Thinking about early retirement - some basic questions

[Hedgehog]

This is a request to the experts here for some advice with a bit of life planning. (I am early 50s; JP spouse; PR.)

If I were to stop working in, say, 3-5 years' time and take early retirement here in Japan what are the ongoing/regular payments (other than accommodation costs) which I would face? And would those costs/payments change in any fundamental way once I a) passed 60; and b) started receiving my JP pension?

My current employer takes care of my annual tax return, so I would need to start doing that (or pay someone to), I assume, and as I understand it my income tax + city tax would then be based on my income from my investments (JP and non-JP). How does one go about paying into the pension fund and other national health insurance contributions? At the local ward office/tax office? Are there any other costs I've overlooked? I realise these are very basic questions, but retiring in Japan rather than elsewhere has only recently started to become a distinct possibility, and so I have never really looked into what it would mean in practical terms.

If this has been covered elsewhere in the forums, I'd appreciate it if someone could show me where. Many thanks in advance.

[RetireJapan]

It's a great question and would make a good blog post/video. I will try to put something together. In the meantime, any replies here would be appreciated

[donpaulo]

Some answers are obvious but probably worth mentioning

Once we reach age 60 we do not have to contribute to the pension system.
The current law says that we can begin to receive pension payments at age 65, but the government has openly called for moving that to age 70. So you need to factor that into your calculations.

So my understanding of the situation is that you would be "on the hook" for your pension payments until you reached age 60.

We pay our various expenses through a dedicated bank account. Every month its deposit X, transfer Y.

We did have to visit our local pension office and there was some negotiation. In fact we ended up talking with about 3 or 4 different people before we got someone who was willing to make a decision on the situation. So be aware that the answers you seek may be somewhat up to the conditions and situation in the office. We were lucky to find someone professional with the authority to take action.

For clarification I am not retired nor am I thinking about it, but I have run my own shop since day 1 so have had to swim in the food chain for some time.

Your employment situation and age will affect your tax profile as well. Its important to get a qualified professional to sit down and take a look at your individual conditions. They should be able to forecast what if any changes are in store for you.

A good example would be if there is an elderly parent in the house vs living outside the house. The tax numbers are a concern there.

anyway I hope this helps a bit

[Tkydon]

See detailed discussions in these threads...

https://www.retirejapan.com/forum/viewt ... 952#p37952

https://www.retirejapan.com/forum/viewt ... 967#p37967

https://www.retirejapan.com/forum/viewt ... 994#p37994

https://www.retirejapan.com/forum/viewt ... 063#p38063

Some answers are obvious but probably worth mentioning

Once we reach age 60 we do not have to contribute to the pension system.

Contributions to Age 60 are compulsory.
You can choose to make Voluntary Contributions to get your Number of Years / Months up from 60 to 65.
See 'Voluntary Contributions' Section
https://www.nenkin.go.jp/international/ ... nsion.html

The current law says that we can begin to receive pension payments at age 65, but the government has openly called for moving that to age 70. So you need to factor that into your calculations.

You can start receiving 70% of your qualified Pension Amount at 65 from Age 60
https://www.nenkin.go.jp/service/jukyu/ ... 21-01.html

increasing to 100% of your qualified Pension Amount at Age 65

increasing to upto 184% of your qualified Pension Amount at 65, if you delay until Age 75
https://www.nenkin.go.jp/service/jukyu/ ... 21-02.html

So my understanding of the situation is that you would be "on the hook" for your pension payments until you reached age 60.

Yes, Basic Pension Contributions, currently Y16,920 per month.