Contributory pensions have been revalued by 3.8% in 2024 and non-contributory pensions by 6.9%. The Government thus maintains its commitment to guaranteeing the purchasing power of pensioners and favouring the most vulnerable people.
Contributory and non-contributory pensions
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Contributory and non-contributory pensions
In December 2023, the Council of Ministers approved the revaluation of contributory pensions, on a general basis, by 3.8% and the increase in the annual amount of non-contributory pensions by 6.9%. This decision means that 11.8 million pensions and benefits have gone up in 2024.
The average pension of the system stood in February 2024 at 1,250.7 euros per month. This amount includes the different types of contributory pension (retirement, permanent disability, widowhood, orphanhood and in favour of family members). In the case of retirement pensions, the average is 1,437.1, while the average widow’s or widower’s pension is 893.1 euros per month.
In the case of non-contributory pensions, both retirement and disability pensions have increased to 7,250.60 euros per year (517.90 euros per month in 14 payments).
The pensions that have risen the most are the lowest, which correspond to people with the lowest income. In addition, the increase has a direct effect on reducing the gender gap, one of the Government’s unwavering objectives.
WHAT ARE CONTRIBUTORY PENSIONS?
These are economic benefits whose duration can be defined or indefinite. They are generally granted only if the beneficiary has had a previous legal relationship with Social Security and meets a series of requirements depending on the type of pension.
How is the amount of contributory pensions determined?
The amount is determined based on the contributions made by the worker and the employer, in the case of employees, during the period considered for the regulatory base of the pension in question.
What types of contributory pensions are there?
The General Scheme and the Special Schemes that form part of the Social Security system (with the particularities and exceptions indicated by each scheme) provide for these pensions:
Type of contributory pensions in SpainPool Moncloa
- RETIREMENT: The Social Security retirement pension is a lifetime economic benefit granted to the worker when, due to age, he/she stops working as an employee or self-employed person or reduces his/her working day and salary under the legally established terms.
What are the modalities and requirements to apply for the retirement pension?
The applicant must meet certain age and contribution requirements that vary depending on the type of retirement requested:
- Ordinary retirement: To qualify for ordinary retirement, the worker must have contributed for at least 15 years, of which at least two must have been within the 15 years immediately preceding, and must be of the age established by law. In 2024 it is 66 years and 6 months when the applicant has less than 38 years of contributions. If he/she has them, he/she will be able to retire at 65 years of age.
- Early retirement: A legal modality that allows the worker to retire before reaching the legal age. Types: early retirement due to the professional group or activity, early retirement for disabled workers, early retirement due to being a member of a mutual insurance company, early retirement without being a member of a mutual insurance company, early retirement due to non-voluntary termination of employment, early retirement due to the employee’s will and early retirement due to a labour force adjustment plan.
- Partial retirement: In partial retirement, the worker, after reaching the age of 60, decides to collect part of his pension while receiving a salary for his part-time activity in a company. Types: partial retirement in the manufacturing industry.
- Flexible retirement: Flexible retirement is designed for pensioners who want to return to the labour market, since they can combine their pension with a part-time contract, with a consequent reduction in their benefits.
- Special retirement at age 64: Special retirement at age 64 is a modality that, generally speaking, disappeared in 2013, but is maintained for certain workers.
What is the deadline for requesting the retirement pension and when does payment begin?
Workers who are registered with Social Security can apply within three months before or after the date of termination of their activity. The economic effects of the pension start on the day following the date of termination of employment.
PERMANENT DISABILITY: The permanent disability pension, in its contributory form, is intended to cover the loss of salary or professional income suffered by a person when he/she is affected by a pathological or traumatic process and has his/her working capacity reduced or annulled. It can be a partial, total, absolute or severe disability.
- DEATH: These death and survivors’ benefits are intended to compensate for the economic need produced, for certain persons, by the death of others. They are classified as widowhood, orphanhood and in favour of family members.
The Compulsory Old Age and Disability Insurance (SOVI) is a residual regime that applies to very few workers and includes old age, disability and widowhood pensions.
Who manages contributory pensions?
The management and recognition of the right to a retirement pension is generally the responsibility of the National Social Security Institute.
WHAT ARE NON-CONTRIBUTORY PENSIONS?
These are economic benefits granted to citizens who lack sufficient resources for their subsistence, even when they have never contributed to the Social Security system or have not contributed long enough to be able to apply for contributory benefits.
What types of non-contributory pensions are there?
Non-contributory pensions can be retirement or disability pensions.
How is the amount of both non-contributory pensions determined?
The annual amount of non-contributory pensions is established each year in the General State Budget Law. Pending their approval, the Government agreed to an increase of 6.9% to reduce the gap between the amount of minimum pensions and the poverty threshold. In general, it was set at 7,250.60 euros for 2024, both for retirement and disability pensions.
The individual amount for each pensioner is determined based on this full amount and the number of non-contributory pension beneficiaries in the same economic unit.
What is the main requirement to apply for a non-contributory disability or retirement pension?
Lack of income or have an income of less than 7,250.60 euros per year in annual computation, by 2024.
If the applicant lives with family members, the sum of the annual income of all the members of the economic unit must be less than certain amounts.
What are the specific requirements to apply for a non-contributory retirement pension?
The non-contributory retirement pension guarantees citizens who meet these requirements a financial benefit, free medical-pharmaceutical assistance and complementary social services.