the main place of work is included in the length of service. But if contributions were transferred by two employers, their amount is summed up. Increasing contributions also increases your pension. Also in this case, the presence of special types of experience is taken into account.

Continuity of experience

The previous procedure for calculating payments took into account the criterion of continuity of service. This term means the period of work of a person in one or more organizations, if the period between dismissal from the previous place and placement in a new one was no more than a certain interval. It ranged from 30 to 90 calendar days and was applied depending on individual situations.

Previously, having continuous work experience made it possible to receive a higher pension. Now this indicator is practically unimportant, since only transfers made to the Pension Fund are taken into account.

Pension if no experience

If a citizen’s length of service does not reach the established minimum limit or is absent altogether, he is not entitled to an insurance pension. But at the same time, the person is not left without payments from the state. A social pension is used, which is significantly less than the insurance pension.

The condition for obtaining it is to reach a certain age limit. For men it is recognized as 65 years, for women it is 60 years.

When can a surcharge be assigned?

In some cases, length of service allows you to make an additional payment to your pension.

This is possible under the following circumstances:

the pension was previously assigned without taking this period into account. Usually the reason is the lack of documents necessary for confirmation;
the citizen receives a pension, but has not stopped working;
the length of service allows a person to obtain the status of “labor veteran”.

The first two cases require recalculation. If the person continues to work, such recalculation occurs annually, starting on August 1. The basis for this is the amount of insurance contributions transferred by the employer. In this case, an application from a pensioner is not required.

If a person managed to obtain additional documents indicating the period of work, a recalculation will be made based on his application. It should be submitted to the Pension Fund office that calculates the citizen’s pension. A separate file is drawn up for each pensioner.

The title of labor veteran also entitles you to receive an increased pension. For women, at least 35 years of experience is required, and for men, at least 40 years. The supplement is assigned by the social security service according to the person’s place of residence.

A prerequisite for additional payment is reaching the age that gives the right to an old-age pension. Also, citizens with a long work history may have other benefits, some of which are financial in nature. Their appointment and regulation are carried out by regional authorities.

The amount of the surcharge is determined by its category. Some are installed individually. If important circumstances were not taken into account when assigning a pension due to failure to provide certificates, such documents may be submitted later. In this case, they will become the basis for recalculation based on insurance premiums.

Attention! Our qualified lawyers will assist you free of charge and around the clock on any issues.

The assignment of the title of labor veteran is accompanied by the assignment of an additional payment in a fixed amount. But this value varies depending on the place of residence of the person. This payment is financed by the local budget, and it is established at the regional level.

As examples, consider Moscow and St. Petersburg.

In St. Petersburg, labor veterans in 2017 received a monthly supplement in the amount of 828 rubles. and enjoyed the following benefits:

reduction in housing costs by 50%;
payment of utilities in the amount of 50%;
the ability to use a single travel ticket for various types of urban transport (bus, trolleybus, tram, metro);
reduction in fares on commuter buses and trains from the end of April to the end of October.

For your information! In Moscow, labor veterans are provided with free travel on suburban railway transport.

They also enjoy the following benefits:

monetary compensation to pay for city telephone communications;
free dental prosthetics;
receiving free vouchers to sanatoriums for medical reasons to restore health.

Every month this category of Moscow residents is entitled to a payment of 495 rubles.

To obtain the status of a labor veteran, you must confirm that you have a work experience of 35 years for women and 40 years for men. Only in this case will a citizen be able to qualify for an additional payment to the regular pension.

Social protection authorities are responsible for processing additional payments. The Pension Fund does not have such powers.

When applying for additional payment, you must provide:

application for payment;
passport of a Russian citizen;
a certificate from the Pension Fund confirming receipt of an old-age insurance pension;
certificate confirming the status of a labor veteran.

Pension legislation in our country is changing. Moreover, several times, from January 1, 1992, from January 1, 2002, and also from January 1, 2015, cardinal changes were carried out - in fact, the procedure for calculating length of service and the amount of pension, or, as they often say, the pension formula, seriously changed. But a person earns a pension throughout his working life, so when the time comes to assign it, different periods of his biography are taken into account differently. What and how changed Until 1998, the de facto Soviet order was preserved: the size of the pension was calculated based on the total length of service and the average salary. The salary was taken according to one of two options: for the last two years of work or any five years in a row when earnings were the highest. This was stated in pension law N 340-1, which was in force at that time. It should be taken into account that there was an upper limit on the size of the pension.

How does the size of your pension depend on your length of service?

Thus, the longer your experience and the later you retire, the higher the coefficient will be that affects your salary. Periods of incapacity for work taken into account when calculating pensions As mentioned earlier, the insurance period includes a number of periods that are not considered labor periods.

