How long and how much do you have to earn for an early retirement of CZK 20,000?

How long do you have to work to reach early retirement of CZK 20,000? And what income do you have to have in order to receive an early pension of CZK 20,000 after 40 years of service? Look at the examples.

Having an early pension of CZK 20,000 is tempting, but for many pension applicants it is rather an unattainable dream. In addition, the government approved a pension reform, according to which the retirement age is linked to the life expectancy.

On the amount of retirement pension the insurance period and the personal assessment basis have an effectfor early retirement, the reduction for early retirement also plays a role, which has a value from October 2023 1.5% of the calculation base for every 90 calendar days of early payment.

Early retirement at least 3 years before retirement age

Early retirement can be taken no earlier than 3 years before reaching the regular retirement age (previously it was 5 years) and if the condition of the insurance period of 40 years is met.

In early retirement, there is also no longer the right to part of the valorization, until reaching the regular retirement age, the recipients of the early pension are entitled to an increase in the basic amount of the pension, after reaching it, the right to valorization will also increase pension percentages.

To make matters worse, on early retirees are not entitled to extraordinary valorization until they reach the regular retirement age.

So how to reach an early retirement of 20,000 CZK?

Source: Shutterstock

Insurance period of 40 years and early retirement in the amount of CZK 20,000

Mr. Pavel wishes for an early pension in the amount of CZK 20,000, what must be the personal assessment basis for an insurance period of 40 years and if it is reduced by one quarter?

Mr. Pavel’s personal assessment base must reach at least CZK 47,489 in order to reach an early pension of CZK 20,000.

What if Mr. Pavel retired even earlier?

Personal assessment base	Insurance period	Early retirement date	Monthly pension
44,933 CZK	40 years	0 days (regular pension)	20,000 CZK
47,489 CZK	40 years	90 days	20,000 CZK
50,195 CZK	40 years	180 days	20,000 CZK
CZK 53,035	40 years	270 days	20,000 CZK

Source: author’s own calculation

Insurance period of 40 years and early retirement in the amount of CZK 20,000 with child support

Mr. Pavel’s wife, Mrs. Jiřina, she raised 2 children (therefore she is entitled to child support for two children), insurance period 40 years.

In the table, we show what Mrs. Jiřina’s personal assessment basis would have to be in order to reach early retirement in the amount of CZK 20,000 with an insurance period of 40 years.

Personal assessment base	Insurance period	Early retirement date	Monthly pension
38,525 CZK	40 years	0 days (regular pension)	20,000 CZK
40,920 CZK	40 years	90 days	20,000 CZK
CZK 43,443	40 years	180 days	20,000 CZK
CZK 46,110	40 years	270 days	20,000 CZK

Source: author’s own calculation

Thanks to the monthly education fee of 2 x 500 CZK, Ms. Jiřina has a personal assessment basis that is approximately less than seven thousand crowns lower than Mr. Pavl’s.

Tip: How does the pension granted in 2022, 2023 and 2024 differ? Was it worth leaving early?

Average salary and early retirement CZK 20,000 with an insurance period of 45, 44 and 43 years

In the 4th quarter of 2023, the average gross monthly nominal wage was CZK 46,013. If we use it as the assessment basis in our examples, with an insurance period of 45 years you will be entitled to a regular old-age pension in the amount of CZK 22,139.

In the tables, look at the reduction in the assessment base in the amount of the average salary for an insurance period of 45 years, 44 years and 43 years.

What is the pension calculation for an insurance period of 45 years?

Personal assessment base	Insurance period	Early retirement date	Monthly pension
CZK 46,013	45 years	0 days (regular pension)	CZK 22,139
CZK 46,013	45 years	90 days	21,745 CZK
CZK 46,013	45 years	180 days	CZK 21,351
CZK 46,013	45 years	270 days	20,957 CZK
CZK 46,013	45 years	360 days	20,563 CZK
CZK 46,013	45 years	450 days	20,168 CZK
CZK 46,013	45 years	540 days	19,774 CZK

Source: author’s own calculation

How does the calculation change if the insurance period is 44 years?

Personal assessment base	Insurance period	Early retirement date	Monthly pension
CZK 46,013	44 years old	0 days (regular pension)	21,745 CZK
CZK 46,013	44 years old	90 days	CZK 21,351
CZK 46,013	44 years old	180 days	20,957 CZK
CZK 46,013	44 years old	270 days	20,563 CZK
CZK 46,013	44 years old	360 days	20,169 CZK
CZK 46,013	44 years old	450 days	19,774 CZK

Source: author’s own calculation

How does the calculation change if you have an insurance period of “only” 43 years?

Personal assessment base	Insurance period	Early retirement date	Monthly pension
CZK 46,013	43 years old	0 days (regular pension)	CZK 21,351
CZK 46,013	43 years old	90 days	20,957 CZK
CZK 46,013	43 years old	180 days	20,563 CZK
CZK 46,013	43 years old	270 days	20,169 CZK
CZK 46,013	43 years old	360 days	19,774 CZK

Source: author’s own calculation

With an insurance period of 40 years and a personal assessment basis in the amount of an average salary of CZK 46,013, your early retirement will not exceed the amount of CZK 20,000, if you are not entitled to educational allowance.

You can calculate the amount of your potential old-age pension, including reductions, in our calculator:

Insurance period 45 years and early retirement CZK 20,000

In the table, we show what personal assessment basis you must have in order to reach both a regular and an early retirement pension of CZK 20,000, depending on the deduction for early retirement. It is thus illustrative to see how much higher discretionary income those interested in early retirement must have in order to have the same high pension.

Personal assessment base	Insurance period	Early retirement date	Monthly pension
33,825 CZK	45 years	0 days (regular pension)	20,000 CZK
35,840 CZK	45 years	90 days	20,000 CZK
37,950 CZK	45 years	180 days	20,000 CZK
CZK 40,170	45 years	270 days	20,000 CZK
44,930 CZK	44 years old	360 days	20,000 CZK
50,190 CZK	44 years old	540 days	20,000 CZK
59,215 CZK	43 years old	720 days	20,000 CZK
CZK 66,140	43 years old	900 days	20,000 CZK
78,260 CZK	42 years old	1080 days	20,000 CZK