You contribute so much, you receive so much. It is the maximum in a pension system governed by a Social Security in which we all contribute. Unlike the salaried employee, the autonomous has the ability to choose the base for which he quotes. A right that brings out a figure, the less descriptive: 86% of the self-employed do it for the minimum base. It is a fact included in the report ‘The self-employed person in the face of social security’ carried out by the National Federation of Associations of Autonomous Workers (ATA).
All pensions – those of employees and the self-employed – are based on the contribution bases and the time during which they have been paid. If the pensions of practically 9 out of 10 freelancers are governed by the minimum, we can deduce that their pension will be much different from the income received in assets. However, behind this overwhelming majority there is no mischief, but survival, because the self-employed who pay less, charge less and enjoy less coverage.
From when there is a pension
To be entitled to collect a pension, the self-employed worker must have contributed at least 15 years, two of them must be included in the last 15 years prior to the date of retirement. It is the minimum required. That said, how much will a freelancer who quotes for the minimum base charge? After the 2019 reform, the minimum base is 944.40 euros and the maximum is 4,070.10 euros. In both cases, what is quoted is 30% of the base chosen.
The same report from the ATA shows another relevant fact: practically one in three self-employed, 28.7%, would choose to raise the contribution base to Social Security if they improve the benefits to which they are entitled. In general, according to the report “The self-employed person in the face of social security,” 37.9% of the group of self-employed workers are predisposed to change and increase their contribution base.
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However, why do they contribute for the minimum by putting the public pension in check that they will receive when the time of retirement comes? The same report shows that 38.2% of the self-employed point out the lack of income as the main reason for not raising their contribution base. On the other hand, 13.2% prefer to invest the money in contracting private plans because they consider that they are better than the benefits they will receive from the public system.
True or not, it is a particularly relevant figure if we consider that one in two freelancers believes they do not have sufficient knowledge of the benefits They generate their Social Security contributions, while one in three freelancers consider that they know the basics. On the contrary, only 3% of the self-employed think that they have a broad knowledge of the benefits to which they are entitled to be autonomous and contribute to Social Security.
The 2019 reform increased the contribution base by 1.25% and the monthly fee by 5 euros
The truth is that the reform of 2019, in addition to an increase in the contribution base of 1.25% and the increase in 5 euros of the share monthly, brought with it some measures that translate into new coverage. Some of the most prominent are the increase of 12 to 24 months of the call ‘self-employed unemployment’, The inclusion of this group in the Vocational Training System for Employment or access to a flat rate after maternity leave, among others.
Lampistas, designers, journalists, accountants, lawyers, architects, transporters … An overwhelming majority still contribute the minimum although that same base is transferred to what will be left of public compensation for retirement. If quoting in that range does not guarantee a pension aligned with your needs, why in Spain more than 90% of the self-employed under the age of 47 contribute for the minimum? Perhaps for the same reason that explains that there are up to 124,675 freelancers over 65 years of age active. Survival instinct.