The Bulgarian pension plan is set up into four pillars:
The sum of the person's age and the number of years of participation in the pension scheme must be at least 100 for men and 94 for women, to qualify for state pension. If the lengths of service requirements are not met, the retirement age is 65 for both men and women along with15 years of contributory service.
Retirement is not necessary once the common age has been reached, but many Bulgarians do retire when applicable. Early retirement is possible for those working under hazardous working environments such as teachers, military, and police.
The contribution rate for pension is 17.8% of the gross insurable income. For persons born after 1959, the contribution rate for first pillar is 12.8% and 5% are then transferred to the second pillar. The employer pays 56% of the total contribution and the remaining 44% are on behalf of employee. Contribution rate for military and police officers is 40.8% and paid by the State.
Pensions are indexed in July every year with percentage equal to 50% of the increase in the consumer price index plus 50% of the insurance income growth during the previous year.
The first pillar is administrated by the National Social Security Institute, which is responsible for the payment of pensions and social insurance benefits in the event of one's temporary incapacity to work, maternity and unemployment.
There are not many companies that offer pension plans in Bulgaria. Most companies abide to the state pension plans. However, this is a more common option among expats.
If you are working for an international company or international government, consult your contract about company plans.
The private pension plans in Bulgaria are under the category of the 2nd pillar pension plan called mandatory individual accounts. They can be a universal pension fund or a professional pension fund. Individual retirement savings account are managed by a licensed private pension company.
A few countries have a bilateral agreement with Bulgaria that allows for years worked in Hungary to count to their state pension of their home country. Be sure to inquire with your state plan about the particulars and if there is a social security agreement with Bulgaria available.
Also, it is possible for your pension to be frozen from your home country.
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