As Germany's first Social Security system was established in 1889, public Pension pay-as-you-go "to pay the pensions of current retirees from the current premiums are not retired. Currently about 85% of the population is enrolled in the public pension system. Officials who make up about 9% of the workforce, have their own pension and relatives of some 9% of the population, are usually self-confident (but may participate in the RCF.) The system is now pressure of an aging population, reunification, unemployment, economic conditions, retirement and other factors.

The income from the premiums are not yet fully to cover the costs of pensions, which is why the government introduced pension reform in 2001 and 2004. With the reforms of the public pension system increased premiums, decreased slightly to increase the pensions and retirement age. More importantly, for the first time in Germany is forcing employers and employees are encouraged to invest in private pensions through subsidies and tax breaks.

There are three pillars of the German pension system: 1) The government-run pension, 2) private business plans and 3) the private retirement investments.

The public pension system includes survivor and disability benefits, is dominant. Participation is mandatory for employees with each employee an amount not to assess the annual earnings. The premiums are established by the employer to the employee and the employer deducted half pay half. Pension starts today at the age of 65 years, although it gradually increased to 67. to increase contributions to the plan, and pensions reduced from 70% to 67% of net earnings.

Company plans are traditionally thought of retirement allowance and now a bigger role in reproduction. State subsidies and tax breaks will encourage companies and workers to invest in private plans. Although the company plans are not required, they include about three-fifths of the workforce, a percentage that is expected to increase. Pensions business plans usually start at the age of 65 years, although probably follow in many cases, the pension practice, and gradually increase to 67.

The third pillar individual pension investments are not very large, so far, but given much attention lately as to complement the public pension system. These include private plans (but not limited to) the Riester and Rürup plans. Employees and other participants, certain tax advantages and benefits for state subsidies for such plans. Distributions and other details vary from plan to plan. There are various payment options, payment methods, taxes, portability, features and other factors which differ from each other to plans. Some plans are better for different people, depending on their specific situation.

Foreigners living in Germany to participate in these plans. It is possible to pay the premiums and receive benefits from private pensions, even after he left Germany. Advantages of business plans can be received in general outside of Germany, but the rewards are not always reimbursed. If an expat eligible for a pension under the Public pension can be paid, even if they do not live in Germany.

There are many complicated details of the pension system; middle determining the amount of pensions, provisions for early retirement pension benefits for a stay on the track 65 increases, etc. The best way to know what exactly you are planning is to consult financial advisers.