In a notable surge, a record-breaking 44,600 individuals in the Czech Republic chose early retirement last year, marking a substantial increase of 20,000 compared to the previous year. This surge is attributed to changes in pension valorization, impacting the conditions and attractiveness of early retirement.

The significant influx of early retirement requests has had dual repercussions. Firstly, it has overwhelmed the Czech Social Security Administration, the entity responsible for processing these requests, resulting in delays in the system. Secondly, the conditions for early retirement have become less favorable since October.

Under the revised conditions, individuals can now opt for early retirement three years before their standard retirement date, as opposed to the previous five-year window. Furthermore, starting next year, prospective retirees will be required to have a work history of 40 years, up from the previous requirement of 35 years. The adjustments also mean that early pensions are subject to greater reductions, and until an individual reaches the standard retirement age, their assistance will not be valorized.

The data reveals a growing trend in the number and proportion of individuals opting for early retirement. Last year, a staggering 680,000 people received early retirement pensions. In 2010, early pension recipients constituted 19 percent of all total old-age pension recipients, and by 2022, this figure had risen to 28.8 percent.

In total, 2.37 million people received old-age pensions in the Czech Republic last year. Additional breakdowns include 414,000 individuals receiving disability pensions, 24,000 receiving independent widows or widowers pensions, and 39,000 receiving orphans’ pensions. Despite the uptick in early retirement, the overall number of old-age pensioners experienced a slight decrease of 10,600 compared to the previous year.

Article by Prague Forum