In Germany, individuals receiving disability pensions are set to benefit from additional state income, largely due to a significant increase in credited periods that boost their pension calculations.
In Germany, people receiving statutory disability pensions benefit from a calculation that considers not only their actual time in the workforce but also a period known as the “Zurechnungszeit” or credited period. This period includes the time between the onset of the disability and the standard retirement age for the year in which the disability began. According to the German Pension Insurance (DRV), these credited periods have led to an increase in pension amounts, as reported by Ihre-Vorsorge.de.
For the 164,000 Germans who began receiving disability pensions in 2023, the average monthly net pension was €1,001, which is €51 more than the previous year’s group. Compared to those who became disabled in 2013, the increase is nearly €390.
The credited periods have also enhanced the “Entgeltpunkte,” or pension points, which represent the pension entitlements earned through one’s work. In 2023, the DRV paid out €1.73 million in disability pensions, based on an average of 12.6 pension points from credited periods. A person with an average income can earn one pension point per year by contributing to the pension system. Each point is currently valued at €39.32, leading to a monthly increase of nearly €500 gross in disability pensions due to credited periods. However, the high pension deductions (e.g., over €112 for new pensioners in 2022) somewhat offset this increase.
Pension increases expected to shrink in the future
The DRV warns that future pension increases might shrink. This is partly due to the rising retirement age for people with disabilities, which has increased by three years to 54 over the past decade. Additionally, many new disability pensioners come from low-wage sectors. The extended credited period has contributed significantly to the pension increase, with an increase of almost two pension points between 2018 and 2023, equivalent to nearly €75 today.
Starting in July, the DRV will also pay supplements to approximately three million disability pensions. These supplements will also apply to old-age and survivor pensions that follow disability pensions. No application is necessary, as eligible individuals will automatically receive the supplement.
DRV provides information on new pension supplements
In July, the DRV will notify eligible recipients of their entitlement to the new supplement through a formal notice. This notice will detail the supplement amount and the payment period. Initially, the supplement will be paid separately from the pension in a distinct transfer between the 10th and 20th of the month. Starting in December 2025, the supplement and pension will be combined into a single payment.
Eligible individuals include those receiving a pension for partial or full disability if their pension began between 2001 and 2018. For pensions that started between January 2001 and June 2014, the supplement is 7.5%, while for those starting between July 2014 and December 2018, it is 4.5%.
