The retirement age and 100% of the pension are two different terms, although they are linked to each other. Although the contributions, which are the years and months that we have contributed, serve largely for this, Social Security regulations explain that they are two different parameters because, on the one hand, one determines at what age a person can retire without penalties, the other serves to determine how many years are necessary to collect 100% of the pension or regulatory base.
Thus, explains lawyer Miriam Ruiz Acosta, from Compromiso Legal (@compromisolegal on TikTok), “it is false that because you have been contributing for 38 and a half years you are already entitled to 100% of the pension.” This is so, since if we look at the Law 27/2011 (as consulted in this BOE), this period is used to determine when you will be able to retire without reducing coefficients, but not to calculate the final amount.
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Social Security will lower the retirement pension for workers whose regulatory base, after applying coefficients, is higher than the maximum amount
This law establishes that, in 2027, the ordinary retirement age will be 65 years for those who have at least 38 years and 6 months of contributions, and 67 years for those who do not reach that threshold. In 2025 and 2026 these limits are still in transition and it will be necessary to be 38 years and 3 months to retire at 65 and, if they are not met, the ordinary age is 66 years and 8 months (2025) and 66 years and 10 months (2026).
Now, and as the lawyer explains, in this case the contributions serve to determine at what age we can retire without penalty.
“38 years old is not useful for calculating your pension”
Ruiz Acosta explains that this confusion happens to many people, since “the figure of 38 and a half years is used only to know if you are retiring ordinarily or early and, in the latter case, to apply penalties to you.”
To calculate the amount of the pension, what is taken into account is the average of the contributions of the last 25 years (the last 300 months), what the law calls the regulatory base or, to understand it better, 100% of the pension to which you are entitled. To collect 100% of this regulatory base it is necessary to have contributed for 36 and a half years in 2025 and 2026, or 37 years from 2027.
Two real cases that show how the system works
To understand it better, the lawyer shows two examples to dispel the myth that if you exceed 38 and a half years of contributions to receive 100 percent. In the first example, a person retires at 63 years old and has 40 years of contributions. On paper, it exceeds the 36 and a half years necessary to reach 100 percent of its regulatory base. Now, since you retire before the age of 65, Social Security applies a reduction coefficient of 19% (see the Penalty for early retirement based on years of contributions). The result is that this person will only collect 81 percent of his pension, despite having more than 38 years of contributions.
The second case is the opposite. A person who retires in 2026 at 66 years and 10 months and 36 and a half years of contributions does receive 100%. Because? Because for this year, those who do not reach 38 years of contributions can retire at 66 and a half without cuts. Since this person reaches that ordinary age and is also old enough to reach 100 percent of his regulatory base, he does not suffer penalties.
In this way, it must be clear that having more or less than 38 years of contributions does not determine the percentage of pension that is collected, it only indicates when you can access retirement without suffering cuts.
Differentiate “when I will retire” from “how much I will earn”
Ruiz Acosta insists that many workers reach retirement with wrong ideas because both issues are constantly confused. “One thing is when you can retire and another thing is how much of your pension is left,” says the lawyer, who recalls that there are numerous cases of people who, despite having contributed for 40 years or more, have seen reduced pension for retiring before 65.
Finally, he explains that “the pension system is complex and it is advisable to get good advice. If you have been penalized despite having been contributing for more than 38 years or know someone in this situation, review the case with a professional.”