Could you survive on retire pension of US$77 a month?

[ASEAN NOW News]

Expats living in SE Asia are naturally concerned that our pensions may not always cover all our expenses.

 

With rising costs for food, electricity, and fuel it is getting a lot harder to make ends meet.

 

Well it seems we are not alone.

 

Recently it was reported in the local media that retirees in Vietnam say their monthly pensions are far below living costs and they are having to continue working to make ends meet.

 

Nguyen Thi Lan and her husband Tran Minh Chau are both 65. They live in Ho Chi Minh City's Tan Phu District.

 

In 2012, Lan retired after 26 years of paying social insurance. The next year, Chau retired after 20 years of paying social insurance.

 

Nguyen Thi Lan and her husband Tran Minh Chau at their house in Ho Chi Minh City's Tan Phu District, June 2022. Photo by VnExpress/An Phuong

 

As per existing law, contracted laborers must pay social insurance for 20 years to get a pension when they retire.

 

Before 2021, the retirement age was regulated at 55 for women and 60 for men. Starting last year, Vietnam has gradually increased the retirement age until it reaches 60 years for women by 2035 and 62 for men by 2028.

 

With Lan fulfilling all required conditions, she is eligible for the highest retirement pension level, which is 75 percent of the monthly salary that had been used to calculate her social insurance premiums when she was working.

 

Just US$77 

 

Today, she gets a pension of VND1.8 million ($77.2) each month.

 

Lan said back when she was still a worker at the Hung Hau Agricultural JSC, it "was not easy" for her and other workers to know the salary level on which the social insurance premium was based.

 

"When receiving the decision on my retirement pension, I was shocked at how low it was," Lan said.

 

Her husband’s pension is even lower.

 

Though Chau had worked for 20 years, he retired at 56, four years sooner than regulated.

 

Because of that, he was offered a pension level of just 55 percent of his salary base – or VND1.3 million per month.

 

Through several adjustments in which the government decided to raise the retirement pension, Lan now receives VND2.8 million and the pension for Chau is VND2.1 million.

 

In Vietnam, those living in urban areas and earning less than VND2 million per month are considered poor.

 

Average amount for expats

 

Checking online they state that a minimum amount for a comfortable retirement in a number of beautiful, safe, and appealing places across SE Asia could be US$1,200 a month.

 

That would be for most too little as I think you need at least US$2,000 to pay for rent, food and rising fuel if you own a car.

 

In some rural places, you could live on less, and, anywhere in the world, you certainly could spend more if you wanted to.

 

But US$1,200 a month is a good benchmark.

 

It seems expat pensions are a lot more generous so maybe we should be thankful that we don’t need to scrape by on a Vietnamese pension.

 

Join our 3 x a week Vietnam News, Travel and Expat information newsletter and keep up to date. https://aseannow.com/newsletter.php