How to calculate monthly pension in 2024? Will the 2024 pension increase? How much percent increase in pension in Vietnam?
How to calculate monthly pension in Vietnam in 2024?
Pursuant to the provisions of Article 7 of Decree 115/2015/ND-CP, for people participating in compulsory social insurance, the 2024 pension calculation is based on the monthly pension rate and average monthly salary as the basis for social insurance payment.
Specifically, the 2024 pension calculation is shown by the following formula:
Monthly pension | = | Monthly pension rate (%) | x | Average monthly salary as the basis for social insurance payment |
In there:
(1) Monthly pension rate
Pursuant to the provisions of Clause 2, Article 7 of Decree 115/2015/ND-CP, Article 16 of Circular 59/2015/TT-BLDTBXH, Article 17 of Circular 59/2015/TT-BLDTBXH.
The monthly pension rate of eligible employees is as follows:
Retired year | Monthly pension rate | Number of years of social insurance payment | Additional rate |
From January 1, 2016 until January 1, 2018 | 45% | 15 years | 2%, for male employees, or 3%, for female employees, for each additional year of social insurance payment |
From January 1, 2018 | 45% | - For female employees: 15 years - For male employees: + 16 years if retiring in 2018; + 17 years if retiring in 2019; + 18 years if retiring in 2020; +19 years if retiring in 2021; + 20 years if retiring from 2022 onwards. | 2% for each additional year of social insurance payment |
In there:
- The maximum pension rate is 75%.
- When calculating the pension rate, if the social insurance payment period has odd months, from 01 month to 06 months is counted as half a year; From 07 months to 11 months is counted as one year.
- In case an employee retires before the prescribed age, for each year of retirement before the prescribed age, the reduction will be 2%.
(2) Average monthly salary as the basis for social insurance payment
The average monthly salary as the basis for social insurance payment is specified in Article 9 of Decree 115/2015/ND-CP as follows:
Average monthly salary as the basis for social insurance payment for determination of pension or lump-sum benefit
Average monthly salary as the basis for social insurance payment for determination of pension and lump-sum benefit prescribed in Article 62 of the Law on Social insurance (hereinafter referred to as average monthly salary) shall be determined as follows:
1. Each employee subject to the State-prescribed salary regime and having the entire period of social insurance payment under this salary regime, his/her payment period shall be determined as follows:
a) The last 5 years prior to retirement if he/she begins paying social insurance before January 1, 1995;
b) The last 6 years prior to retirement if he/she begins paying social insurance between January 1, 1995 and December 31, 2000;
c) The last 8 years prior to retirement if he/she begins paying social insurance between January 1, 2001 and December 31, 2006;
d) The last 10 years prior to retirement if he/she begins paying social insurance between January 1, 2007 and December 31, 2015;
dd) The last 15 years prior to retirement if he/she begins paying social insurance between January 1, 2016 and December 31, 2019;
e) The last 20 years prior to retirement if he/she begins paying social insurance between January 1, 2020 and December 31, 2024;
g) The entire payment period if he/she begins paying social insurance from January 1, 2025.
2. Each employee who has the entire payment period the employer-decided salary regime, the average monthly salary as the basis for social insurance payment of the entire period shall apply.
...
Thus, the 2024 pension calculation is carried out according to the above content. Particularly for social insurance participants whose pensions have been adjusted, the pension calculation will be as follows:
Pension = Pension + (Adjustment rate x Pension)
How to calculate monthly pension in 2024? Will the 2024 pension increase? How much percent increase in pension in Vietnam? (Image from the Internet)
Will the 2024 pension increase? How much percent increase in pension in Vietnam?
Pursuant to Resolution 104/2023/QH15 (effective from December 25, 2023) on state budget estimates for 2024 issued by the National Assembly, effective from December 25, 2023.
In Clause 1, Article 3 of Resolution 104/2023/QH15, it is stated about the implementation of salary policy from July 1, 2024 as follows:
Regarding implementation of salary policy
1. From July 1, 2024, carry out overall reform of salary policy according to Resolution No. 27-NQ/TW dated May 21, 2018 of the Seventh Conference of the 12th Central Executive Committee (Source Funding for implementing wage reform is guaranteed from the accumulated wage reform source of the central budget, local budget and a part allocated in the state budget balance estimate); Adjust pensions, social insurance benefits, monthly benefits, preferential benefits for meritorious people and a number of social security policies that are tied to the statutory pay rate.
