Opting out of Japanese pension

[martininjapan1]

Hello,

I would like to know if somehow it is possible to opt out of the Japanese pension scheme while being a permanent resident.

I personally know Japanese people who did so. However I am not sure if this is doable as a foreigner.

Appreciate anyone ideas.

Thanks.

[RetireJapan]

Hello,

I would like to know if somehow it is possible to opt out of the Japanese pension scheme while being a permanent resident.

I personally know Japanese people who did so. However I am not sure if this is doable as a foreigner.

Appreciate anyone ideas.

Thanks.

All residents of Japan must pay into nenkin, either kosei/kyosai nenkin through their employer, or kokumin nenkin through the city office. If people have very low income or financial difficulties, they can apply to pay a reduced rate or not pay at all while still getting credit toward their pension.

[goran]

I would like to know if somehow it is possible to opt out of the Japanese pension scheme while being a permanent resident.

Just out of curiosity, why would you want to do that?

[TokyoBoglehead]

I would like to know if somehow it is possible to opt out of the Japanese pension scheme while being a permanent resident.

Just out of curiosity, why would you want to do that?

General anxiety and conspiracy theories relating to the solvency and stability of the pension plan has caused many Japanese people and expats to not pay their dues.

What's hugely tragic is these individuals often due not invest or save what they should have paid, leaving them in a rough spot in their later years.

Shooting yourself in the foot with both barrels of you will....

[zeroshiki]

Purely anecdotal but something like 1 in 5 Japanese people who I've talked to about this will go into that whole "pension is a scam, the government is stealing our money" diatribe. It's frankly terrifying. Most foreigners don't know enough to even do that but alot of them think of pension as just a cost and not as something that will benefit them in old age.

[captainspoke]

Hello,

I would like to know if somehow it is possible to opt out of the Japanese pension scheme while being a permanent resident.
...

With PR, don't you already have enough time/payments in to qualify for a pension?

I suppose with some of the newer tracks your time in country could be less, but still, with PR--you're going to stay here, right?--why worry about or even consider this?

[adamu]

I personally know Japanese people who did so.

There's no such thing as opting out. If you have a job, you pretty much pay automatically via salary deductions.

If you are supposed to pay yourself, you can refuse to pay. But this is not an opt out, it will go on record as an unpaid period, which is treated negatively in immigration procedures to give one example (for example, if you wanted to naturalise, or sponsor someone else's immigration procedures).

[martininjapan1]

I personally know Japanese people who did so.

There's no such thing as opting out. If you have a job, you pretty much pay automatically via salary deductions.

If you are supposed to pay yourself, you can refuse to pay. But this is not an opt out, it will go on record as an unpaid period, which is treated negatively in immigration procedures to give one example (for example, if you wanted to naturalise, or sponsor someone else's immigration procedures).

I agree, there is no such thing as opting out, but the fact is lots of Japanese people - not the majority - refuse to pay. Often in my experience they are self-employed.
You can choose to pay yourself or through the company you work for, depending on their policy.
I am just curious about the risk of losing permanent residency IF you decide to stop paying.

Hello,

I would like to know if somehow it is possible to opt out of the Japanese pension scheme while being a permanent resident.
...

With PR, don't you already have enough time/payments in to qualify for a pension?

I suppose with some of the newer tracks your time in country could be less, but still, with PR--you're going to stay here, right?--why worry about or even consider this?

I got PR with 6 years living in Japan, including 2 years where I was exempted of nenkin because I was paying in my country. So I don't think I have enough payments to quality for a pension at the moment. Having PR doesn't mean I've decided to stay here all my life. I'm just trying to understand what are my options.

Purely anecdotal but something like 1 in 5 Japanese people who I've talked to about this will go into that whole "pension is a scam, the government is stealing our money" diatribe. It's frankly terrifying. Most foreigners don't know enough to even do that but alot of them think of pension as just a cost and not as something that will benefit them in old age.

My Japanese acquaintances told me similar things and some of them feel bad about their decision, other don't care because they have enough money to live by themselves. However, I don't have as much confidence in the pension system as you seem to have.
To me there are several issues, one being inflation.

I would like to know if somehow it is possible to opt out of the Japanese pension scheme while being a permanent resident.

Just out of curiosity, why would you want to do that?

As said above, this is more to know about my options and managing my money. I've not decided anything at this stage. If I'd decide to avoid paying, it would be because I'm confident that I can use this money to get a higher yield and because I'm sure I would not lose my visa.

Hello,

I would like to know if somehow it is possible to opt out of the Japanese pension scheme while being a permanent resident.

I personally know Japanese people who did so. However I am not sure if this is doable as a foreigner.

Appreciate anyone ideas.

Thanks.

All residents of Japan must pay into nenkin, either kosei/kyosai nenkin through their employer, or kokumin nenkin through the city office. If people have very low income or financial difficulties, they can apply to pay a reduced rate or not pay at all while still getting credit toward their pension.

Thank you for your quick reply and for creating this forum.
I was aware about this requirement, yet beyond what's required in Japan and the reality of everyone' situation, I find it interesting to learn about the story and experiences of everyone living there as a foreigner.

[RetireJapan]

I agree, there is no such thing as opting out, but the fact is lots of Japanese people - not the majority - refuse to pay. Often in my experience they are self-employed.

The only way to avoid paying nenkin is to not be enrolled in kosei/kyosai nenkin and evade the payments. This is similar to not paying income tax, except that enforcement is still not as strict as it could be.

I predict that the My Number system etc. will result in a crackdown on nenkin non-payment.

More importantly, not paying nenkin means you won't get a state pension in old age.

A state pension is a way to diversify your income in retirement, and lock in an income floor. Nenkin payments are also tax-deductible, and allow you to use iDeCo (which you can use to reduce your taxable income by up to 68,000 yen a month).

For all these reasons I believe not paying the 16,000 yen a month for kokumin nenkin is a foolish way to save a small amount of money.

[zeroshiki]

As said above, this is more to know about my options and managing my money. I've not decided anything at this stage. If I'd decide to avoid paying, it would be because I'm confident that I can use this money to get a higher yield and because I'm sure I would not lose my visa.

What options? It's the law. Are you asking the members of this forum to give you tips on how to break the law?