National Pension Termination Spouse Death Early Receipt of Survivors’ Pension Future Prospects (Depletion) Complete Arrangement
Find out how to cancel the national pension, survivor’s pension in case of death, how to receive it early and future prospects.
1. Termination of National Pension
Recently, there has been a lot of controversy over the financial status of the National Pension Service and the stability of the National Pension Service. Because of this, young adults who are working hard are worried that paying the national pension is not a form of pouring water into a bottomless pot. To start with the conclusion, since the national pension is a compulsory insurance, it cannot be canceled except for some specific reasons. It is mandatory for Korean citizens to join the National Pension Plan in order to prepare for their old age. However, there are several reasons for termination. It is time to prove that you are not a citizen of the Republic of Korea. In other words, you can cancel the national pension when you lose your citizenship or move abroad. When such a reason occurs, the person himself/herself needs to cancel the national pension and receive the pension amount temporarily. You must apply directly to the National Pension Service, and in some cases, you may need documents to prove it. If you lose your nationality or migrate, the National Pension Service cannot automatically know this. Therefore, when the relevant reason occurs, the person who wishes to cancel the policy must directly apply for cancellation to the National Pension Service. You must receive your pension in accordance with that procedure. The period during which cancellation is possible is 5 years from the date of occurrence of the reason. Please note that after these 5 years have elapsed, you will have no choice but to receive it in the form of an annuity rather than a lump sum.
2. Spouse Death and Survivors Pension
If a spouse who was receiving the national pension dies, it is possible to receive it in the form of survivors’ pension. In addition, when a person receiving an old-age pension dies or a person receiving a disability pension with a disability level 2 or higher according to the Welfare of Persons with Disabilities Act dies, survivors’ pension can be received. At this time, the beneficiaries of the survivor’s pension will be paid according to the priority of the survivor’s family. The first priority is your spouse. There is no age limit for a spouse to receive a survivor’s pension. However, if a spouse does not exist, there is an age limit for the next priority. Next in priority are children, then parents, then grandchildren, and finally grandparents. At this time, the age restrictions include children under the age of 25 or those with a disability level of 2 or higher according to the Disabled Persons Welfare Act, parents and grandparents who are 62 years of age or older or those with a disability level of 2 or higher according to the Disabled Persons Welfare Act, and grandchildren of age A. If you are under the age of 19 or if you have a disability grade of 2 or higher according to the Welfare of Persons with Disabilities Act, you are recognized as a bereaved family. The amount of survivors’ pension is determined according to the period in which the national pension was paid. If the period is more than 10 years and less than 20 years, 50% of the pension amount is paid. And if you have been enrolled in the national pension for more than 20 years, you will receive 60% of the pension amount. However, these amounts cannot exceed the amount of the old-age pension received by the deceased National Pensioner. Then, let’s see what happens in the case of remarriage. If a person receiving a survivor’s pension remarries or dies, the right to receive the survivor’s pension is recognized to be lost. Therefore, it is not paid to the spouse, but if there are children who meet the conditions at the time the right to benefit ends, those children can receive survivors’ pension instead. The condition is that the child is a child of a person who has received an old-age pension and is under the age of 25, or a child who has been classified as a grade 2 or higher disabled person under the Welfare of Persons with Disabilities Act before reaching the age of 25.
3. If early pickup is possible
If you want to receive the pension before the age at which you start receiving the national pension, you must meet the following conditions. First of all, you must have been enrolled in the pension for at least 10 years, and you must meet the age conditions appropriate for your year of birth. You must also have no income, and you must apply in person. The starting conditions differ depending on the year of birth. Those born between 1953 and 1956 are eligible for early receipt at age 56. Those born between 1957 and 1960 are eligible for early age 57. People born between 1961 and 1964 are eligible for early receipt at age 58. People born between 1965 and 1968 can receive it at age 59. Those born in 1969 or later must be 60 years old to receive early receipt. Please note that the starting year and the age at which early receipt is possible differs depending on the year of birth. And the condition that there should be no income does not necessarily mean that the income must be zero. If the sum of earned income and business income for one year exceeds the monthly average of KRW 2,681,724 as of 2022, this is considered income.
4. Future Prospects (Depletion)
It is not just yesterday or today that future generations have problems with receiving the national pension. Since it is compulsory insurance, it is compulsory to pay insurance premiums every month, but I am uneasy about whether I will be able to receive the principal of this insurance later. This is the result of the financial uncertainty of the National Pension Service, which manages and operates the National Pension Service, and the negative perception of the National Pension Service. In fact, if the state does not take any fiscal measures and the pension depletion continues in this state, the future of the national pension for the current youth is bound to be dark. However, this is just an assumption. Let’s look at some examples from European countries. There are quite a few countries that provide pensions only with the contributions paid by the national pension subscribers, rather than by operating the national pension with the amount accumulated continuously like Korea. In other words, it is not in the form of a reserve (settlement) to accumulate insurance money, but in the form of paying insurance money with premium income. Also, unlike private insurance, the national pension has the advantage of reflecting the inflation rate. For private pension insurance, which individuals voluntarily sign up for, if they pay an insurance premium of about 1 million won, they will receive 1 million won 10 or 20 years later. However, the national pension is paid by reflecting the inflation rate, and in fact, the payment amount continues to rise. If we consider the sad reality that our wages do not keep up with the inflation rate, we can have hope that the national pension still reflects the inflation rate. Of course, we shouldn’t stay only with positive thoughts to prepare for our old age. This is because the national pension is only the minimum preparation for old age. Individually, in preparation for old age, various income pipelines should be established, and individual retirement pensions and various methods should be used to prepare for old age. Not only individuals, but also the government should make social preparations together. We hope that everyone will have a happy retirement by preparing for a stable retirement.