Overview

• Pensions will increase by 3.74 percent from July 1, 2025, boosting an average 1 500 euro pension by about 56.10 euros monthly and reaching full impact in August after a higher care insurance deduction in July.
• The government has pledged to keep the pension level at 48 percent through 2031, covering the resulting budget shortfall with tax funds to avoid a sharp rise in contribution rates.
• A new study shows that 1.8 million baby boomers retired before reaching statutory age by end-2023, representing roughly 44 percent of their cohorts and straining the pay-as-you-go system.
• The Bundesbank urges lawmakers to tie both statutory and earliest retirement ages to life expectancy, eliminate penalty-free early retirement and recalibrate monthly deduction rates.
• Baden-Württemberg Finance Minister Danyal Bayaz suggests differentiating retirement ages by education level, proposing a start at 68 years for bachelor graduates and 69 years for those with a master’s degree.