Half of all Germans ‘worry about old-age poverty’

Germans are afraid of falling into poverty when they get older, a new survey has found.

Half of all Germans 'worry about old-age poverty'
Germans are worried about getting older. Photo: DPA

According to the survey by Deutsche Bank with opinion research institute Ipsos, every second person in Germany has concerns about being able to live comfortably when they get older, while almost as many lack the means for private provision.

The study found many people feel the state pension will not be sufficient in retirement.

“We are seeing a rather shaken confidence in the statutory pension,” said Thomas Hörter, Head of Market Research at Deutsche Bank.

According to the survey, only 17 percent of the 3,200 respondents between the ages of 20 and 65 expect the state pension to be sufficient in old age. A massive 70 percent, on the other hand, believe that they'll only get basic care from this source.

And at least half (54 percent) of those surveyed even expect the statutory pension system to collapse sooner or later as Germany struggles with an ageing society.

READ ALSO: Old-age poverty in Germany 'set to rise significantly'

The survey came as Germany discusses raising the pension age from 67 to 69 as people live longer.

Concerns about poverty in old age are particularly high in Berlin, with 61 percent of respondents saying they have worries.

In Munich that number was 58 percent, in Brandenburg it's 56 percent and in Saxony 55 percent of respondents are worried about old-age poverty.

In the wealthier federal states of Baden-Württemberg and Bavaria, around 48 percent of people are worried about falling on hard times when they retire.

Germans would like to save more

The awareness that private pension provision is necessary in order to maintain your own standard of living in retirement is also high. Almost three quarters of those surveyed (71 percent) are convinced that private pensions are needed.

Currently, respondents say they are putting aside about €50 per month for retirement. According to their calculations, however, a savings rate of €200 per month is actually needed.

Almost half of those surveyed (47 percent) stated they would like to save more for old age but had no money left.

Estimates of how much money is needed in old-age vary. On average, the respondents said a monthly minimum of €1500 euros per person was sufficient.

Meanwhile, 56 percent of respondents say they often struggle to understand pensions, while 36 percent consider the whole issue too complex.

“People are standing in front of a wall of fog,” said Hörter.

The chief investment strategist for private and corporate clients at Deutsche Bank, Ulrich Stephan, said the range of pension plans on offer could “possibly be streamlined” to make it more simple for people.

However, given the huge number of individual needs, a broad range of offers is needed, he said.

READ ALSO: Pensioners working more to avoid 'old-age poverty'


Old-age poverty – (die) Altersarmut

Shaken confidence – erschüttertes Vertrauen

State pension (die) gesetzliche Rente

Retirement – (der) Ruhestand

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Reader question: Can I get a retirement visa for Germany?

Unlike in EU countries such as Portugal or Spain, Germany does not have a visa specifically for pensioners. Yet applying to live in the Bundesrepublik post-retirement is not difficult if you follow these steps.

Reader question: Can I get a retirement visa for Germany?
Two pensioners enjoying a quiet moment in Dresden in August 2020. Photo: picture alliance/dpa/dpa-Zentralbild | Sebastian Kahnert

Due to its quality of life, financial security and health care, Germany snagged the number 10 spot in the 2020 Global Retirement Index. So just how easy is it to plant roots in Deutschland after your retirement?

Applying for a residency permit

As with any non-EU or European Economic Area (EEA) national looking to stay in Germany for longer than a 90-day period, retirees will need to apply for a general resident’s permit (Aufenthaltserlaubnis) under which it will be possible to select retirement as a category. 

READ ALSO: How does Germany’s pension system measure up worldwide?

This is the same permit for those looking to work and study in Germany – but if you would like to do either after receiving a residency permit, you will need to explicitly change the category of the visa.

Applicants from certain third countries (such as the US, UK, Australia, South Africa, Japan, South Korea, Israel, Canada, and New Zealand) can first come to Germany on a normal tourist visa, and then apply for a residency permit when in the country. 

However, for anyone looking to spend their later years in Germany, it’s still advisable to apply at their home country’s consulate at least three months in advance to avoid any problems while in Germany.

Retirement visas still aren’t as common as employment visas, for example, so there could be a longer processing time. 

What do you need to retire in Germany?

To apply for a retirement visa, you’ll need proof of sufficient savings (through pensions, savings and investments) as well as a valid German health insurance. 

If you have previously worked in Germany for at least five years, you could qualify for Pensioner’s Health Insurance. Otherwise you’ll need to apply for one of the country’s many private health insurance plans. 

Take note, though, that not all are automatically accepted by the Ausländerbehörde (foreigners office), so this is something you’ll need to inquire about before purchasing a plan. 

READ ALSO: The perks of private health insurance for expats in Germany

The decision is still at the discretion of German authorities, and your case could be made stronger for various reasons, such as if you’re joining a family member or are married to a German. Initially retirement visas are usually given out for a year, with the possibility of renewal. 

Once you’ve lived in Germany for at least five full years, you can apply for a permanent residency permit, or a Niederlassungserlaubnis. To receive this, you will have to show at least a basic knowledge of the German language and culture.

READ ALSO: How to secure permanent residency in Germany

Taxation as a pensioner

In the Bundesrepublik, pensions are still listed as taxable income, meaning that you could be paying a hefty amount on the pension from your home country. But this is likely to less in the coming years.

Tax is owed when a pensioner’s total income exceeds the basic tax-free allowance of €9,186 per year, or €764 per month. From 2020 the annual taxable income for pensioners will increase by one percent until 2040 when a full 100 percent of pensions will be taxable.

American retirees in Germany will also still have to file US income taxes, even if they don’t owe any taxes back in the States. 

In the last few years there has been a push around Germany to raise the pension age to 69, up from 65-67, in light of rising lifespans.

READ ALSO: EXPLAINED: Could people in Germany still be working until the age of 68?