The Bank of Spain has calculated Extending the calculation period for retirement from 25 to 35 years would mean an 8.2% reduction in the average starting pension.according to the occasional document on pensions released by the business this Wednesday.
According to the report, the gradual extension of the calculation period 15 to 25 years (one year every year since 2013) already a 5% decrease in average first pension.
However, removing the most unfavorable years for determining the regulatory base and increasing the calculation time to 35 years would allow for smoothing or even improving the decline in the average starting pension.
Using the optimal period of 25 to 28 years in the 35 years before retirement, the average initial retirement would be lower if the higher average initial retirement was calculated from the optimal 30 to 34 years.
The neutral point would be to consider the optimal 29 years, since it will give an average pension similar to that obtained by taking into account the 25 years before retirement.
However, a plan that only allows for the worst 12-month contribution to be ruled out in the 35 years before retirement means that the average starting pension will be 6.5% lower.
Overall, the possibility of discarding the most unfavorable years will benefit workers affected by gaps in contributions or periods of unemployment, as well as below-average pensions, so that the disparity in the amount of new benefits will be slightly lower.