Despite financial difficulties, do not cancel your private pension plan

In the private retirement provision in principle, it is about long-term wealth accumulation. You can opt for several strategies from insurance through stocks or shares Funds until property decide. Usually you pay more or less high monthly amounts or installments. This can be difficult in financially stressed times.

Do not cancel your private pension plan

If you can no longer meet your obligations from loan installments, insurance contributions or fund savings for certain reasons, you will have to cut expenses or stop payments. Completely dissolving private old-age provision would be the worst possible solution.

• The elimination of monthly payments for a living or pension insurance gives you some financial leeway. Get in touch with the companies concerned or Banks and apply for the contract to be converted to an exemption from contributions. In the case of savings plans, they inform you about a stop in the savings installments; revoking the direct debit is often enough.
• If you urgently need extra money, consider canceling and paying out the savings credit. That needs to be carefully considered for the individual system variant.
• A private pension or Life insurance you can cancel, but you will not make a profit. In the first few years, the savings balance hardly grows, and commissions also consume any surrender value. If you cancel after a term of 15 years or more, the surrender value is still too low.


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• If you want to take out a policy again later, new commissions will be incurred. You have to pay tax on the surrender value. If it is only a few years until you retire, you do not need to cancel. You will very much appreciate the advantages of your own retirement provision.
• If you are financing a property used for retirement provision, the installment payment cannot simply be turned off. You can certainly terminate the loan agreement. But then the remaining amount is due immediately. You can agree to a deferred payment or a repayment suspension with the lender.

Receiving social benefits - using up assets

Under certain conditions, you may be forced to cancel your private pension plan.

• Suppose you have to suffer from financial difficulties due to a prolonged illness social benefits of the state. At the same time, you are in possession of a private pension insurance. If this is too high and is above the statutory allowances, you can be denied state benefits.
• According to current case law, you would have to use the insurance utilize. This means that by reselling or selling the policy prematurely, you obtain your own financial resources, which you have to use up accordingly.
• When drawing social benefits, you are entitled to a certain basic asset allowance. In addition, there is an exemption for old-age provision of 750 euros per year of life.
• The law makes exceptions for state-sponsored Riester or Rürup pensions. These are excluded from crediting.
• For an exemption from credit is required. The utilization of the pension capital before retirement is irrevocably excluded by contract. Termination, repurchase or lending would not be permitted. The recovery is after the 60. Year of age allowed.
• Company pensions are still not offset if they are fully financed by the employer. Access before the occurrence of the supply case must be excluded.

You do not have to dispose of a condominium or a house of normal value that you live in, despite receiving social benefits. State benefits may be borne by the future heirs. The state makes payments with reservations and demands them back later.