At what age can ask for reform? And what happens if I order before? Even if you still have a few years of work ahead of you, see how it works and what to do to avoid being penalized when you stop working.
If retirement age is approaching, see what you will need. You can apply a maximum of three months in advance of the start date of the renovation. The Pensão na Hora system made this process faster, but, as we will see, it is not accessible to everyone.
Who has the right to ask for the reform?
If you have worked, are of legal retirement age – the so-called normal retirement age – and have made discounts for a minimum period, you will be able to apply for retirement and be entitled to an old-age pension.
There are other types of pensions, such as those granted on disability. However, the most common is the one that marks the end of active life. From then on, and instead of salary, you will be entitled to a pension. The old-age pension, better known as retirement.
In this way, employees, members of Statutory Bodies (directors, managers and administrators), self-employed workers and beneficiaries of the Voluntary Social Security are entitled to request the retirement.
What are the conditions for requesting the reform?
In order to access the old-age pension, conditions related to age and the period of deductions must be met.
The age criterion means that, in 2023, must be at least 66 years and 4 months old
However, if you are younger, but have a contributory career of more than 40 years, you can also apply for retirement without any penalty. In this case, you will have reached your “personal retirement age”. That is, even though he is not 66 years and a few months old, he discounted more than 40 years and, therefore, meets another requirement.
It is also possible to apply for retirement before this age, if you have a demanding job or if you are part of the long-term unemployment anticipation scheme.
The cases in which it is possible to request early retirement are therefore exceptions. However, the general rule is this: be of legal age, have 40 years of discounts and comply with the warranty period.
Thus, in the case of employed and self-employed workers, it is necessary that they have deducted for 15 years for Social Security or another equivalent scheme. These discounts may not have been made in consecutive years.
When and how to apply for reform?
You can ask for the reform up to three months before the date you want to stop working. The quickest way to do this is through the Pension on the Hour, Social Security Direct.
The other option is to take care of the process at the Social Security services. In this case, the average response time is 50 days.
Advantages of applying for retirement on the internet
When ordering online you will see the years of contributions and have access to the estimated gross amount of the pension you will receive.
You can also track the status of the process and have access to the documents you have delivered.
In addition, if you meet the necessary conditions, will have a faster response: the request is automatically approved. Within 24 hours a provisional pension is awarded.
And what conditions are these? Basically, those that allow the process to be handled automatically, without recourse to other entities. So, it must have:
- Personal age of access to the pension;
- 15 or more years of earnings record or 144 months in situations of Voluntary Social Security;
- Contributory career only in Social Security;
- Be covered by the normal retirement regime, not having special careers;
- Residence in Portugal;
- Accounts up to date with Social Security. You cannot have debts to this entity.
Ask for the reform in person
To apply in person, you must fill in the form Mod.RP5068-DGSS and gather the following documents:
- Valid identification document. It can be a Citizen Card, identity card, civil registry certificate, birth certificate or passport;
- Taxpayer number (NIF);
- If the beneficiary does not know how to sign, he must also present the valid identification document of the person who signed the application;
- If the period of compulsory military service has not yet been accounted for for the purposes of retirement, you must submit a photocopy of the documents that prove this period: military booklet or certificate issued by the competent Recruitment and Mobilization District;
- Proof of Bank Identification Number (NIB/IBAN). The applicant must be the account holder.
The fact that you are retired and receiving an old-age pension does not prevent you from continuing to work in Portugal or abroad. You will only be unable to continue working if, before the old-age pension, you were receiving an absolute disability pension.
It can also be accumulated with pensions paid by other mandatory national and foreign schemes or by optional schemes.
It is also possible to accumulate with:
On the other hand, pension cannot be combined with sickness or unemployment benefitsSocial Benefit for Inclusion or with the Voluntary Social Security pension.
What if I apply for early retirement?
Asking for early retirement implies a penalty. That is, you will receive less than you would receive if you waited for the moment when you meet all the conditions for accessing the old-age pension.
It is, in fact, a double penalty. In addition to a 0.5% cut, for each month in advance, a 13.83% cut will also be applied to the pension amount due to the sustainability factor.
The purpose of these penalties is exactly that: to make people retire later, thus reducing the time they are receiving a pension. And, in this way, keep Social Security accounts balanced.
Bonus for continuing to work
On the other hand, those who continue to work after reaching retirement age are compensated.
A longer career means having a subsidized pension. This value varies with the number of years of contributions. That is, for each additional month you benefit from a percentage increase in the calculation of the pension. That percentage is multiplied by the number of months you worked after reaching retirement age.
However, only the months of effective work until the worker reaches 70 years of age count. For example, periods of sick leave are excluded.
But there are other possibilities to obtain the bonus before reaching retirement age. Workers covered by early retirement schemes, because they have many years of discounts, can choose to continue working.
In this case, they add up to a 0.65% bonus for each additional month of active life until retirement age is reached. In this situation, the months of effective work continue to count. The pension is limited to 92% of the best earnings used for the calculation.
Be retired and continue to work
A pensioner who continues to work, whether employed or self-employed, will have an increase in the pension corresponding to 1/14 of 2% of the total registered earnings.
If, for example, you earn €14,000 in a year (€1,000 x 14) you will, from January of the following year, have an increase of €20 in your monthly pension.
Article originally published in July 2019. Last updated in January 2023.