To use this site, please disable the ad blocking feature and reload the page.
This website uses cookies to collect information about your visit for purposes such as showing you personalized ads and content, and analyzing our website traffic. By clicking “Accept all,” you will allow the use of these cookies.
Users accessing this site from EEA countries and UK are unable to view this site without your consent. We apologize for any inconvenience caused.
It has become possible for people to put off receiving public pension benefits until as late as 75 if they wish. It is crucial for the government and companies to exercise wisdom to realize a society in which people can work even at an advanced age and live actively throughout life.
In principle, the age at which people are eligible to start receiving pension benefits is 65, but under the previous system, recipients could delay until 70 if they desired. Based on the pension-reform legislation enacted in 2020, from last month people became able to delay receiving benefits for another five years.
Under the new system, the longer people delay pension benefits, the higher their monthly benefits will be when they receive them. For example, those who start receiving benefits at 75 will be paid 1.84 times more monthly benefits than those who start at 65. The increased amount will last the rest of their lives.
The reform is aimed at encouraging people to work without relying on a pension when they are healthy, and to live on their increased benefits and other financial resources after retirement.
Many people want to work even when they are over 70 years old, looking ahead to the era of 100-year lifespans. Widening options by raising the age to start receiving the benefits apparently fits with the times.
However, it remains to be seen how many people will actually opt for the delay.
So far, only about 1% to 2% of pension recipients have delayed the start of benefits. The new system is not widely known, but many people evidently do not find it advantageous.
The government should make efforts to raise awareness of the new system by explaining it thoroughly.
Even though the amount of pension benefits increases as a result of deferral, the burden of tax, medical insurance premiums and other payments could increase if people have certain levels of income. It is necessary to provide information on such aspects to make it easier for them to make a decision.
Along with the pension system reform, it is also imperative to build a society in which the elderly can work for a long period of time so far as they are willing and able, to enable them to live with peace of mind.
The employment rate for those in their early 70s was 22% in 2010 but rose to 33% in 2020. However, nonregular employment is common for this age bracket, and their job options are limited.
The central and local governments should cooperate with companies and business organizations to improve the employment environment for the elderly. When people become advanced in age, individual differences in health and physical fitness widen. It is hoped that more opportunities will be created for the elderly to play an active role in society through meticulous measures.
The Law on Stabilization of Employment of Elderly Persons, for which revisions took effect in April last year, requires companies to make efforts to allow their employees to work until 70 even though they have passed the threshold of 65.
In addition to calling for abolishing or extending the retirement age and introducing a system to continue employing the elderly, the revised law also seeks for companies to take such steps as signing outsourcing contracts with senior employees after their retirement. It is hoped that the labor and management sides will fully discuss the issue based on the current workplace environment.
