By the end of 2023, the population of people aged 60 and above in China has reached 296.97 million, and it is expected to increase rapidly over the next decade. Old-age insurance has become one of the indispensable guarantees for old age. Do you know what factors affect the level of pension benefits?

The top five factors affecting the level of pension benefits are as follows:

First, the contribution base. The amount of money paid by insured individuals is linked to the contribution base. For example, the contribution rate for flexible employment is 20%, and the lower limit of the contribution base in Shandong Province this year is 4,416 yuan. According to the minimum base, a monthly payment of 883.2 yuan is required. The higher the contribution base, the more money paid, and consequently, the higher the pension benefit, which is understandable to everyone.

Second, the contribution period. The contribution period is a factor that is specific to the month, and each month of contribution will increase the pension by a certain amount. The contribution period can be understood as the length of time we contribute to the old-age insurance system. The longer the contribution time, the greater the contribution, and the higher the pension, which I believe everyone will agree with.

Third, the place of retirement. The development across different regions in China is indeed not yet balanced, with some areas having higher wage levels and higher consumption levels. If the pension for retired elderly is not higher, it would be relatively difficult to maintain the standard of living. Generally speaking, the pension level in first-tier cities is higher.

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Fourth, the retirement age. The earlier one retires, the longer the time to receive the pension, which is a principle that everyone understands. Therefore, when determining the pension, the state adopts a model where the later the retirement age, the smaller the number of months for calculation, thereby increasing the pension for those who retire later.

Fifth, the average social wage. The pension for retired elderly is to some extent linked to the average social wage, mainly to ensure the purchasing power of the pension for the retired. The higher the average social wage at the time of retirement, the higher the pension will be. Including the adjustment of pensions after retirement, it is actually adjusted due to the increase in the average social wage.

How can one receive the highest pension after contributing for 15 years?

According to the pension calculation formula, the pension benefits mainly consist of two parts: the basic pension and the personal account pension.① The basic pension part is equal to the social average wage of the year before retirement × (1 + the average contribution index of the individual) ÷ 2 × the number of contribution years × 1%.

Currently, the region with the highest social average wage of the year before retirement in the country is Shanghai. The social average wage for the year before 2024 has reached 12,307 yuan.

As for the individual's average contribution index, the average contribution index calculated according to the 300% tier of contributions will be higher. However, in reality, even in places like Beijing and Shanghai, the average contribution index calculated for the year will not be 3, even if contributions are made at the 300% tier. The main reason is that the upper limit determined by the social average wage of the year before the last year is used in the first half of the year. From January to June 2024, the upper limit of the contribution base in Shanghai is 36,549 yuan, which is only equivalent to an average contribution index of about 2.97. Therefore, the average contribution index for the whole year will also be less than 3.

For simplicity, assuming the average contribution index is 3, the result of receiving 30% of the social average wage of the year before retirement in Shanghai is as high as 3,692.1 yuan, and this is just the basic pension.

② The personal account pension part is equal to the balance of the individual's pension insurance account at retirement ÷ the number of months determined by the retirement age.

For example, this year in Shanghai, if contributions are made at the 300% tier, the personal account can accumulate 35,265.6 yuan. If contributions are made for 15 years, the balance will be 528,900 yuan. Due to the lower contribution base in the past and the accounting interest rate not keeping up with the growth rate of the social average wage, it is estimated that the balance of the personal account will be around 400,000 to 450,000 yuan.

The latest normal retirement age is 60 years old. If the balance is 450,000 yuan, the monthly personal account pension can be received for 3,237.4 yuan.

Adding the above two parts together, the monthly pension can reach 6,929.5 yuan.This is probably the highest level of payment in our country at present, requiring participation in the Shanghai insurance payment, the highest level of payment for 15 years, and retirement at the age of 60 to achieve it. #Top Headline Creation Challenge# #Social Security Payment for 15 Years#