Pensions will rise from July: recipients will get so much more!

Pensions will rise from July: recipients will get so much more!

As of July 1, 2025, the pension will be increased by 3.74 percent. This measure affects all pensioners, both in the east and in the west of Germany. The increase will benefit a direct increase in pension amounts for 21 million recipients, who will now receive 3.74 euros more for every 100 euros in pension. However, pensioners must expect deductions from health and nursing care insurance contributions as well as taxes. Loud star These deductions may mean that retirees will not feel the full effect of the increase in June.

The background to this pension increase is inflation, which is currently at 2.3 percent. The new value of a pension point will increase from 39.32 euros to 40.79 euros on July 1, 2025. One pension point is awarded for a year of average income, and the pension is calculated by multiplying the earnings points by the current pension value. This adjustment is part of the annual pension adjustment process, which is determined by the federal government in a regulation, which requires the approval of the Federal Council. Those too German pension insurance confirms these details regarding the adjustment.

Development of pensions

Over the past decade, pensions in the West have risen by 65 percent, while inflation was only 27 percent in the same period. What is particularly striking is that between 2000 and 2024 pensions increased by 65 percent in the West and by as much as 90 percent in the East. These developments are a sign that pension adjustments have remained fairly stable in recent years and that pensioners have experienced significant improvement relative to inflation.

Particularly relevant for pension levels is the minimum security level, which guarantees that pensions make up at least 48 percent of an average earner's salary. This adjustment also leads to a secure pension level, as a level protection clause has been implemented for 2025, which ensures that the pension level does not fall below this 48 percent. The wage factor and net ratios can also have an influence on the pension adjustment. A wage factor of 1.0369 and a net quota effect of 1.0005 are relevant for the coming year.

Communication of the pension increase

Pensioners will be informed of the upcoming increases through notices expected to be sent between June 14 and July 23, 2025. These notifications are made by Deutsche Post AG's Pension Service and provide pensioners with clear information about their new pension amounts. For example, with a pension amount of 1,000 euros, the pension would rise to 1,037.40 euros.

The developments around pensions and the adjustments are aimed at ensuring the financial security of pensioners and taking into account the increasing cost of living. The adjustment on July 1, 2025 offers pensioners the opportunity to get a little more from their pension, although deductions from the gross amounts must be taken into account.