Pension situaion for Self-employed-ish plus spouse?

[RetroNewbie]

Given that pensions payments have been in the news recently it has reminded me to get back to looking into my pension situation. The more I've looked into it the more it appears I'm kinda screwed. Some of the articles I found even referenced RetireJapan, so I thought I'd come and ask for opinions/suggestions.

My situation: I'm working 95% for one company, but the way the contract is structured I'm effectively a contractor ie: self-employed. I don't get any company pension from them. Wife is not working.

I've been paying 17k a month for my wife's pension for the last 5-10 years (and if we miss a month we get immediate threatening letters about it). However I've never had or been asked to have a pension for myself in Japan. I was under the impression that I didn't need one as I've continued paying into my UK state pension. But i've been informed that's not correct.

Based on a few articles I've read (eg: https://blog.gaijinpot.com/guide-pensio ... nts-japan/ ), it seems that self-employed people are kinda screwed.

As I understand it:
- I'm currently paying 17k a month for one basic pension, which might pay out 66k a month.
- I maybe should be paying 34k a month for 2 basic pensions that might pay out 132k a month.
- If I was a company employee, a rough back-of-the-envelope calculation implies I might be paying 25k a month for an employee + free basic pension that might pay out 232k a month. (not including the company's contribution).

(NB: my current salary varies a lot per month, so it's a bit of an average/guess. These are based on 40 years of payments, which I'll be nowhere near. Not including the UK pension. )

So, short of getting a full time employee job, the situation doesn't look great.

I can't really afford to commit to paying another 17k every month for my basic pension.. especially if the demand gets back dated 2 years.
I was thinking of going for something like a Nisa/iDeco where I could pay in around 5k a month and it'd be more flexible... but I heard that might attract the attention of the pension people?

Hypothetically, If the wife got a low paid but permanent job with an employee pension, would that then make my basic pension free?
In the figures above... if paying 25k a month for the employee pension, I assume you don't also have to pay the 16k a month for the basic one?
Given that a huge number of japanese people seem to be on temporary contracts these days, I assume they're also on the basic pension and aren't going to get much money when they retire?

Anyone have any thoughts or recommendations about the best way to deal with pensions?

[RetireJapan]

A few really quick thoughts:

1. You have to pay into kokumin nenkin. Best to go in and talk to them before they find you. They might agree to let you pay the two years in arrears you probably owe in installments.

2. If your wife is not working she may be able to apply for an exemption to paying kokumin nenkin. If she is successful, she would still accumulate pension credits at half the rate she would if she were paying.

3. If you want to use iDeCo (and it can be a great deal), you need to be currently paying nenkin.

4. You might want to look into fuka nenkin (https://www.retirejapan.com/blog/guest- ... ka-nenkin/)

5. Being on shakai hoken would probably be a better deal for your family from what you wrote. It might be worth trying to find a job that will enrol you.

6. You would only have your pension and health insurance paid by your wife's shakai hoken if your income was low enough to be classed as her dependent (under 1.2 m yen a year or so)

Anyone else?

[coffeespoon]

Hi!

Maybe you can go and talk to the nenkin people at the cityhall? A few years ago, my job situation changed and I couldn't afford to pay the kokumin nenkin (AND health tax AND city tax). They actually gave me an exemption. This means that I will get less in the future (I think I can pay the amount that I was exempt in the future), but at the time, that was necessary for me!

Good luck!

[Sybil]

I can't really afford to commit to paying another 17k every month for my basic pension.. especially if the demand gets back dated 2 years.
I was thinking of going for something like a Nisa/iDeco where I could pay in around 5k a month and it'd be more flexible... but I heard that might attract the attention of the pension people?

As mentioned it is not possible to utilize an iDeCo unless you pay into national pension scheme. Anyway, your stated target of paying 5,000 yen isn't enough. You should be aiming to pay the 17,000 yen for the national pension AND contribute 68,000 in an iDeCo.


There is usually a way of getting additional money. Moving to a cheaper apartment, cutting expenses, getting an additional part-time, getting the wife to contribute to the finances etc...

[0x143]

Cellphone plans are a big/easy place to pull in an extra 万 of cashflow. So many families are stuck with Softbank or its ilk.

[ricardo]

I pay loads of money to au every month.

I gets lots of free stuff every week, good service, the latest handset (in my case an iPhone XS Max - space grey), a very high speed 4G connection, pay-as-you-go data.

Cheap things are cheap for a reason.

[RetireJapan]

I pay loads of money to au every month.

I gets lots of free stuff every week, good service, the latest handset (in my case an iPhone XS Max - space grey), a very high speed 4G connection, pay-as-you-go data.

Cheap things are cheap for a reason.

But for many people switching to a low-cost carrier can save substantial amounts of money without any real sacrifice in service. My bill with AEON is about 1,000 yen, and I used to pay 8,000-9,000 a month to Softbank. No noticeable difference on my end.

The big expenses: housing, transport, food, communications, entertainment are where most people are going to find fat to trim.

And of course if you don't need to trim the fat there is no need to worry about this

[0x143]

The big expenses: housing, transport, food, communications, entertainment are where most people are going to find fat to trim.

I agree 100%. So often when people think of savings they first think of food. Yet saving money on food requires making multiple decisions and actions everyday. Instead the first priority should be expenses which save money every day from a one time decision.

Phones are big. Cutting silly subscriptions. Switching from 電波放送&NHK to Netflix. Booking your own tickets and hotel without a travel agency. Anything big or anything charged monthly will be the easiest waste to trim.

[ricardo]

Yep, agree with most of the above.

I queue up at my local supermarket before doors open to get ¥9 carrots and I book all my holidays independently - only when there’s a sale on (never use an agent). Going to Thailand (Bangkok and Pattaya) for New Year for ¥200k, six nights in posh hotels and flights.

I pay on nothing for TV other than the NHK fee.

I buy cheap clothes from GU and and I don’t care about my appearance.

And I throw money at au every month without having to worry. I always have the latest handset in my hands.

Choices....

[Sybil]

So often when people think of savings they first think of food. Yet saving money on food requires making multiple decisions and actions everyday. Instead the first priority should be expenses which save money every day from a one time decision.

Yes. Also he has indicated that he is married to a stay-at-home wife so presumably she has time to cook meals (including bentous) so he shouldn't be reliant on eating out all the time.