Retirement
Earnings points are the unit used to calculate the state pension: one point equals one year of contributions at the average income level.
Earnings points (Entgeltpunkte) are the central unit for calculating the statutory pension. They record how much a person has earned and contributed relative to the average of all insured members.
Someone who earns exactly the average income in a year and pays contributions on it receives one earnings point. Earning above or below the average leads to correspondingly more or fewer than one point.
The earnings points accumulated over a working life determine the eventual size of the pension. The precise pension amount results from the interplay of several factors and can only be established in the individual case.
Related terms
Read next
See taxes, dividends and allocation for your whole portfolio in one place.