Day 5: A problem known as the pension gap

The pension gap refers to the difference between what you receive as your government retirement payouts and the amount you previously earned. When you look at what the average retirement payout is, you realize that this difference is alarmingly significant. To close your personal pension gap, you should take responsibility of your financial future into your own hands and think about opportunities for closing the gap.


If you don’t know how much your retirement payments will be as of now, the first step will be to have this calculated by the DRV and compare it with your current salary. There are also online calculators that can give you at least an initial idea. We’re also giving you an example here of Caroline, a fictitious woman from Hamburg. Let’s take a look at Caroline’s pension gap.


A concrete example: Caroline from Hamburg

Caroline is 30 years old and has a gross income of 4000 euros per month. She has been working since she was 25, is in tax class 1, and does not pay church tax. She works in Hamburg.


Caroline’s pension gap amounts to 1140.27 euros.

Her current income minus this amount is what will be available to her as a retiree. Her expected pension amounts to 55.12% of her current net salary.


Gross monthly income: 4000.00 euros

− Social security: 799.00 euros

− Taxes: 660.50 euros

= Current net monthly income: 2540.50 euros


− Standard pension: 1,750.54 euros

− Social security: 192.56 euros

− Taxes: 157.75 euros

= Future net retirement: 1400.23 euros


This example shows that Caroline will have government retirement payouts of a little more than half of her current income. Now imagine you’re 67 years old and now just have half the income you were previously bringing in. Is that going to be enough?