Retiring before the ordinary age and maintaining a high pension will be possible in 2027, although workers who are thinking about bringing forward their retirement should pay special attention to the changes that will come into effect on January 1st. The Social Security will continue applying the schedule of reduction coefficients approved in the pension reform of 2021, which includes progressive penalties for those who access voluntary early retirement with a theoretical pension higher than the maximum established by the system. Furthermore, 2027 will mark the end of the gradual increase period of the retirement age, which will be generally set at 67 years, although those who prove sufficient contributions will be able to continue retiring at 65.
The changes particularly affect workers who have contributed for decades on high bases and whose calculated pension could exceed the maximum allowed limit. In these cases, the Social Security applies a transitional regime of reduction coefficients that progressively increase until 2033, depending on the months of advancement and the contribution period. However, having a high contribution base does not automatically guarantee receiving the maximum pension, so it is essential to check the estimated amount before making the decision to leave the labor market.
At what age will you be able to retire early in 2027?
Starting from January 1, 2027, the ordinary retirement age will be established at 67 years for those who have contributed less than 38 years and six months, while workers who prove 38 years and six months or more will be able to retire at 65 years. This schedule also determines the minimum ages to request early retirement, as the voluntary modality allows bringing forward retirement by a maximum of two years compared to the ordinary age that corresponds to each worker.
In this way, those who accumulate at least 38 years and six months of contributions will be able to request voluntary early retirement from the age of 63, while those who do not reach that period will generally have to wait until they are 65 years old. In addition, it will be necessary to prove a minimum of 35 years of effective contributions, of which at least two must be within the 15 years prior to retirement. The regulations also require that the resulting pension be higher than the minimum pension that would correspond to the interested party upon reaching the ordinary age.
The penalties for those entitled to a high pension in 2027
One of the main issues that future pensioners will have to check is the reduction coefficient that will be applied to their benefit. The pension reform of 2021 established a transitional regime between 2024 and 2033 for certain workers whose theoretical pension exceeds the maximum amount of the system, with the aim of progressively modifying the application of penalties for early retirement.
According to the tables planned for 2027, the reduction coefficients for advancing voluntary retirement by 24 months, when this transitional regime for pensions above the maximum is applicable, will be as follows:
-
Less than 38 years and six months of contributions: reduction of 10.80%.
-
Between 38 years and six months and less than 41 years and six months: reduction of 10%.
-
Between 41 years and six months and less than 44 years and six months: reduction of 9.20%.
-
44 years and six months or more of contributions: reduction of 7.60%.
These penalties are calculated on the maximum pension limit in the cases provided for by the transitional regulations and should not be confused with the general coefficients applicable to early retirements. In addition, the law incorporates a guarantee to prevent the progressive increase of cuts from causing a pension lower than what would have corresponded under the rules in force in 2021. Therefore, the percentages in the tables should not be interpreted as an automatic reduction identical for any worker with high income.
How the calculation of the pension changes from 2027
Next year, new developments will also come into effect in the formula used to calculate the retirement pension. Social Security will continue to apply a dual system for calculating the regulatory base, so that future pensioners can benefit from the alternative that is most favorable.
Specifically, in 2027 the traditional calculation based on the last 25 years of contributions will be compared with a second formula that will take into account the 304 best monthly bases within the last 308 months, equivalent to 25 years and eight months. The Social Security will automatically select the most beneficial result for the worker, a measure especially relevant for those who have gone through periods of unemployment or have had irregular contributions during the last years of their professional career.
Furthermore, starting in 2027, 37 years of contributions will be required to reach 100% of the regulatory base, compared to the 36 years and six months required until 2026. However, reaching that percentage does not necessarily mean receiving the maximum pension, since the final amount will also be conditioned by the retirement age, the contribution bases, and the corresponding reduction coefficients.
What you should check before applying for early retirement
Before applying for retirement, workers who aspire to receive a high pension must review their work history, the accumulated contribution bases, and the ordinary retirement age that corresponds to them. It is also advisable to check if they meet the minimum required period to access the early retirement modality and how many months they intend to advance their retirement, since the cuts vary depending on the time remaining to reach the legal age.
Another fundamental aspect is to determine whether the theoretical pension exceeds the maximum limit established by Social Security. This circumstance can modify the way penalties are calculated and, therefore, the final amount of the benefit. It is also advisable to compare different retirement dates, as delaying the application by a few months can reduce the applicable coefficient and allow for the accumulation of new contributions.
To carry out these checks, Social Security has an official retirement simulator, accessible from the Your Social Security portal, which allows estimating the future benefit based on the available contribution data. The tool offers the possibility to modify the planned retirement date and compare different scenarios, although its results are informative and do not replace the definitive administrative resolution.
Is it worth advancing retirement if you have a high pension?
The decision to retire early will depend on the economic and labor circumstances of each person. Those who have contributed at high bases for a good part of their career can maintain a considerable benefit even after applying the reduction coefficients, but bringing forward retirement implies accepting a reduction in the initial pension that does not automatically disappear upon reaching the ordinary age.
For this reason, experts recommend analyzing both the monthly amount that would be left unreceived and the number of years during which the benefit is expected to be collected, in addition to assessing the available income and savings. In the case of those who are close to the maximum pension, it is especially important to review the application of the transitional coefficients and the guarantees provided in the legislation.
With the arrival of 2027, the Spanish pension system will complete the transition of the ordinary retirement age initiated in 2013, while the gradual application of specific penalties for certain high pensions will continue. Therefore, those who are thinking of bringing forward their retirement should check which regulations apply to them and request a personalized simulation before starting the procedures with the National Institute of Social Security (INSS).