Pensions are an important retirement fund that supports our lives as we grow older. However, for foreigners who do not know if they will be in Japan in the future, this system seems unreasonable. In this article, I will explain from what the pension is to whether the money you will pay is reimbursable or not.
What is Pension like in Japan?
In Japan, it is called the universal pension, and people aged 20 to under 60who live in Japan are obliged to join the public pension system.
Nationality does not matter, so foreigners working in Japan and international students who are also 20 years old or older aren’t any exceptions. However, there is a special student payment system, in which students aged 20 and over who earned 1.18 million yen or lessin the previous year are exempted from paying their pension. If this case applies to you, you can apply.
On top of the “national pension”, office workers and civil servants also join the “welfare pension“.
How’s Welfare Pension different from National Pension?
The welfare pension is insurance that office workers and civil servants who work for general companies usually pay in addition to the national pension.
The amount of insurance premiums is to be borne by 18.3%of their monthly salary (standard monthly salary), half of which is borne by the company.
The welfare pension payment period is from the day you get a job at a company to the day you retire.
From What Age Should We Pay for Pension?
The payment period for the national pension starts from the age of 20 and ends at the age of 60. Moreover, to receive the full amount, you must continue to pay without interruption during the payment period from 20 to 60 years old.
Before the end of July 2017, you could not receive the national pension without a payment period of 25 years.
However, due to the system change, after August 2017, you can receive the pension if you have a payment period of “10 years”.
How Much and How to Pay for Pension
As of 2021, the monthly fee is 16,610 yenand it will certainly increase considering Japan’s extreme aging society.
The basic payment method is “monthly payment by cash” unless you do not make a special application. The payment can be made at a financial institution window or convenience store using the payment slip “Receipt (Payment Acceptance) Notification” sent to you in April every year.
Can foreigners get the money back?
Most foreigners will return home before they reach the age of receiving a pension.
Will the money I paid come back?
Yes.
If a foreigner enrolled in the national pension or the welfare pension returns to his/her home country before receiving the pension, the person can receive a lump-sum pension withdrawal payment upon request within two years from the date of returning to his/her home country (the day when he/she no longer has an address in Japan).
To do so, you will be required to meet the following conditions and submit the required documents to the Japan Pension Service.
- Being not a recipient of the disability benefit of the defined contribution pension plan
- The total contribution period is 1 month or more and 3 years or less, or the asset amount is 250,000 yen or less.
- Two years have not passed since the date of becoming a continuous individual pension investment manager
- Not receiving a lump-sum withdrawal payment when disqualifying from a corporate defined contribution pension plan
Pension in Japan
Pensions are obligatory for all people living in Japan. It may not be a very happy system for foreigners, but you can get the money you paid back. Get the knowledge you need and treat your pension correctly.
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