How is the pension calculated?

Basic pension = (when the insured retires, the average monthly salary of the local employees in the previous year+the average monthly salary indexed by himself) ÷2× individual cumulative payment period× L%

My indexed monthly average payment salary = the average monthly salary of employees in the whole province last year when the insured retires × my average payment salary index.

My average wage index = (a1/a1+a2/a2+...+an/an) ÷ n

In the formula, a 1, A2...an is the salary paid by the insured within 1 year, 2 years ... n years before retirement;

A 1, A2... 1 year, 2 years' average salary of employees in the whole province ... n years before the insured retires;

N is the number of years that enterprises and employees actually pay the basic old-age insurance premium.

Extended data:

Through the way of pension financing

In practice, the ways of raising pensions formulated by enterprises can be divided into two ways: funded retirement and unfunded retirement.

1, retirement measures for deposit funds

Enterprises withdraw retirement funds and hand them over to independent trust institutions, such as banks or insurance companies for safekeeping and use. When employees retire, the trust pays the pension from the retirement fund. If an enterprise fails to fully fulfill its obligation to pay pensions, it may not withdraw pension funds.

2. Retirement measures for non-deposit funds

If the enterprise fails to withdraw the pension fund and deliver it to the trust institution for safekeeping and use, or if the enterprise withdraws the pension fund but delivers it to the trust institution for safekeeping and use, when the employee retires, the enterprise will raise funds by itself to pay the pension. Compared with the retirement method of deposit fund, this method lacks the protection of employees' pension.

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