Thus, according to the above regulations, from July 1, 2024, the 2024 pension will be adjusted at the same time as the implementation of the salary reform policy.
However, there is currently no official announcement or document about the pension increase in 2024. How much the 2024 pension will increase will have to wait for further information from the authorities.
How to calculate pension in 2024 according to the instructions of the Ministry of Labor, War Invalids and Social Affairs of Vietnam?
Pursuant to Article 17 of Circular 59/2015/TT-BLDTBXH amended by Clause 15, Article 1 of Circular 06/2021/TT-BLDTBXH.
Here are a few ways to calculate 2024 pension:
Example 1:
Ms. Q quit her job and enjoys retirement benefits from May 2022, having paid social insurance for 15 years.
The evolution of Ms. Q's monthly salary paid for social insurance in the 10 years before leaving her job is as follows:
- First 2 years: 8,000,000 VND/month
- The next 4 years: 10,000,000 VND/month
- Last 4 years: 13,000,000 VND/month.
So:
- Ms. Q's pension rate is 45%;
- Average monthly salary paid for social insurance:
[(8,000,000 VNDx24 months)+ (10,000,000 VNDx48 months) + (13,000,000 VNDx48 months)] / 120 months
= 10,800,000 VND/month.
- Ms. Q's monthly pension is:
10,800,000 VND x 45% = 4,860,000 VND/month.
Example 2:
Mr. H, Chief of the Ministry Office, retired to enjoy retirement benefits from April 1, 2016; The total period of social insurance payment is 30 years. Before moving to the position of Chief of the Ministry Office, Mr. H was a prosecutor of the People's Procuracy, with 14 years of professional seniority calculated with a salary coefficient of 5.08. Mr. H's salary for social insurance payments in the last 5 years is as follows (assuming the base salary as of April 2016 is 1,150,000 VND/month).
- From April 2011 to March 2014 = 36 months, salary coefficient is 6.2:
1,150,000 VND x 6.2 x 36 months = 256,680,000 VND.
- From April 2014 to March 2016 = 24 months, salary coefficient is 6.56:
1,150,000 VND x 6.56 x 24 months = 181,056,000 VND.
- The average monthly salary paid for social insurance in the last 5 years as a basis for calculating Mr. H's pension is:
[(256,680,000 VND + 181,056,000 VND) / 60 months] = 7,295,600 VND/month.
- Mr. H's seniority allowance before transferring to the Ministry of Labor, War Invalids and Social Affairs is added to the average monthly salary as the basis for pension calculation as follows:
Mr. H's salary coefficient before transferring to the Ministry of Labor, War Invalids and Social Affairs was 5.08; Professional seniority allowance is calculated at 14%:
1,150,000 VND x 5.08 x 14% = 817,880 VND.
- The average monthly salary paid for social insurance as a basis for calculating pension is:
7,295,600 VND + 817,880 VND = 8,113,480 VND.
- Mr. H's monthly pension is:
8,113,480 VND x 75% = 6,085,110 VND/month.
Example 3:
Mr. M was a former Customs officer, transferred to become a prosecutor of the People's Procuracy, and retired to enjoy retirement benefits from April 1, 2016; The total period of social insurance payment is 27 years, of which 11 years are counted as teachers' seniority and 16 years as procurator seniority. Mr. M's salary for social insurance payments in the last 5 years is as follows (assuming the base salary as of April 2016 is 1,150,000 VND/month).
- From April 2011 to March 2014 = 36 months, salary coefficient is 5.76; Professional seniority is 25%:
1,150,000 VND x 5.76 x 1.25 x 36 months = 298,080,000 VND.
- From April 2014 to March 2016 = 24 months, salary coefficient is 6.10; Professional seniority is 27%:
1,150,000 VND x 6.10 x 1.27 x 24 months = 213,817,200 VND.
- The average monthly salary paid for social insurance in the last 5 years as a basis for calculating Mr. M's pension is:
(359,931,600 VND + 256,365,360 VND) / 60 months = 8,531,620 VND/month.
- Mr. M's monthly pension is:
8,531,620 VND/month x 69% = 5,886,818 VND/month.
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