Will my state pension be enough?
Your group insurance plan
Group insurance is one of the best known and most commonly offered fringe benefits. It provides the opportunity to top up your meagre state pension with a supplementary pension, available through your employer. Throughout your career, you build up a retirement nest egg through regular employer contributions and – in some companies – through employee contributions as well. When you retire, you cash in on the savings in the form of a lump sum or a monthly annuity, depending on your pension plan. There are positives and negatives to both options, which we've summarised here.
Your pension plan regulations will stipulate the different ways you can cash in on your entitlements as well as the age the supplementary savings can be claimed. To check your pension plan regulations, log in to the MyAG Employee Benefits app.
Another important document is your benefits statement. Every year, your group insurance provider will send you a statement which specifies your gross entitlements if you were to leave your company (= your accrued reserves). It also includes the projected value of your benefits when you reach retirement age.
As benefits statement can be a challenge to understand, we've put together a handy explanatory sheet to assist you.
If you have a group insurance plan with AG Employee Benefits, you'll receive an e-mail alert to let you know whenever you have a new benefits statement available. Via MyAG Employee Benefits, you'll have access to your historical benefits statements with all of your employers, past and present, as long as the plans in question are managed by AG Employee Benefits.
Your benefits with the MyAG Employee Benefits app
Register and log in to MyAG Employee Benefits to find out more.
You can then take advantage of its many features including:
- detailed information about your covers and benefits as well as any changes in the status of your group insurance
- the projected net benefit amount that you'll be entitled to collect when you retire
- your group insurance-related information and documents such as your benefits statements
The pension system in Belgium
Many employers help their staff members build up a bigger retirement nest egg by providing a supplementary pension.
Each pension plan is custom-designed to fit your employer's specifications. Some of the covers described below may not apply to your plan. For a complete description of the covers included in your plan, go to the MyAG Employee Benefits app.
Your state pension: a few quick facts
After years of hard work, it's only natural to want to relax and enjoy a comfortable retirement. In Belgium, statutory retirement age is currently 65. By 2030, it will gradually be raised to 67.
Early retirement is still an option, although the eligibility requirements are becoming much stricter.
The retirement benefit that you'll collect also depends on your years of qualifying service. If you choose to work part-time or take early retirement, it will impact the size of your statutory and supplementary pension entitlements. For more information about this, you can check online or direct any questions to your HR department.
The three-pillar system
Belgium has pursued a three-pillar approach to retirement income:
- First pillar (state pension)
Your state pension or retirement pension is the amount you'll collect based on qualifying years of service as an employee or self-employed worker. The amount varies according to different factors and reflects your specific case.
As you probably already know, this system has been under pressure, notably due to the ageing population. And the sad fact is that Belgian state pensions are not exactly generous to start with. This is what prompted the creation of two additional pillars.
- Second pillar (supplementary pension)
Many employers help their staff members build up a bigger retirement nest egg by providing a supplementary pension. Every month, they allocate a set contribution to a pension fund or group insurance scheme. Depending on the pension plan, employees may also be allowed to make additional contributions themselves.
- Third pillar (individual supplementary pension)
More and more people are turning to individual pension savings plans as a way to top up their future retirement income.The most common vehicles are retirement savings plans and long-term savings plans. Both options come with attractive tax incentives to encourage this type of investment. The sooner you get started, the longer you can take advantage of the tax deduction.
In the next section, we'll be focusing more specifically on the second pillar. To find out everything you need to know about your state pension (first pillar), go to mypension.be. Questions about your death benefit or hospitalisation coverage? Read our key moment "I'm retiring (soon)".