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Wednesday 2 September 2015

Early retirement (Πρόωρη σύνταξη)

One of the greatest sticking points in Greek reforms was the overturning of the laws on early retirement. Greece has a ratio of one retired person for every working person, when in Europe this ratio is 1 retiree for every 4 workers. So it is truly incredible that anyone would put it in their head that this is a sustainable situation.

Let's take for example a woman with children under the age of 18: she could work for just 15 years in the public service, and then retire on a full state pension. The same person working in the private sector could complete 25 years of full employment before the age of 50 and then semi-retire, on a half-pension. So it was not just a case of retiring early: state employees were given unwarranted special attention, and people were categorised in such a way that almost anyone could seek early retirement of some sort through some loophole in some law. The working mother was seen as the holiest order in those early retirement laws, while state employment topped the ranks. 

Mothers must be with their children, as the old adage tells us. Well, most of the time, those children would often be left in the care of a grandmother while the young retiree enjoyed life. In the days when women did not work, they would look after the house. The year 1981 gave women a chance to work outside the home with the increased possibilities for employment that EU entry gave. Office jobs were created t the same time that laws were promised to allow women to retire early. While young women were working, their mothers were cooking the main meal of the day, and looking after their children. The family was and still is the most important of Greek institutions, as the crisis has shown. Greeks also live healthier and longer lives than they did in 1981, and women are more likely to start a family at a later age than in the past, something that was not taken into account when the laws for early retirement were drawn up.

My analysis above may sound judgmental; it may sound like I am suffering pangs of jealousy because I was never one of those lucky bitches who had an unpaid maid looking after her young family while she took cruises to Greek islands in the summer and visited Eastern Europe by bus in the winter, together with her youthful husband who had also found a way to retire early with a state pension. But few people realise that I too belonged to the category that could seek early retirement as a mother of underaged children. So at the grand age of 50, which I would turn in 2016, I would be a retiree, having completed 25 years of gainful employment in the Greek private sector!

Fortunately or unfortunately, depending on how one sees things, with the new laws, I will not be able to retire until I am 56.7 years of age: 
"Mothers insured with IKA (the state healthcare system) until 1992, who would once have been able to draw a partial pension with 5,500 working days, completed by 2012 if they had not completed their 50th birthday, will now, instead of 50 years have to wait to retire at 55; thus, they will be forced to wait a further five years. If they turn 50 in 2016, they will be forced to wait until 56.7 years, and if they turn 50 in 2017, they will wait until they are 58.4 years old." http://news247.gr/eidiseis/oikonomia/syntakseis-poioi-xanoyn-oristika-ta-62-akomh-kai-gia-meiwmenh.3638576.html
In my situation, I would not have taken the option of early retirement, because my salary is not very high, and a partial pension would have yielded just over half my current salary, a rather low monthly sum that would not cover my family's need in the way that my salary does now. It would have resulted in financial difficulties for my family, and my husband would have felt the need to work more than he does now, at a time when he has slowed down due to age (he hasn't worked the taxi at night since the beginning of the crisis). 


But I still feel very lucky to be able to dream of early retirement on a semi-pension at 56.7 years of age. In my husband's line of work, he can only draw a state pension at the age of 67. I have a 10-year age difference with my husband. Therefore, we will be able to retire together. We can still make plans together to visit places we have never been to before we both get too decrepit. It sounds like much more fun to ride off into the Santorini sunset together than to leave one's other half waiting at home. 

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7 comments:

  1. My rent (that I do not expect to recieve before the age that your husband has to reach) will be at about 43% of my average income through out my working life.....

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    1. with the current laws, we have calculated that my husband's pension will be less than 500 euro, and my own pension (if we retire together despite our age difference) will be much the same (the laws may change and I will get even less if i retire early)

      what saves us is that we are not in debt, we own a freehold home, and we are willing to grow as much food as we can - it isnt looking good anywhere at the moment

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  2. Here is the US one CAN retire at age 62, which is what my hubby did. But...he can work parttime and earn up to $15,000 a year until he reaches full retirement age at 66, I think it is. We have finally realized that that $15,000 really is ALL going to pay his health insurance premiums and the $6,000 deductible that he has to pay before anything is paid 100 percent by health insurance. So...that's over $10,000 a year that he pays just to have health insurance. He attained that deductible last week with a minor hernia surgery, for which we paid "out of pocket" over $2,000. Now that he's paid the total $6,000 deductible, he will have several minor surgeries that he has been postponing. He is is good health, just wear and tear gets you and you have stuff to "repair." He did retire at age 62 and I also retired with a pension from the school district that is adequate to pay the mortgage, nothing more. Here in the US, if you have a pension your Social Security is reduced. The rule is called the WINDFALL elimination provision or WIP. As if Social Security is a windfall!!!! We here in the US consider it a right.
    We are glad that he retired at the same time as I did. If one, like you and your family, Maria, knows how to live well on a lower income, then things are just fine. We do it. We just do not expect to travel, have new cars or spend a lot on unnecessary stuff.
    Anyway, if you can manage financially, I urge you to do it. Retire and have time together as a family and just live. There is nothing better out there! I hope you can do it soon although I know you might miss your students. I do.

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    1. I fully agree Caterina. Retire early and enjoy life. I will never have free time on my hands anyway, i am too busy a person for that - so many things to do and I never have enought time!

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  3. Greek engineers either self employed or employees are treated the same way under their obligatory participation to their pension fund and cannot retire before 40yrs of payments, the earlier is 62 yrs of age if you graduate at 22 after a 5 yr course (?). The required work period was 35 yrs before the crisis but it was increased to 40. No young children taken into account or any other option for early/ semi retirement except for serious health problems. Of course in the fat cow yrs uptil the '80's no engineer would ever contemplate to retire but the new generation is trapped in this system having less rights even to the IKA despite even working in the public service. There is no common sense in this country after I saw a few yrs ago my work yrs being raised from 35 to 40 and other employees still getting full pension after 25 yrs of work. And our healthy pension fund due to the fact that the ratio of pensioners to those contributing was 1:8 (no early retirement policies offered) has been gobbled up by another indebted pension fund for which we cover its obligations.

    And of course all those millions of pensioners are the biggest voting group resisting change and clinging to their privileges. I say pensions should be less than salaries. The excuses that they support their unemployed children are a laugh as they are the cause of their childrens' problems. I hope the new Syriza govt will be brave enough to force these changes.

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    1. i completely agree about the pensioners who claim that they are supporting thier children - its as if their pension is the holy cow, but it actually constitutes the problem
      at my workplace, we sometimes have get-togethers with former staff - i am truly amazed to see women just a few years older than me, who have been pensioned off for at least five years, striding into the function hall looking younger than me. I am working so that one of them does not work.

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  4. 66 is now the age to retire in the UK.

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