Additional saving for retirement is therefore obligatory. However, it is important to keep an eye on inflation, which permanently reduces the value of accumulated assets.

But which form of investment is suitable to protect your wealth permanently against inflation and additionally to provide for a later financially carefree retirement? Why savings accounts, call money accounts and also life insurances are not suitable as a form of investment to protect your wealth permanently against inflation.

"The pension is safe" - but not its amount

In 1997, during a heated debate in the German Bundestag, Dr. Norbert Blüm (CDU, former Federal Minister of Labor and Social Affairs) uttered a political phrase that has probably also burned itself into your head:

On that day, the Bundestag passed the controversial pension reform. The low birth rate and increased life expectancy forced politicians to act for the first time.
How is the amount of your statutory pension determined in the first place?

Pension calculation cannot be reduced to a small simple formula. However, two things in particular are decisive for the amount of your pension:

•     the earning points and
•     the pension level.

Earnings points are earned every year through your contributions to the pension insurance scheme. They are based on the average income of all employed persons. If you have earned the same amount with https://exnesslatam.com/trading-de-energias/ as the average for a year, you receive one earning point. If your earnings are higher or lower, you will receive correspondingly more or fewer earning points.

When you retire, your earned income points are added together and multiplied by the currently applicable pension value.

The pension value is defined in such a way that a politically desired pension level is achieved. Currently, it is about 48 percent of the average income of all employed persons. The pension level was originally based on the general development of wages. Pensioners were thus supposed to participate in the general development of prosperity and be protected against inflation.

Depending on the level of your personal earnings and the length of your employment, your pension may be higher or lower than the standard pension.

Pensions will decrease in the future

The system works well as long as there are enough young contributors for every pensioner. However, the proportion of older people is constantly increasing due to the higher life expectancy of the population and simultaneously declining birth rates.

In order to counteract the demographic development, the legislator has decided to gradually reduce the pension level. By 2030, the pension level will drop by a full 20 percent, meaning that all pensions will lose value dramatically.

This makes it clear that your standard of living in old age can no longer be maintained by the state pension alone. In the future, the state pension will only provide a basic pension. Additional old-age provision is therefore mandatory.