Maternity pension: this is how the time spent raising children affects your pension

Maternity pension: The most important facts in brief

For the period of child rearing, mothers or fathers are placed in the same position as if they had paid pension contributions according to the calculation of an average value.

How much maternity pension a woman receives depends on how long she has raised her children. One year of child-raising time increases your pension by around 34 euros per month.

Your child was born before 1992: You are credited with up to 2 years and 6 months of child-raising time per child.

Your child was born in 1992 or later: your credit for child-raising time can be up to 3 years per child.

In order to get the maternity pension, your child-rearing periods must be registered with the German pension insurance. The form for this is available online.

Old-age poverty is too often female. A common reason is that we women interrupt our careers for something much more important: our children. Because of pregnancy, child-rearing and childcare, mothers often earn lower pension entitlements because they pay less into the pension fund. And later switch to part-time or mini-jobs.

On the other hand, children in particular – apart from their value and emotional, biological and ethical aspects – are important basis for the intergenerational contract. It is proper that women receive compensation for the periods in which they care for their young child and cannot work gainfully.

Governments across Europe have acknowledged this. And this is where the Mutterrente comes into play, a pension benefit for parenthood. Who is credited with child-rearing periods? Can you divide them? How much pension do housewives get who have spent their whole lives only caring for children?

All info summarized in the video:

Definition: What is maternity pension and who gets it??

First of all, you should know that the maternity pension is not a pension in its own right. It is also not a pension from mothers. Some voices describe the term as a buzzword from the election campaign. Yes, may be. Nevertheless, the "mothers’ pension" is supposed to stand for improved recognition of child-raising periods under pension law. For children born before 1992. For them, first one year of parental leave was recognized years ago, then two and now two and a half years.

With the Mutterrente II and the additional six months, a fairer treatment of parents should be achieved. The aim is to equalize the pension with the pension of parents who have children after 1992 and who are credited with three years of child-raising time.

Thanks to the adjustment by the maternity pension, a mother (or father) who raises her child can increase her statutory pension. And some women are able to earn a pension entitlement in the first place as a result. A rather measly one, but still. Because for the child-rearing periods they are credited pension points (also called Entgeltpunkte).

Who gets maternity pension

Pension rights for bringing up children are given to the parent who has predominantly brought up the child. Consequently, almost exclusively the birth mothers.

If you have raised your child together with your partner, the child-raising time is usually automatically assigned to the mother. But you can say that you want to divide the child-rearing periods among yourselves. In addition to biological parents, adoptive, stepparent and foster parents can also have their child-raising years credited to them.

In order for the maternity pension to be credited, the child-raising period must have taken place in Germany. Child-raising periods abroad are only taken into account in exceptional cases and must be applied for from the pension insurance fund.

How many years are counted per child for pension purposes?

Let’s have a look at the Social Security Code § 56: "Child-raising periods are periods of raising a child in its first three years of life". Means that mothers are credited with three years of compulsory contributions by the statutory pension insurance for each child they currently give birth to.

As already mentioned, this applies to all births after the age of 1. January 1992. Mothers or fathers whose children were born before 1992 are recognized 2.5 child-raising years per child. Child-raising periods up to the age of 10. Unfortunately, the following years are not taken into account.

Examples for the calculation of the child-raising period:

Example 1: Susanne and her little Leo

Birth of Leo 8. June 2005
Child-raising time 1. July 2005 until 30. June 2008

Example 2: Martina and her Jessica

Birth of Jessica 8. June 1989
Child-raising period 1. July 1989 to 31. December 1991

Source: German Pension Insurance

You take care of several children at the same time? For example, twins or because a baby is born during a child-raising period, for which child-raising periods are also to be taken into account? Then the child-raising period is extended by the time during which you simultaneously cared for several children.

Example 3: Simone and her children Jacob and Miriam

Birth of the first child Jacob 17. April 2002
Children’s education time 1. May 2002 to 30. April 2005
Birth of the second child Miriam 2. January 2004
Child-raising time 1. February 2004 to 31. January 2007
Extension period 15 months 1. February 2007 to 30. April 2008

Source: German Pension Insurance

Conclusion: For each child born after 1992, up to three years can be credited as compulsory contribution periods by the German pension insurance in the insurance history. If a woman gave birth to four children from 1992 and raised them, she will be credited with up to twelve years of child-rearing time. Source: German Pension Insurance

Unequal treatment of mothers does not constitute discrimination under the law. But child-rearing periods for children born before and after 1992 are not equivalent in terms of pensions. The Federal Social Court (Bundessozialgericht) decided this in a ruling issued on 11. October 2018 announced judgment (Az.: B 13 P 34/17 R). Many associations, including the social association VdK, have long opposed the unequal treatment.

Increase of the maternal pension: How is it currently calculated?

Your child-rearing periods count when it comes to fulfilling the waiting periods for the various pensions. And they bring a small pension plus, thus more money with the pension payment.

