Social contributions: The whole family is threatened with rising costs!

Social contributions: The whole family is threatened with rising costs!

In their most recent spring report dated May 21, 2025, economists gave a gloomy forecast for the development of health insurance and care costs in Germany. Accordingly, a significant increase in social contributions is forecast in 2025, with these rising faster than gross wages and salaries. This is mainly caused by the increased contributions for health insurance and care.

At the beginning of 2025, the social care insurance contribution rate was increased by 0.4 percentage points. At the same time, most health insurance companies have increased their contributions by an average of 0.8 percentage points. This means that health insurance contributions in Germany are becoming more expensive. The general contribution rate remains at 14.6 percent of gross income, while additional contributions have increased to an average of 2.9 percent.

Budget burdens and need for reform

An alarming sign of the financial stability of statutory health insurance companies is the deficit of 6.2 billion euros that the institutions recorded in 2024. To stabilize the health funds, the federal government was forced to provide 800 million euros. Doris Pfeiffer, the chairwoman of the statutory health insurance (GKV), warns of a possible “tsunami of contributions” if fundamental reforms are not implemented.

Martin Werding reveals the limited budget scope. Health economist Wasem expects health insurance contributions to increase by around 0.2 percentage points in the next two years if no reform measures are taken. The nursing contribution will also continue to rise, particularly due to demographic developments and wage increases for nursing staff. The care contribution will be increased to 3.6 percent for insured people with one child, while those without children must expect a contribution of 4.2 percent.

Long-term stress for employees

The IGES research institute predicts that the burden of social security contributions will rise to 49 percent in the next ten years unless countermeasures are taken. The current burden is currently around 42 percent of gross income. Many experts see this as a hindrance to the German economy, especially in light of the controversial coalition agreement between the Union and the SPD, which is criticized as inadequate.

Dittrich from the Central Association of German Crafts calls for a rethink and greater control of costs in the social security systems. He appeals not to place the financial burden solely on the younger generation. The unclear positioning of the coalition partners with regard to necessary reforms increases uncertainty in the market and among the population.

The mood remains tense; While slight economic growth of 1.0 percent is expected for 2026, the trade conflict, particularly caused by Donald Trump, is seen as a negative factor for the economic outlook.

For more information on business expectations and the challenges ahead, take a look at the reporting from Fr.de and Deutschlandfunk.