Therefore, they affect retirement. But it is important to note that such periods are taken into account only if two conditions are met:

The person additionally carried out labor activities before or after the specified period.
The corresponding contributions to the Pension Fund of the Russian Federation were paid to the state.

The periods included in the length of service include: 1. The period of military service. 2. Care for:

adults with the first group of disabilities;
a minor child who has disabled status;
an elderly person over 80 years of age.

What is length of service and how is it taken into account when calculating pensions?

It is worth noting that length of service does not affect the size of the pension when it comes to social benefits, which are assigned to mothers of many children, people with disabilities, and residents of the Far North. The disability pension is paid on the basis of a certificate of completion of the ITU.

Residents of the Far North and neighboring areas can retire early. In addition, there is a list of categories of citizens who can receive preferential benefits before reaching retirement age.
In some cases, the duration of work does not affect the amount of the pension. As a rule, these are people who work in high-risk conditions (miners, divers, emergency workers, etc.).

Important

Medical employees and teachers can also count on preferential payments. Early pension accrual occurs at least 2 years before retirement.

Does the size of the pension depend on length of service: all aspects

This limit was limited very simply: the maximum pension could not be higher than 3.5 times the minimum pension. In February 1998, Law No. 113 came into force, which introduced into Law No. 340-1 an alternative procedure for calculating pensions using the so-called individual pensioner coefficient (IPC), which was calculated as the ratio of a pensioner’s earnings and the average salary in the country, but could not be above 1.2.

Since January 2002, the insurance principle of assigning pensions was introduced. According to Law 173, a person’s right to a labor pension arose depending on the insurance period - the time when insurance contributions to the Pension Fund were paid from earnings.

Two options - optional Until 2002, the total length of service was used to calculate the pension.

What determines the size of the old-age pension?

Although the formula for calculating a pension is complex, it exists. And I analyzed this formula before. Well, the accrued pension depends on the length of service due to the length of service coefficient being taken into account. Of course, employees do not calculate everyone’s pension on a calculator, but there is a program, the main thing is to enter it correctly It contains all the individual data, including the average salary for a certain period, in order to then calculate the salary coefficient. It also has its own rules. And the experience coefficient starts at 0.75 for women with 20 years of experience, and then adds 0.01 for each year after 20 years for women, and 25 years for men. Maximum up to 0.95. That is, experience after 40 years before the lightbulb. Then these two coefficients are multiplied and multiplied by a certain amount and added to the main part of the pension.

A year and a half

In such situations, pension savings do not increase in any way, because the employer does not pay taxes on such income, including contributions to the pension fund. Important! The length of service affects your pension. The higher it is, the greater the amount of contributions made for the PF employee. What needs to be done to receive a good pension When the question arises of how length of service affects the size of a pension in Russia, every person must understand that in order to receive a good pension, he needs to adhere to the basic rules:

Get an official job and insist on receiving white wages.
Find a job with a high level of official income. After all, the more contributions the employer pays for it, the larger the pension will be.
And contributions are paid as a percentage of salary.
You can continue to work after reaching retirement age.

How does the size of the pension depend on the length of service and the amount of salary?

These usually include:

Military service
husband serves under contract in an area where a woman cannot have a job
sick leave
maternity leave for up to one and a half years, in general, no more than six years
period of assistance to elderly people over eighty years of age
time to receive unemployment benefits

Insurance length of service Thus, when calculating and assigning pension payments, length of service is a fairly important indicator. It is also closely related to insurance premiums paid.
According to the current pension reform, the minimum length of service for retirement is the same for both men and women. There are special formulas for calculating it. How length of service affects the size of the pension in 2017 can be understood by reading the legislation.

How does length of service affect the amount of pension: the periods included in it

The calculation of length of service, which will then be used to calculate the amount of the pension, is carried out according to the following scheme:

At the first stage, data on a person’s employment until 2015 is taken, and based on previously existing rules, the length of service for a given period is calculated, taking into account the preferential procedure.
At the second stage, the duration of work activity after 2015 is calculated based on Federal Law No. 400.

There are also special types of internships that provide advantages to workers in a particular field. Pension payments: what determines the amount of your pension With its help, you can calculate your pension in just a few seconds, knowing only the size of your monthly salary.

In addition, based on the size of your salary, you can separately calculate the number of pension points you are entitled to per year.

How does a pension depend on length of service and official salary?

Attention

It is necessary to take into account as much as possible all the experience and salary available according to the documents, and it is better to do this in advance. The calculation does not include off-the-job study time.

Certain (other) periods are compensated by accruing points per year:

care for children under 1.5 years old - from 1.8 (first child) to 5.4 (third);
service in the army (other paramilitary units), caring for disabled people of group 1 and the elderly (over 80 years old) - 1.8.

