Retiring early from the local police force

If you are a local police officer, you can consider retiring before you are 65 thanks to the latest social security reforms

The Ministry of Employment and Social Security recently supported a Royal Decree to reduce the minimum retirement age for people who work in an environment that is "difficult, toxic, dangerous or unhealthy and involves high levels of morbidity or mortality". This decision, which invokes Article 206 of the General Social Security System, makes it possible for local police to retire early.

In essence, this mechanism to allow local police to retire early uses a ratio to reduce the retirement age. This reduction applies to all members of law enforcement agencies that serve local authorities who have 15 years of service or more.

This article gives you some details about this reform. If you are part of a local police force, you'll find out how to take early retirement without damaging the purchasing power of your pension at any time.

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The criteria of the reform

Under normal circumstances, you must be at least 65 in order to access a retirement pension. As stipulated in Article 205 of the Social Security Law, in 2018 people aged 65 years and 6 months (67 from 2027) who have paid social security contributions for at least 15 years, or 65 if they have paid social security contributions for at least 36 years and 6 months (38 years and 6 months from 2027) are entitled to receive a retirement pension. Nonetheless, under extraordinary circumstances people whose temporary disability has a protracted economic effect on them are also entitled to receive a retirement pension. However, did you know that certain groups can access their pension early?

The following article of the above law, Article 206, states that it is possible to reduce the minimum age at which a person can access their retirement pension by Royal Decree if the activity they perform is of a certain type or if they have become disabled. This assessment is analyzed in studies that explain the accident rates of different industries in detail, as well as how difficult, dangerous and toxic work conditions are. As a result of the above and in order to absorb the impact of working life, ratios to reduce the age of retirement have been established to enable people to access their pensions earlier.

The reform, the law and its impact on local police forces

By law, the number of years of social security contributions paid by certain groups (including local police) is subject to a reduction of 0.20%. This means that members of these groups can retire up to a maximum of 6 years early, provided they have paid contributions for 37 years. The qualifying period in order to apply the above ratio is 15 years.

The number of years a person has paid contributions is calculated in the same way as for other groups. This means that absences due to disability, illness (irrespective of cause), maternity or paternity leave, or for other types of paid leave are deducted. Accordingly, members of the police force who meet the requirements provided for in the General Social Security System can take advantage of this early retirement scheme for local law enforcement agencies.

There are approximately 70,000 local police officers in Spain. This decision, which is the result of many years of work, helps alleviate work pressures for a lot of them. According to the "Report on assigning ratios to reduce the age of retirement for members of local police forces" (May 2016), drawn up by the Ministry for Employment and Social Security, the average age of local police officers is 43.7 years and the average length of service in the force is 23 years. However, although the force is young overall, it still has high work-related accident and illness rates. Therefore, it seems more than justified that this group be considered for early retirement.

Furthermore, because of the 0.20% reduction permitted by the new law, any years not worked will still be taken into account as regards social security contributions and years spent in employment in order to calculate what an employee's assessment base is.

This arrangement to speed up the retirement process also aids the rotation of personnel within the police force. Thus, people who have been working in the force for some years (at least 15 years) can gain respite and new employees will be given the opportunity to join the force. Therefore, this is a necessary and useful reform, as it makes an important job more attractive, which is of benefit to everyone.

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The options offered by BBVA to improve police pensions

People who opt to retire early from the police force will leave before they are 65. In many cases, this means that they may still have certain responsibilities and obligations. When they first retire, they may still have to be able to cover mortgage and debt repayments, as well as other expenses such as the cost of sending their children to college or university, home renovations, etc. If any of these situations apply, the reduced purchasing power resulting from collecting a pension can cause a financial imbalance, which can be successfully resolved with the correct planning. But how? A pension plan can be a good option to help you deal with early retirement.

By making modest contributions to a pension plan on an ongoing basis, you can obtain surprising long-term results. This saving will help you make the most of any current surplus funds you have in the future and earn some money by making a meaningful investment. Given that you can deduct up to a maximum of €8,000 per year in income tax from pension plan contributions (plus a further €2,500 if your spouse does not have a high level of income), saving in this way will also reduce the amount of tax you pay. In other words, this type of investment may even help you obtain a tax refund.

Go to bbva.es to take a look at these types of plans. Start to work out your finances now for early retirement if you are a local police officer and don't let any unforeseen events spoil your well-earned retirement.

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