Because for each year of child-rearing time, you are credited with almost one earning point on your pension account. Thus, one year of child rearing brings a monthly pension increase of 34.19 euros in the West and 33.47 in the East (as of January 2022). The last increase in the maternity pension took place in the course of the 2019 pension reform, when the maternity pension II was introduced.

Does the maternity pension also apply to fathers??

In principle, child-raising periods are automatically credited to the mother. If both parents are caring for the child, they can share the child-rearing periods.

The parents may divide the times among themselves. You could determine that the first 24 months of child-raising time are credited to the mother and the following 12 months to the father.

Parents must jointly submit a declaration of division to the German pension insurance fund. This means that child rearing is divided up as you like without any further evidence and usually without any demand from the pension insurance company.

You can make the division arbitrarily. Even if one parent hardly took care of the upbringing of the common child, he or she can have times credited to him or her. No one should check this. Such a distribution can make sense if you, as a parent, would hardly benefit from child-raising time. Since you have, for example, acquired high pension entitlements through your contributory employment during this period.

So if you are a high-income earner, you should do a check-up with an expert. Together you can check whether it would not make more sense to transfer the child-raising time to your husband in order to increase his pension entitlement. Anyone who wants to transfer earnings points or has general questions about their insurance status should request an appointment with the German Pension Insurance (Deutsche Rentenversicherung).

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Must the maternity pension be applied for?

You do not have to apply for the maternity pension. Only adoptive and foster parents who want to claim a maternity pension must submit an informal application to their competent pension insurance institution. However, in order for the maternity pension to be paid out, the child-raising periods must be applied for and recorded in the pension account. You can find the application form here.

Will the maternity pension be taxed?

According to the German Federal Ministry of Finance, the maternity pension is taxable as part of the old-age pension. This is an extraordinary pension adjustment, the pension allowance has to be recalculated accordingly.

If you receive a maternity pension, you do not have to show it separately in your tax return. It is reported to the tax office as a part of the old-age pension by the German Pension Insurance Federation. That automatically recalculates the pension allowance based on the data. Anyone who would like an exact calculation or further advice should contact Lohnsteuerhilfe or another expert such as a tax consultant.

Women receive on average 26% less pension than men.
Why this is the case and what you can do about the gender pension gap.

Taking the child-raising period into account for the basic pension

If a woman has a pension that is too low, she may apply for basic old-age assistance. The crux of the matter is that the maternity pension can reduce this amount, because it is counted as income toward the basic pension.

The rationale: it is a component of the pension and complies with the principle of the subordination of the basic pension. "It would be unacceptable to insured persons with compulsory contribution periods from gainful employment that pension income from child-raising periods would be treated better than pension income from gainful employment with regard to the income to be offset against basic security," writes the Federal Ministry of Labor and Social Affairs in this regard.

Here there is criticism and also suggestions for improvement from many sides. The social association VdK, for example, demands that there should be an allowance of 200 euros.

As a further special benefit for parents, there is the so-called child allowance period of the statutory pension insurance for the period between the third and tenth birthday of a child. In many cases, this special benefit can ensure that periods of employment subject to social insurance contributions are valued more highly and that the mothers are entitled to the basic pension.

Example: A mother gave birth to a child in January 1973, 1978 and December 1984. The period from January 1973 to December 1994 – 22 years – is counted as a child consideration period and thus as a basic pension period. To get to a basic pension entitlement, the woman would need another 13 years of compulsory contribution periods.

Women can apply for the child allowance period at the German Pension Insurance (Deutsche Rentenversicherung) using form V0820. Without this application, the periods do not count in the calculation of the pension.

What can women without a pension claim try?

Older women who have never worked gainfully, but have only taken care of children and the household, may be able to apply for a small pension of their own since the introduction of the maternity pension.

For one’s own pension entitlement, one needs at least five years of contributions. This requirement is also met by women who have never had a job but have previously raised two children. They now come to the five important contribution years.

A pure housewife who has "only" raised one child is still missing 2.5 years of contributions. Attention: You can acquire them. by paying additional contributions. The best way to find out whether this is worthwhile and what amounts we are talking about is to talk to the German pension insurance.

Whether the maternity pension will actually compensate for women’s loss of income in old age is another issue. Also where the money for maternity pensions comes from and whether the 2.5 / 3 split is a fair split.

herMoney tip

On the one hand, the statutory pension is based on a shaky framework, and on the other hand, it should really only be a building block of old-age provision. Please take care in time for further building blocks for your protection in old age. Self-employed people, for example, can think about the Rurup pension, employees about the company pension or Riester. You can find more options in our article on the so-called longevity risk of women.

You would like to know how many pension points you have already accumulated? In the pension information you can read how high your pension including maternity pension is expected to be. Not to be confused with the pension notice you get later as a retiree.

Ines Baur started her journalistic career in television. After the birth of her third son, the trained banker specialized in print and online media. Her main focus is writing about women and finances, women and retirement planning, women and financial independence.

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