Figure 1. Data on periods of work until 2001 according to an extract from an individual personal account. Information on accrued insurance premiums from 2002 to 2014 is shown in Fig. 2. Since this is a direct monetary amount, and not a calculated value, it cannot be changed. But it is worth checking the completeness of the entered data. Perhaps one of your employers did not submit information to the Pension Fund in a timely manner, then he will be required to make an adjustment. Figure 2.

The influence of length of service on the amount of pension

What length of service is taken into account when calculating pensions? From the times of the USSR until 2002, when retiring, the total length of service was taken into account. Then a new law was adopted, which provided for the calculation of payments based on insurance contributions.

The latest was the new Federal Law No. 400 “On Insurance Pensions”, adopted in 2015, which significantly changed the calculation mechanisms. How the general experience differs from the insurance experience, we will look further:

The total length of service of a citizen means the total time spent working, which was accompanied by contributions to the Pension Fund of the Russian Federation by the employer.
Insurance experience means the total time a person has worked in the territory of the Russian Federation.
In this case, not only the time a person works at the enterprise is taken into account, but also the so-called non-working periods during which deductions to the Pension Fund of the Russian Federation occurred. In the future, the time received is taken into account when calculating the citizen’s insurance pension.

You can get this information from the accounting department at your place of work, but you can also calculate the approximate size of your pension much faster and in a more convenient way. On the official website of the Pension Fund of the Russian Federation, an online service was created specifically for calculating pensions - a pension calculator.

How will salary affect the size of the pension in the future? It is for this reason that there are special calculators that require input values, such as length of service, the size of the “white” salary, and others, so that by substituting them into the formula, the result can be accurately displayed. They will help anyone calculate their pension quickly and reliably.

It is enough to answer a few questions. Fixed payments The pension also includes a fixed, guaranteed payment. To begin with, it is worth considering the size of the fixed payment; this is a kind of basic platform, the same for everyone.

The legal significance of total length of service for pension purposes is reduced. Previously, work experience was necessary both for the assignment of a pension and for its calculation. According to the law of the Russian Federation of November 20, 1990 “On State Pensions in the Russian Federation,” taking into account the total length of service, an old-age pension was established, and in appropriate cases, a disability pension and a survivor’s pension. For example, old age pension on a general basis, it was established for men upon reaching 60 years of age and with a total work experience of at least 25 years; women upon reaching 55 years of age and with a total work experience of at least 20 years. The size of the old-age pension depended on the length of total work experience. The pension was set at 55% of the average monthly earnings with the required length of service and increased by 1% for each full year of total work experience exceeding the required one, but not more than 20%.

An example of calculating a pension: a man’s total work experience was 40 years. The pension amount as a percentage of earnings will be 55% + 15% for 15 full years of service over 25 years. Only 70% of average monthly earnings.

Currently, total length of service is not required to assign labor pensions. In accordance with the new pension legislation, one of the main conditions for acquiring the right to a labor pension is the presence of insurance experience, that is, the total duration and other useful activities during which insurance contributions were paid to the pension fund of the Russian Federation, as well as other periods counted in the insurance period . The total length of service is necessary solely to determine the size of the pension for citizens who acquired it before January 1, 2002. To understand this, you need to refer to the relevant provisions of Federal Law N 173-FZ. In particular, Article 30 of this legal act describes the procedure for converting (transforming) pension rights (the value of which is related to the length of total work experience) into estimated pension capital.

In other words, the length of the total work experience depends on the length of service coefficient. The latter is necessary for calculating the estimated size of labor pension, which would be due to the insured person under the legislation in force on December 31, 2001. Pensions are calculated using the pensioner’s individual coefficient. The estimated pension amount is used to determine the pension capital as of January 1, 2002, which, together with the pension capital after January 1, 2002, forms the total pension capital. Thus, pension rights acquired before 01/01/2002 are converted into monetary terms. The amount of the total pension capital divided by the “survival period” forms the insurance part of the pension, which, together with the base part, makes up the size of the citizen’s pension.

(section "Useful book" dated May 28) the editorial office of "RG" received many letters and calls. “You write that the time spent studying at a technical school or university should be included in the length of service, but the Pension Fund refused me,” “they don’t want to count my time of military service in the army as 1.5 times the amount. Why?” These are just a few of the questions we are asked. "RG" forwarded them to the Pension Fund so that our readers received explanations, as they say, first hand.

But a person earns a pension throughout his working life, so when the time comes to assign it, different periods of his biography are taken into account differently.

