An employee who retires loses on average a significant portion of their working income. This gap between the last salary and the first pension surprises many future retirees. Preparing for retirement means first measuring this gap, then bridging it with decisions made early enough for time to work in your favor.
Gap between legal retirement age and actual retirement age
Competitors often talk about the age to start saving. They rarely address a point that changes the entire strategy: the difference between the legal retirement age and the age at which one actually retires.
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Since the 2023 reform, the legal age is gradually being pushed back. The Drees, in its overview “Retirees and Pensions” (2023 edition), confirms a clear trend towards an increase in the average actual retirement age. This gap already existed with the Touraine reform, and it is widening.
Why does this point change your preparation? Because there can be several months, sometimes a few years, between the end of full-time employment and the liquidation of rights. After 60, finding a stable position becomes more difficult. Therefore, it is necessary to plan for “bridges” of income to cover this period: unemployment benefits, part-time work, or a combination of work and retirement.
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The law of April 14, 2023, has also relaxed the rules for full work-retirement combination. A retired employee who resumes work can now open new pension rights thanks to this resumption. This is a concrete lever, still little exploited, that the Pôle Finance retirement page details among other strategies tailored to each profile.
Simulating your retirement pension: the concrete starting point
Before choosing an investment or opening a savings plan, there is a step that many postpone: estimating the actual amount of your future pension. Without this figure, any strategy remains vague.
The Info Retraite website, common to all mandatory schemes, offers a personal account accessible at any time. This online service consolidates all your acquired rights from your various funds. You can perform personalized simulations based on your planned retirement age.
Check your career statement
Have you ever noticed missing periods on a career statement? This is common, especially for people who have changed employers multiple times or worked abroad. Each unaccounted quarter reduces the final pension.
Correcting your career statement before age 55 avoids urgent steps at the time of retirement. Regularization takes time: gathering pay slips, contacting former funds, sometimes providing certificates. It is better to start early.
Calculate the gap between pension and actual needs
Once the simulation is done, compare the estimated amount to your current expenses. Subtract work-related costs (transportation, meals, professional clothing). Add in the expenses that increase with age, particularly health and housing adaptations.
The gap obtained is the monthly amount that your savings will need to cover. This simple calculation provides a precise goal, much more useful than a general rule like “save a certain percentage of your income.”
Retirement savings plan PER and life insurance: two different logics
Retirement savings solutions are plentiful, but two vehicles dominate the French landscape: the PER and life insurance. Their tax logic and flexibility differ, and choosing one over the other depends on your situation.
The PER: a tax advantage at entry
The Retirement Savings Plan allows you to deduct voluntary contributions from your taxable income, within certain limits. The higher your marginal tax rate, the greater the tax savings at the time of contribution.
The trade-off: the funds are locked until retirement, except for exceptions (purchase of a primary residence, disability, death of a spouse). Upon exit, the capital or annuity is taxed. The PER is therefore suitable for taxpayers whose tax bracket will decrease at retirement.
Life insurance: flexibility above all
Life insurance does not lock up your money. After eight years of holding, withdrawals benefit from a tax allowance on gains. You can withdraw part of it at any time, making it a useful supplement to finance the transition period before the liquidation of rights.
A common strategy is to combine the two:
- Contribute to a PER as long as your working income is high, to reduce income tax each year
- Fund a life insurance policy in parallel, to have accessible savings before retirement age
- Adjust the allocation between euro-denominated assets (capital guaranteed) and units of account (potential for higher returns) according to your investment horizon
The longer the investment horizon, the higher the share in units of account can be. As retirement approaches, gradually securing capital on less volatile assets reduces the risk of loss at the wrong time.
End-of-career management: an often neglected angle
Financial preparation captures all the attention. The practical management of the last years of activity takes a back seat, even though it heavily impacts the final pension amount and the quality of the transition.
After 60, the risk of unemployment increases. A contract termination without a fallback solution can force you to liquidate your rights earlier than expected, with a permanent reduction in the pension. Anticipating this period requires considering several options:
- Negotiate a gradual transition to part-time work with the employer to smooth the drop in income
- Explore the work-retirement combination, which now generates new rights since the 2023 reform
- Check the conditions for accessing progressive retirement, which allows you to receive a portion of your pension while continuing to work
- Buy back missing quarters if the cost remains lower than the gain on the pension (the calculation is done on a case-by-case basis)
Each missing quarter can permanently reduce the pension. The buyback becomes more expensive as you age, which reinforces the importance of addressing it well before retirement.
Preparing for retirement is not limited to opening a PER or life insurance policy. It begins with a precise diagnosis of your situation, involves a savings strategy tailored to your tax situation, and includes active management of your last years of work. The work-retirement combination, progressive retirement, and buying back quarters are technical levers that, when combined, can represent several hundred euros of additional monthly pension.