Just an observation on the declining kokumin nenkin

[Neil]

I noticed the kokumin nenkin payments have gone down from ¥786,500 to ¥779,300 in exactly 36 months. That's a drop of ¥7,200 pa, ¥600 pm and a 0.91% decrease, I believe. Inflation is about 0.7% according to the latest figures. For 10 marks, where's that going to leave us in 15, 25, 35 years?

[RetireJapan]

I'm counting on 0 from the national pension, but expect we'll get about 70% of what it is now (assuming Japan doesn't switch to some kind of universal income system). Say 50,000 yen a month in today's yens?

[Neil]

Why don't the government put a massive tax on tobacco to expand their coffers like the other 1st world countries!? They're a third of the price of cigs in the UK. Rhetorical question, of course. We know why.

[Jamo]

So the premiums are going up but the payout is going down. Seems like standard Japanese Government economic (mis) management. There's a few ways they could fix it. One would be putting all the money sitting in the dormant bank accounts of deceased into it. Or decreasing the payouts of wealthier old people.

I finally signed up for it the other day (after nearly 4 years in Japan) as I am considering utilizing iDeco. I'm yet to make a payment on my nearly three years of back-payments, and I still haven't made my mind up if I should or not.

My wife thinks it's a good idea because of the insurance that comes with it, but we are yet to have kids (so that discounts the survivor's pension) and the widow's pension can only be received between the ages of 60 and 65. The only one that kind of looks decent is the disability insurance.

I guess the question for me is, is paying 16,000 a month to access iDeco worth it? Because receiving 50,000? a month after 30+ years of paying 16,000+ a month seems like a shite deal...

[RetireJapan]

So the premiums are going up but the payout is going down. Seems like standard Japanese Government economic (mis) management. There's a few ways they could fix it. One would be putting all the money sitting in the dormant bank accounts of deceased into it. Or decreasing the payouts of wealthier old people.

I finally signed up for it the other day (after nearly 4 years in Japan) as I am considering utilizing iDeco. I'm yet to make a payment on my nearly three years of back-payments, and I still haven't made my mind up if I should or not.

My wife thinks it's a good idea because of the insurance that comes with it, but we are yet to have kids (so that discounts the survivor's pension) and the widow's pension can only be received between the ages of 60 and 65. The only one that kind of looks decent is the disability insurance.

I guess the question for me is, is paying 16,000 a month to access iDeco worth it? Because receiving 50,000? a month after 30+ years of paying 16,000+ a month seems like a shite deal...

The starting point for this is that it is a legal requirement for all residents of Japan to pay into the public pension and health insurance schemes. Loosely enforced at present, but it will probably get stricter as time goes on. They are starting to farm collection out to private companies.

Depending on your tax bracket, your tax savings for iDeCo could end up paying your pension contributions. Might be worth playing with the calculator here: http://dc-center.jp/checker/

[Jamo]

Thanks for the info!

[captainspoke]

...
Or decreasing the payouts of wealthier old people.
...

I would disagree with means testing.

People who spend it all, or most of it, or who job hop & move, travel, or who have affairs and get divorces, who are perhaps buying bitcoin right now, or who maybe sent their kids abroad to an expen$ive uni, do not deserve to be subsidized by others.

And at a little over ¥60k/month, they're not going to be able to live on it anyway. Nor is that amount going to bankrupt the gov't.

[RetireJapan]

I also disagree. The pension in Japan is not welfare, it is something people paid for. People who didn't pay don't get a pension (they may be able to get welfare if they are in financial difficulties) so I think it kind of breaks the 'contract' to retroactively means test it.

Health insurance is a different matter perhaps.

[Neil]

... so I think it kind of breaks the 'contract' to retroactively means test it.

A 'contract' under which the final payout decreases each year that we don't retire...

[RetireJapan]

... so I think it kind of breaks the 'contract' to retroactively means test it.

A 'contract' under which the final payout decreases each year that we don't retire...

That is a brutally accurate observation there...