Upper limit for the pension: The Foreign Pension Act regulates maximum earnings points

Upper limit for the pension: The Foreign Pension Act regulates maximum earnings points

According to a report by www.fr.de, the Foreign Pension Act has set an upper limit for retirement. According to the regulations of the foreign pension law, a married couple may not receive more than 40 earnings points for periods under the foreign pension law. The limit to the joint maximum value of 40 earnings points always applies if the FRG shares of both partners' pensions exceed 40 earnings points.

This regulation can have a significant impact on pensioners in Germany. One pay point currently corresponds to 36.02 euros in West Germany and 35.52 euros in East Germany. This cap on joint earnings points could mean that married couples with higher pension entitlements do not exceed this amount and therefore receive less pension. For some pensioners who have previously received a pension of up to 3,000 euros, this could mean a significant loss of income.

The Foreign Pension Act (FRG) was introduced in 1969 to ensure that foreign workers who have worked in Germany and then return to their home countries are also entitled to a pension. The FRG not only affects employees who were employed in Germany subject to social insurance contributions, but also their surviving dependents and foreign pensioners who already receive a pension from Germany and have moved abroad.

For the financial industry, this regulation could also mean that consultants in the pension and insurance sectors have to adapt to new challenges in order to provide their customers with the best possible advice. The calculation of pension entitlements and retirement planning should now also take into account the upper limit for earnings points according to the FRG.

It remains to be seen how the introduction of this cap will affect the bond market and the financial industry as a whole. However, it is clear that this regulation represents an important restriction for many pensioners in Germany and will impact their financial situation and future planning.