How to receive pensions and continue to work?

The pension reform designed by the Minister of Inclusion, Social Security and Migration, Jose Luis Escriva, has among its main objectives that those over 65, an age which, if it is proven that they have contributed 38 and a half years, allows them to retire without penalty, to remain in the labor market as as long as possible and to continue to generate income for the system, also avoiding additional expenditure on benefits. The Minister of Pensions insisted that delaying retirement for just a few months has a very positive effect on the system and helps to guarantee the payment of benefits in the medium and long term.

With the incentives already in force since January aimed at workers delay your retirement, there are many mechanisms – active, partial, modulated or deferred retirement – which make it possible to combine the receipt of these benefits with a job and to remain active after the age of 65. There is practically an alternative for each profile, but the fear of too low a pension is at the root of most of the decisions that opt ​​for the continuation of the activity despite the fact that the mental and physical response is not the same as that of a young person. the person.

What retirement pension do I have?

The Labor Force Survey (LFS) and oem statistics from current or previous reforms, or income requirements, there are more and more workers over the age of 65 who, although not reaching that age, are retired and, at the same time, receive part of his pension. Up to 315,000 workers, an insignificant percentage of the total but which will continue to increase in the years to come, were working after the age of 65, despite the difficulties of keeping a job or finding a new one at that age.

Meanwhile, last year, 288,000 pensioners and pensioners with severe or absolute disability and citizens over the age of 65 were registered with the public employment services as job seekers. Under no circumstances is this large number of applicants counted as unemployed. Forman leaves from a group in which both are the applicants that request an employment for a period inferior to 3 months, the student menores of 25 years that buscan su primer trabajo, the assistants to a course of professional training or the quieren teletrabajar or hacerlo abroad.

How to receive the full pension and continue to work… and contribute

Social Security highlights all the means and options to obtain additional income to compensate for the pensions which, in the 53% of cases do not reach 1000 euros. The law specifies that it is possible to make the allowance compatible with part-time work, for example. In this situation, the pension payment will be lower in proportional to the working time, which means a salary. Along with this possibility, the Ministry points out that the retirement pension is also compatible with self-employment, the total annual income of which does not exceed Minimum Interprofessional Wage (SMI) -€1,000 in 2022-.

It is also possible to retain ownership of a business and the performance of the functions inherent in that ownership. In addition, the retirement pension is compatible with the exercise of the activity of health professionals Retired doctors and nurses under 70. These professionals may be reinstated in active service by the competent authority of the autonomous community, in accordance with the provisions of article 13 of Royal Decree 463/2020, of March 14. This reincorporation can be both full-time and part-time.

Active retirement allows you to receive half of your retirement pension, but the self-employed benefit from a series of very attractive advantages

News and requirements of Active Retirement for the self-employed

In the meantime, another option that interests more and more retirees is the active retirement, which allows to receive the contributory retirement pension and at the same time to exercise any employment as an employee or self-employed with a series of conditions. Thus, access to the pension must have taken place at least one year after reaching the ordinary retirement age, so that those who have anticipated their retirement are excluded.

In the case of active retirement, the amount of the retirement pension will be equivalent to 50% of the amount of the recognized benefit, although if the activity is carried out on his own account -independent- and it is proven that he has hired at least one employee , the amount of pension compatible with work will reach 100%. The sixth bis final provision of the LGSS It also provides for the possibility of extending this 100% compatibility to salaried workers and other self-employed workers in the future.

In addition, it is envisaged that the pension will be revaluate in full according to the CPI, these benefits will therefore increase by 8.5% next year. However, as long as the compatible employment is maintained, the amount of the pension increased by the cumulative revaluations will be reduced by 50%, except in the case of self-employed activity with employees. Pensioners will not be entitled to the minimum supplements during the period during which the pension is compatible with work. The most notable exception is that this type of retirement excludes senior civil servants in the public sector.

Deferred retirement, a retirement with multiple incentives

From January 1, postponing retirement beyond the ordinary age can be profitable. Among the novelties of the new law on the guarantee of purchasing power pensions and other system-strengthening measures, there is the increase in incentives to prolong working life and delay the retirement age, known as delayed retirement. According to Social Security, there is the possibility of receiving a single lump sum compensation per year of delay. The amount, which varies between 5,000 and 12,000 euros, varies according to the years of contributions credited on the date of your ordinary retirement. An additional 4% is also possible for each full year contributed after reaching ordinary age.


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