A pension is someone who is no longer working because of his advanced age and must be dismissed, or at his own request (young retirement). A person who retires usually gets the right to a pension fund or severance pay. While the benefits of pension are periodic payments given to participants at the time and it’s within the specified requirements in the retirement solutions and Fund regulations.
After getting a quick overview of pensions and pension benefits, now you can get to know some of the types of pensions you need to know. In fact, retirement is not only done at a certain age, but there are other conditions that can change when you retire.
Well, if you want to find out more, let’s look at these two types of pension types that you need to know:
Normal pension is a pension given to employees whose age has reached the retirement determined by the company. Participants who retire at the normal retirement age or after, are entitled to pension benefits calculated based on the pension formula that applies to their participation until retirement.
The normal retirement age is stipulated in the Pension Fund regulations and may not exceed the age set by the Ministry of Manpower.
In some countries, the normal retirement age is usually 55 years.
However, there are also those who give pensions after a certain period of service, even though they have not yet reached the normal retirement age. For example, giving employees retirement rights after reaching a certain service period such as 30 years of working age.
Accelerated retirement is a type of pension provided due to certain conditions, for example, there is a reduction in employees in the company.
Accelerated pension benefits are pension benefits for participants that are paid out if participants retire at a certain age before the normal retirement age.
This type of pension allows employees to retire early before reaching their normal retirement age. Usually, there must be a clear reason to submit an application to the employer so that his retirement can be accelerated.
Pension Fund Regulations reveal that employees are allowed to retire earlier than their normal retirement age with special terms and conditions after reaching a certain age, for example, 50 years.
In addition, it will also be seen meeting the minimum service period or if there are certain conditions that require employees to stop working.
For example, accelerated retirement can occur in the following conditions:
The age of the employee has reached 50 years.
Employees have worked with a service period of more than 30 years,
Associated employees have permanent disabilities.