According to the provisions of the Social Insurance Law, as long as the accumulated payment of the pension insurance reaches 15 years, one can receive the basic pension on a monthly basis upon reaching the retirement age. However, in reality, the working years of people at retirement may vary greatly, such as 15 years, 20 years, and 30 years. How is the pension calculated for these different working years? Is it tiered every 5 years?

Calculation formula for pension benefits.

Participating in pension insurance, the pension benefits are mainly composed of two parts: the basic pension and the personal account pension. Some individuals, due to starting work earlier, participated in work before the establishment of the pension insurance personal account system in our country, or have deemed payment periods, their pension benefits will also include a part of the transitional pension.

The pension calculation formula in various provinces includes these three parts. The basic pension part and the personal account pension part are unified nationwide, while the transitional pension part varies by province. For example, here is the pension calculation formula for Beijing:

① The basic pension part is equal to the average social wage of the year before retirement × (1 + the average payment index of the individual) ÷ 2 × the payment period × 1%.

With a fixed average payment index, the result of the basic pension will definitely be different with different payment periods. For instance, with an average payment index of 0.6, and working years of 15, 20, and 30 years, one can receive 12%, 16%, and 24% of the average social wage, respectively. If the average payment index is 1, one can receive 15%, 20%, and 30%, respectively.

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There is indeed a significant difference in pension benefits for every 5-year payment period. Assuming the average social wage is 10,000 yuan, with an average payment index of 1, and working years of 15, 20, and 30 years, the basic pension can differ by 500 yuan and 1,000 yuan.

② The personal account pension part is equal to the balance of the pension insurance personal account ÷ the number of months determined by the retirement age for payment.

Please note that the translation provided is a direct translation of the original text and does not include any additional explanations or context that might be necessary for a full understanding of the pension calculation system.The balance of an individual's pension account is credited based on a certain percentage of the monthly contribution base. After 2005, it is 8%, and before that, it was 11%. Generally, before 1996, many places did not establish individual accounts.

Due to the lower average social wages in the earlier years, even with interest, there is a significant difference compared to the current balance generated by contributions. Therefore, the balance for contribution periods of 15 years, 20 years, and 30 years does not strictly increase proportionally.

Additionally, different retirement ages correspond to different calculation months for pension distribution. The commonly used ages are 50, 55, and 60, corresponding to 195 months, 170 months, and 139 months, respectively.

What about the years before the establishment of the individual account system? Transitional pensions are calculated for those years.

③ The transitional pension in Shandong Province is calculated as the previous year's average social wage × average contribution index × years before the establishment of the individual account × 1.3%.

There are three times for the establishment of individual accounts in Shandong Province: October 1994, January 1995, and January 1996, applicable to retirees in Qingdao, provincial enterprises, and other regional enterprises, respectively.

The calculation formula for transitional pensions in Shaanxi Province uses a transitional coefficient of 1.4%. As for the recognized contribution years, they can be determined according to local regulations. Especially for some employees of government and public institutions who transferred to enterprises before October 2014, these years of service can be audited as recognized contribution years based on the archives.

Considering the overall treatment, there is indeed a noticeable difference in pensions for service periods of 15 years, 20 years, and 30 years, but it is not divided into five-year increments. Instead, it is continuous and based on various factors such as the contribution base, contribution months, and retirement age. #Top Headline Creation Challenge#