Can't Earn a Pension Without a Job History
- by Matthias Urbach
- 3 Min
If you've led a life without employment or contributions, this is the pension amount you'll receive. - Inattention to work or pension remuneration leads to such consequences.
Let's get this straight: No work, no pension.
There's a slight exception for parents who've raised more than one kid. They can stake a claim for a pension, but only if their country's pension system acknowledges homemaker work. Want the deets? Keep reading.
- Pension
- Basic Security
- Retirement Provision
- Pension Claim
Now, what about those parents who've been nurturing mini-humans instead of racking up work hours? Their pension insurance might actually recognize child-rearing work as a valid claim. Here are some broad strokes:
Canada
In Canada, the Canada Pension Plan (CPP) offers a helping hand to those who've taken a break for child-rearing. Although there's no such thing as a "child-rearing pension," parents can request child-rearing drop-out provisions when applying for CPP retirement benefits. As a result, certain years can be omitted from the pension calculation, boosting the benefit amount. However, it's all about refining the pension calculation, not strictly claiming a pension for child-rearing work.
On the flip side, the Canada Pension Plan does provide a children's benefit for children of deceased or disabled contributors. But this isn't connected to the parent's work history in child-rearing.
United States
In the United States, there's no federal pension system that caters to child-rearing work. However, some companies offer leave benefits, or other childcare support. Certain states also offer programs with childcare-cost assistance or incentives, but these aren't standard pension benefits.
Other Countries
Various countries might have unique setups. For instance, some European nations offer childcare payments or parental leave, though these usually aren't part of a retirement plan.
In short, while child-rearing work-related benefits exist in different countries, few pension systems offer a pension claim specifically for homemakers without employment elsewhere. Benefits are typically tied to employment history or family support programming, rather than a traditional pension scheme.
- In Canada, parents who have taken a break for child-rearing can request child-rearing drop-out provisions when applying for Canada Pension Plan (CPP) retirement benefits. This allows for certain years to be omitted from the pension calculation, potentially increasing the benefit amount, even though there is no 'child-rearing pension'.
- Those who are planning their personal-finance and wealth-management for retirement might want to consider vocational training opportunities, as having a comprehensive work history might be crucial for claiming pension benefits in many countries, including Canada and the United States.
