Lorraine Williamson
For the first time, the average retirement pension in Spain has exceeded €1,500 per month. Data released by the Spanish Ministry of Social Security indicates that pensioners now receive an average of €1,501 monthly, marking a 4.42% increase from February of the previous year, when the average was €1,437.
This milestone affects approximately 6.6 million retirees across the country.
Pension adjustments and inflation alignment
The recent increase surpasses the 2.8% revaluation implemented by the government, which was designed to align pensions with the previous year’s inflation rate. Notably, minimum pensions have experienced a more substantial rise, with increments ranging between 6% and 9%. These adjustments aim to preserve the purchasing power of pensioners amidst economic fluctuations.
Disparities in pension distribution
Analysis of pension distribution reveals significant variations based on age and gender. Retirees aged between 65 and 69 receive an average pension of €1,646, whereas those aged 85 and above receive €1,110 on average. Gender disparities are also evident; male pensioners receive an average of €1,717, while female pensioners receive €1,194. This discrepancy highlights ongoing challenges in achieving pension equality.
Increases across various pension categories
Beyond retirement pensions, other categories have also seen notable increases:
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Permanent Disability Pensions: Increased by 3.79%, from €1,161 to €1,205.
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Widow’s Pensions: Rose by 4.4%, from €893 to €932.
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Orphan’s Pensions: Experienced a 4.6% rise, from €501 to €524.
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Family Benefit Pensions: Increased by 5.3%, from €738 to €777.
Consequently, the average pension within the system has risen from €1,251 in February 2024 to €1,307 in the latest assessment. Notably, January marked the first instance where this average surpassed the €1,300 threshold.
Social security expenditure and demographic trends
In February, Social Security allocated €13,456 billion to contributory pensions, with old-age pensions accounting for €9,848 billion of this expenditure. The ministry has observed a trend towards postponed retirements, with 9.3% of current pension registrations being deferred, a significant increase from 4.8% in 2019. Conversely, early retirements have decreased to 29.6% of the total, down from 40% five years prior. The average retirement age has consequently risen to 65.2 years, up from 64.4 years in 2019. This shift is partly attributed to new incentives encouraging delayed retirement and adjustments to the early retirement framework implemented in 2022.
Also read: Where are the highest pension benefits in Spain?
Upcoming changes to legal retirement age
Looking ahead, the legal retirement age in Spain is set to increase to 66 years and eight months in 2025 for individuals with less than 38 years and three months of contributions. Those exceeding this contribution period will retain the option to retire at 65. These changes reflect ongoing efforts to adapt the pension system in response to demographic shifts and economic considerations.