What and how changed

Until 1998, the de facto Soviet order was maintained: the size of the pension was calculated based on the total length of service and average salary. The salary was taken according to one of two options: for the last two years of work or any five years in a row when earnings were the highest. This was stated in pension law N 340-1, which was in force at that time. It should be taken into account that there was an upper limit on the size of the pension. This limit was limited very simply: the maximum pension could not be higher than 3.5 times the minimum pension.

In February 1998, Law No. 113 came into force, which introduced into Law No. 340-1 an alternative procedure for calculating pensions using the so-called individual pensioner coefficient (IPC), which was calculated as the ratio of a pensioner’s earnings and the average salary in the country, but could not be above 1.2.

Two options - optional

Until 2002, total length of service was used to calculate pensions. But since 2002, according to Law 173, insurance premiums (calculated pension capital) began to be taken into account - accordingly, the time of studying at a technical school and university, and other periods when a person did not work and did not pay contributions fell.

At the same time, Law 173 (Article 30, paragraphs 3 and 4) provides for the possibility, when calculating the amount of a pension, to assess pension rights for periods before 2002 (and their conversion into pension capital) based on the estimated amount of the pension calculated according to the old rules, that is, according to Law 340, both with the use of the ICP according to Law No. 113 (clause 3), and without the use of the ICP (clause 4). As a result, the pensioner was automatically assigned a larger pension from two options for assessing pension rights acquired before 2002.

“Now for newly retiring citizens, the assessment of pension rights earned before January 1, 2002 is carried out by converting them into estimated pension capital,” explained the Pension Fund. “In this case, the option for assessing pension rights that allows the citizen to establish pension in the largest amount: in accordance with paragraph 3 or paragraph 4 of Article 30 of the Federal Law of December 17, 2001 N 173-FZ “On Labor Pensions in the Russian Federation”.

If pension rights are assessed according to paragraph 4 (that is, in fact, according to the old 340th law, without applying the ICP), then the total length of service includes:

If the pension capital is large according to the second calculation option (clause 3 of Article 30 of Federal Law No. 173), the above non-insurance periods are taken into account on a calendar basis or are not taken into account at all.

Today there are key factors on which the size of your future pension will depend. Tells about what influences its value Head of the department for organizing the assignment and recalculation of pensions of the regional Branch of the Pension Fund Zinaida Gubanova.

- Zinaida Lvovna, how does the future pension depend on the length of service?

When assigning a pension, insurance and total length of service are taken into account. The total length of service is determined until January 1, 2002. Insurance experience is the duration of periods of work and (or) other activities for which insurance premiums were accrued and paid to the Pension Fund of the Russian Federation. At the same time, there are so-called non-insurance periods that are counted in the insurance period: the period of caring for a child until the age of one and a half years, the time of caring for a disabled child, a disabled person of group I or a person who has reached the age of 80, the period of military service and some other. They also earn pension points. Work periods are confirmed based on individual (personalized) accounting information. If the accounting information contains incomplete information about periods of work, or there is no information about individual periods, the length of service can be confirmed with documents.

The longer the period during which insurance contributions to the Pension Fund were paid, and the higher the salary, the greater the amount of contributions reflected in the individual personal account of the insured person in the Pension Fund of Russia and the higher the insurance pension will be.

You can familiarize yourself with your pension rights, find out everything about your length of service, earnings, and the amount of insurance contributions without leaving your home, through the citizen’s Personal Account on the website of the Russian Pension Fund. Your rights are based on the data that the Pension Fund received from employers. If you think that any information has not been taken into account or has not been taken into account in full, contact your employer to clarify the data and submit it to the Pension Fund in advance.

- Is it important at what age you retired?

Yes, definitely. For each year of later application for an insurance pension after the right to it arises (including early), the fixed payment and the insurance pension increase by certain coefficients. These premium factors have different meanings for the fixed benefit and the insurance pension.

For example, if you apply for an old-age insurance pension five years after your right to it arises, the total pension amount may be approximately 40% greater.

- How can the size of the official salary affect your future pension?

It is very important to know that employer insurance contributions for compulsory pension insurance are paid only from white wages. With gray remuneration schemes, insurance premiums are either paid in a minimal amount or not paid at all. In these cases, funds for the formation of the citizen’s pension rights are not received or the future pension is formed in a minimum amount.

- Does anything depend on the pension option?

If a citizen forms a funded pension, then he is accrued fewer pension points annually compared to if only an insurance pension was formed. At the same time, the maximum number of pension points that can be earned in a year also varies. For those who form only an insurance pension, in 2021 this is 10 pension points, and for those who form both insurance and funded pensions - 6.25 pension points.

So, the future pension depends on the following four factors: the size of the official (white) salary, length of service, retirement age and the pension option that each citizen chooses for himself.

Media Relations Group of the PFR Branch in the Altai Territory