Mutualists with 38 years of contributions will be able to receive a 1,200-euro pension
Professionals who contribute to alternative mutual funds will be able to double or triple their retirement pension if they meet the 38 years required by Social Security to access the maximum pension.
The Congress has approved a law that opens a pathway for these mutualists to migrate to the self-employed regime, with a benefit that could exceed 1,200 euros per month, compared to the 300 to 700 euros they currently receive.
The keys to the new law for mutualists
What changes for professionals who contribute to mutual funds
The new regulation opens the door for professionals such as lawyers, doctors, engineers, or architects to transfer their contributions accumulated in alternative mutual funds to the special regime for self-employed workers (RETA) of Social Security.
This means they will be able to convert their accumulated funds in years contributed to Social Security, with the promise of a much higher pension — in some cases almost triple — compared to what they previously received.
The importance of 38 years contributed
One of the key points is that a minimum of 38 years must have been contributed — the same requirement as the general regime for the maximum pension — to opt for this improvement.
A socialist deputy gave a clear example: a mutualist with a current pension of 450 euros could go on to receive 1,200 euros per month thanks to the new regulation.
The limits and controversies of the reform
The reduction coefficient and the update of funds
Despite the good news, the law does not guarantee that all mutualists will reach the minimum pension of the public system. The transferred funds will be updated, although it is unknown if it will be according to the CPI or another system.
In addition, a reduction coefficient of 0.77% will be applied to achieve more years contributed, which limits the potential increase in the pension.
Why doesn’t the 1x1 system apply?
The mutualists’ associations demanded that one year contributed to the mutual fund be counted as one year contributed to Social Security (1x1 system), thus equalizing pensions with those of the self-employed.
But since contributions to mutual funds are usually lower, equalizing pensions would be too much of a blow to public finances, which is why the law does not allow this option.
Last-minute changes and the future of mutualist retirement
Including retirees and active workers
A last-minute amendment will allow anyone who has contributed to a mutual fund to transfer to Social Security, whether they are still working or already retired.
This opens the door for many retirees with low pensions to see their benefit improved, although nuances and clarifications are expected in the Senate.
The current pensions of mutualists
Many professionals who have minimally contributed to mutual funds currently receive pensions well below the minimum wage, between 300 and 700 euros per month.
The new law therefore presents itself as an attempt to correct this situation, although with limits and conditions that for now do not resolve all inequalities.
The reality is that, after decades of contributing, many mutualists still depend on aid to survive retirement.
