Is early retirement a good idea?
Whether you're 30 or past 60, you’ve probably considered early retirement at some point. And whether that's a good idea for you depends entirely on your personal circumstances.
ING CDC Pensioenfonds allows you to have your pension paid out (on a full or part-time basis) from your 60th birthday. Deferring your pension until after you've turned 67 is not possible. It’s up to you to decide what works best for you. The pension fund will help you make an informed decision.
What would you gain?
That's a very personal question only you can answer. You might want to start enjoying your retirement sooner and live the life you envisage. Have you checked your Uniform Pension Overview (UPO) to find out how much pension you’ve built up so far? You might be able to afford retiring earlier than you thought. Use the Pension Planner to calculate how much income you’d have (before and after taxation) if you were to opt for early retirement.
What would it cost you?
It's a myth that you’d have to pay for early retirement. This is how it works: retiring early means you’ll need your pension savings to cover a longer period of time. In other words, you’ll be spreading your pension accrual across more years, and as a result the amount paid out per year will be lower. However, you’d start receiving your pension sooner.
Important: opting for early retirement means you choose to work fewer years, which in turn means you build up less old age and partner pension. And if you have not yet reached your Dutch state pension (AOW) retirement age, you will be subject to a higher tax rate.
In practice
Would you like to retire early and at the same time increase your retirement income by using the options offered by the CDC pension plan? You could opt for a supplemental AOW-gap pension of € 10,422, € 15,276 or € 20,845 (pre-tax) per year. These amounts are based on AOW pension benefits for single and married individuals. Another option would be to vary the amount of your pension benefits. You could opt for higher pension benefits until you turn 70, or during the first 3 to 5 years of your retirement, and lower benefits in the years that follow.
Important: choosing any of these options will cause your pension to decrease in the long term, and you might not have enough pension income to live comfortably (inflation plays a part too). So keep some leeway when you make your choices.
Start ahead of time
It's advisable to calculate how much you'd gain or lose from early retirement well ahead of time, so you can make a well-informed decision. Log in to the Pension Planner using your DigiD. It will help you calculate the financial consequences of the pension options available to you. If you’d like some more information, or if you're ready to make final choices, please contact the Pension Desk. Important note: once your retirement has started, you will not be able to change your choices.