ING CDC Pensioenfonds is cutting back the accrual rate of your pension in 2021. This article provides several sample calculations to show you how this will affect your pension.

Cutting back the accrual rate of your pension will have a direct impact on your pension. More information on the reasons for the decision is available here. The sample calculations in this article will help you estimate how the cutback will affect you.

Firstly, you should be aware that:

• Your pensionable salary comprises 12x your gross personal monthly salary plus your personal allowance for retention of salary, your personal allowance with indexation, holiday allowance and 13th month.
• The maximum amount of pensionable salary for 2020 is € 9,175.90 per month. (The maximum amount for 2021 has not yet been announced.) Any salary you earn in excess of this amount does not qualify for pension accrual.
• The minimum amount of salary which does not qualify for pension accrual is called the ‘franchise’ (€ 14,167 in 2020; the amount for 2021 has not yet been announced).
• Your pensionable salary net of the franchise is your pension base.
• The accrual rate targeted for 2021 was 1.784% of your pension base. This will be reduced to 1.196%.

Sietske (25 years of age)
Sietske’s pensionable salary in 2021 is € 50,000. After deduction of € 14,167 for the franchise, her pension base is € 35,833.

The tax allowable pension accrual rate targeted for 2021 was € 639 (1.784% of € 35,833). However, Sietske's pension accrual will be € 210 lower, i.e. € 429 in 2021 (1.196% of € 35,833).

Johan (46 years of age)
Johan’s pensionable salary in 2021 is € 75,000. After deduction of € 14,167 for the franchise, his pension base is € 60,833.

The tax allowable pension accrual rate targeted for 2021 was € 1,085 (1.784% of € 60,833). However, Johan's pension accrual will be € 357 lower, i.e. € 728 in 2021 (1.196% of € 60,833).

Evelyn (54 years of age)
Evelyn’s pensionable salary in 2021 is € 65,000. After deduction of € 14,167 for the franchise, her pension base is € 50,833.

The tax allowable pension accrual rate targeted for 2021 was € 907 (1.784% of € 50,833). However, Evelyn's pension accrual will be € 299 lower, i.e. € 608 in 2021 (1.196% of € 50,833).

Rob (61 years of age)
Rob’s pensionable salary in 2021 is € 120,000. This is more than € 110,111, the maximum pensionable salary, which means his salary qualifying for pension accrual is capped at € 110,111. After deduction of € 14,167 for the franchise, his pension base is € 95,945.

The tax allowable pension accrual rate targeted for 2021 was € 1,712 (1.784% of € 95,945). However, Rob's pension accrual will be € 564 lower, i.e. € 1,148 in 2021 (1.196% of € 95,945).