So you can retire early at age 63: this is the amount of the pension you have left

Early retirement can be an alternative for those workers who want to end their working life and go to a deserved retirement after decades of service for a company or on their own. In some cases, this retirement advance can be given at age 63, although for this it must be under specific assumptions and meet specific conditions.

If the early retirement is voluntary, so that workers can benefit from it at the age of 63 They must have at least 37 years and three months of contributions. It is the contribution time required to have a retirement age of 65 years (it is 66 for the rest of the cases in 2021), and since the maximum advance period is two years in this type of early retirement, the worker would get the bills.

With less time contributed, the worker would have no other option but to wait. In 2022, in addition, the retirement age is slightly increased: it becomes 66 years and two months if it does not reach 37 years and six months of contributions (it remains at 65 years if that contribution milestone is met).

However, reaching that contribution requirement is not the only condition to be able to retire early at age 63. It is also necessary to demonstrate that they have contributed a minimum of two years within the last 15 years prior to applying for retirement and that they are registered with Social Security (or in an assimilated situation), as well as obtaining a pension higher than the minimum pension (or 50% of the regulatory base).

These are the cuts in their pensions

Retiring early has a counterpart, the reduction in the amount of the retirement pension, which will be reduced with the application of some reducing coefficients that depend on the previous contribution of the worker and that are the following during 2021:

-A 2% of the regulatory base for each quarter of retirement advance in careers of less than 38 years and six months.

-A 1.875% of the regulatory base for each quarter of early retirement for careers between 38 years and six months and 41 years and six months.

-A 1.75% of the regulatory base for each quarter of early retirement for careers between 41 years and six months and 44 years and six months.

-A 1.625% of the regulatory base for each quarter of retirement advance for careers of a duration greater than 44 years and six months.

Starting in 2022, people who are 63 years old and wish to retire early will do so with different reducing coefficients. The pension reform devised by the Minister of Inclusion, Social Security and Migrations, José Luis Escrivá, has modified them to encourage later withdrawals.

These coefficients, which will become monthly and applicable on the amount of the pension instead of quarterly and applicable on the regulatory basis, will be more beneficial in the middle sections of the table (in early retirements between 13 and 19 months in advance) and they will be more detrimental for late early retirements (one to three months before ordinary age) and early (23 and 24 months in advance).

It may be the case that, at age 63, early retirement comes as a result of an involuntary termination at the company where you work. It is what is called as involuntary retirement and allows early retirement up to four years before ordinary retirement age.

In order for the worker to be eligible for it, he or she must have at least 33 years of contributions (two of them in the last 15), be registered with Social Security, be registered for at least three months as a job seeker and that the dismissal is the result of a situation of “business restructuring”.

This type of early retirement also has as a counterpart the application of reducing coefficients that reduce the pension to compensate for the advance. They are as follows:

-A 1.875% of the regulatory base for each quarter of early retirement for careers of less than 38 years and six months.

-A 1.75% of the regulatory base for each quarter of retirement advance for careers between 38 years and six months and 41 years and six months.

-A 1.625% of the regulatory base for each quarter of early retirement for careers between 41 years and six months and 44 years and six months.

-A 1.5% of the regulatory base for each quarter of retirement advance for careers of more than 44 years and six months.

Like voluntary early retirement, this involuntary modality will be modified by the ‘Escrivá reform’. The coefficients will be modified to encourage these withdrawals at later ages and, in cases where the coefficients of voluntary early retirement are more beneficial, retirees will be able to take advantage of them.

Another of the criteria for retiring at age 63 may be that of the profession that you perform. Certain professions provide for special early retirements (with individualized reducing coefficients) by reason of the dangerousness, hardship or toxicity. This is the case of firefighters, miners, pilots and aerial work personnel, railway workers, local police, artists, bullfighters …

If the worker belongs to some of these professions, he will have to refer to the specific regulations of said profession to find out under what conditions he can retire early. Be that as it may, none of them prohibits their workers from retiring at age 63 as long as they meet the other criteria regardless of age. Social Security provides on its website a list of these professionals and the legal texts that regulate their retirements.