The future of ten employees financial security will largely depend on the Dutch pension plan. It is important to understand how this plan works and which benefits they will be entitled to. It is also important to understand the choices they can personally make with respect to your pension plan. After all, it is their retirement plan. We have set out the options so that they can make well-informed decisions and choose the Dutch pension plan that meets their individual needs. Please check also the state pension arrangements.
The options described below do not apply to every pension scheme. Which options apply will depend on the pension plan your employer has selected. If you want to know which conditions and choices apply to the employees, check your copy of the pension regulations or review the introductory letter you received from the insurer when you started as a company the pension scheme.
Options Dutch pension plan
Pension plans in Dutch pension plan offers members a range of options. It is important to make sure that you are properly informed on options such as:
- Opting for a higher pension (the benefit they will receive upon retirement) in exchange for a lower partner’s pension (the pension your partner will receive after your death) and
- a higher partner’s pension
- Retiring earlier or later.
- Opting for variable pension benefits.
- Part-time pension.
Higher Dutch pension plan
In most pension schemes, an employee build up entitlement to the pension as well as well as to that of the partner. This is intended to ensure a subsistence level of income for a surviving partner, but subject to certain conditions, they can exchange some or all of their partner’s pension for a higher pension. This exchange does, however, require the partner’s consent. In that case you can trade in the partner’s pension for a higher Dutch retirement plan starting at the age of 67/68, for instance, or for early retirement without reduction of the benefit.
Higher partner’s pension
If an employee have a partner, it is possible to use part of the pension pension for a partner’s pension or additional partner’s pension, It is subject to tax limits. This means that the family will still be provided for even after your retirement date on the Dutch retirement plan. Rest assured, they do not need to decide until they actually retire.
Retiring earlier or later
They can choose to retire earlier or later. Bear in mind that if they wish to postpone the payment of this pension, they will need to continue working up until the chosen pension date.
If you want the pension of your employee to start before the pension date, it is advisable to discuss this in advance. Remember that they will not receive a state old-age pension until you are 67/68.
If an employee works longer before claiming the pension, they will receive a higher Dutch pension plan.
Opting for variable Dutch pension plan benefits
The pension scheme may allow an employee to vary the amount of the pension within certain limits. This is a useful option if, for example, they expect that they will need more income immediately after pension than when they are older. This is often referred to in pension regulations as the high/low construction.
It is sometimes also possible to work part-time before pension. The pension starts immediately. He of she will then work part-time and receive pension payments to supplement the income. Check the pension regulations in a Dutch pension plan to verify whether this option is provided for in the pension scheme.
If they have a partner’s pension on a risk basis they cannot use it for additional pension as it is a risk insurance to guarantee an income for the partner if he/she die before retirement date while still working for you as an employer. Contributions will stop on retirement date and so the entitlement to the partner’s pension also ends. They can, however, choose to convert all or part of the retirement pension to a pension benefit for the partner, if he/she have one. The Dutch pension plan is one of the best funded pension plans in the world.
.If you think I might be able to help your business
Gerrit-Jan Doorneweerd, registered Pension Advisor,
Amsterdam, +31 (0)20 6200825
Mobile, 0651 471 9 – six – five. (Also in the evening and weekend.)
Please give me a call of fill in this page for more information