Planning Retirement: Practical Steps for Russians Aged 35–40
Experts advise that retirement planning should begin in the mid-life years. Olga Daineko, a specialist at the Research Finance Institute under the Ministry of Finance, outlines practical strategies for increasing future pension benefits. The discussion centers on how the insured pension is formed from a fixed state portion and the number of individual pension coefficients (IPCs).
As long as a person works and earns salary, contributions flow into the retirement pot. Higher income leads to larger contributions and more pension points each year. IPC is then multiplied by the retirement date coefficient. The maximum IPC accumulation today sits at ten points per year. Delaying retirement can lead to higher monthly payments, with women eligible for retirement at 60 and men at 65 in many cases.
A delay of a few years can meaningfully increase both the fixed portion of the pension and the IPC total. In practical terms, a three-year postponement might boost the fixed payment by around 19 percent and raise the IPC amount by roughly 24 percent.
Planning ahead involves assessing both the insurance coverage amount and the number of IPCs. Individuals can verify these figures using their personal account on the government services portal. If retirement is approaching but IPCs are insufficient and cannot be increased quickly, there is a possibility to purchase additional pension experience.
Purchasing additional pension experience refers to voluntary insurance contributions made independently. To pursue this, a person should contact a regional office of the Russian Social Fund, submit an application, and transfer the required contributions by December 31. This provision allows for the purchase of standard insurance experience, but special experience, such as northern allowances, cannot be bought.
It is possible to buy up to half of the needed experience, with exceptions for those who pay certain qualifying contributions. This option is not limited to the individual alone and can be arranged for another person as well.
In addition to these core approaches, several supplementary options exist for enhancing retirement readiness. These include a non-state pension fund, a bank deposit strategy, an individual investment account, and real estate leasing income.
To qualify for an old-age insurance pension in a given year, the minimum required insurance period and IPC threshold are established and updated over time. The discussion of retirement planning remains relevant for individuals seeking to maximize future benefits and ensure financial stability in later years.
Historically, pension distributions vary based on employment history, earnings, and regulatory changes. The ongoing question for many is which combination of actions best aligns with personal circumstances and long-term financial goals.