Some good news for a change
Well, it seems like the government has given up on increasing the sales tax to 10%, so they are going ahead with unconditional changes to the pension system without tying them to the tax increase.
From August, the minimum period to vest in the Japanese state pension (kokumin nenkin and kousei nenkin) will be reduced to ten years from the current twenty-five.
This has been a long time coming. We wrote about it on the blog here almost a year ago, and most of the details are the same.
Basically, as long as you have paid in for ten years you can get a pension. To get a full pension you would have to pay in for 40, so anything less than that gets a proportion of the full pension (so ten years would get you 1/4 of the full pension amount).
I think it's quite positive that the pension agency has made this English language leaflet (the image above is taken from it) that emphasizes that you can apply for and receive the pension from abroad.
The twenty-five year minimum was, in my opinion, excessively harsh and put a lot of people off paying into the pension (which is mandatory in Japan, if currently unenforced). You could have paid in for 24.5 years and then not received a single yen back.
This change will hopefully change that and help the system be more robust (more people paying in is a good thing).
So good news for now. This may even change my own thinking on retirement, as I had been aiming to make sure my twenty-five years was paid before leaving work or moving out of Japan. Under the new system I have already vested (I've paid in for exactly 17 years).
How about you? Where do you stand vis a vis the Japanese state pension?