How to guarantee the well-being of your children when you are gone. The orphan’s pension is the Social Security benefit that protects the situation of vulnerability in which our children are left because they do not have the necessary financial resources in the face of the loss of any of their parents.
From the moment you are a father or mother, protecting your children becomes the highest priority:
- Giving them a good education.
- Proper nutrition.
- Taking care of their health.
- Making them happy is the most basic of our concerns.
But what if we are no longer by their side to take care of them? Is the public pension enough to ensure your well-being? Premature death can cause significant emotional and economic damage to the family, especially affecting the weakest.
Up to what age can your children be entitled to this benefit?
In general, children under 21 years of age or the elderly have an absolute permanent disability or severe disability.
Both the children of the deceased and those of his spouse will be entitled to the orphan’s pension, provided that they have been married for more than two years and there is economic dependency.
In the event that orphans do not receive income or it is less than the SMI (€950/month in 14 payments for 2021), they may receive the orphan’s pension up to the age of 25.
When is the right generated?
Orphan benefits can be caused by both an active subject, that is, a worker, and a permanent disability or retirement pensioner in their contributory modality.
With the following requirements:
- A worker registered or in a situation assimilated to registration at the time of death or a pensioner in their contributory modality will generate the right without any other additional requirement.
- If the worker is in a situation of NOT HIGH, he must accumulate at least 15 years of contributions to cause the orphan’s pension for his children.
How much would the beneficiaries receive?
In general, the orphan’s pension is 20% of the regulatory base for each orphan. However, the sum of the orphan’s pensions for all the children and the spouse’s widow’s pension, if applicable, cannot exceed 100% of the regulatory base.
If the orphan is absolute, the orphan’s pension is increased by the amount of the widow’s pension (because being the absolute orphan, the spouse does not receive this right). If there are several orphans entitled to this increase, it is distributed equally among all of them.
What is my regulatory basis?
If the deceased is a disability or retirement pensioner, the regulatory basis is the same as that used to determine his pension.
If you are discharged or a situation assimilated to discharge at the time of death, it is distinguished according to the cause of death:
- Common illness or non-occupational accident: the regulatory base is the result of the sum of 24 uninterrupted bases, chosen within the 15 years prior to death, divided by 28.
- Occupational disease or accident at work: the regulatory base is the actual salary at the time of death.
Is there a minimum and maximum in the orphan’s pension?
Orphan’s pensions have a minimum amount that, in general, for a beneficiary without a disability is set at €210.80 in 2021.
Minimum orphan pensions in 2021:
As for the maximum amounts, if there is a widow’s pension, in no case may the sum of the orphan’s pension exceed 48% of the regulatory base. If there is no widow’s pension, this limit will be 100%.
How are orphan pensions taxed?
The pension is exempt from personal income taxation.
Is the orphan’s pension compatible with paid work?
In the event that the orphan is under 21 years of age or has an absolute permanent disability or severe disability, the pension will be paid regardless of the income derived from his work.
On the other hand, if the orphan is over 21 years of age, without disability, the orphan’s pension will be suspended from the day following the day on which he begins a job as an employee or self-employed, provided that the income obtained from it exceeds the SMI, or from the moment they get over it. The right to the pension will be recovered when the income is extinguished or when it is less than the SMI minimum.
Is the orphan’s pension compatible with other benefits?
The pensions of the same scheme are incompatible with each other when they coincide in the same beneficiary; that is, if you are entitled to two or more pensions, you must opt for one of them. However, the orphan’s pension is compatible with another orphan’s pension, one for each of the parents, although in this case, there are also limits since only one of them could be increased with the percentage of widowhood.
When does the right end?
As we have seen previously, 21 years of age is generally the age limit for receiving the pension unless the orphan has recognized absolute permanent disability or severe disability. The rest of the cases to stop receiving the pension are the following:
- For turning 25 years old, when the orphan does not work or his income is less than the SMI; also if you have a disability equal to or greater than 33%.
- For ceasing the disability that gave the right to the pension before the age of 25 in the previous case.
- By adoption.
- By getting married, unless the orphan had a recognized absolute permanent disability or severe disability.
Is it very expensive to complement the orphan’s pension with life insurance taken out in a private way?
Social Security protection is limited by the contributions made by each worker, regardless of their protection needs. Therefore, it is absolutely essential to carry out an exercise of responsibility and know what the situation of our family, of our children, would be in the event of premature death.
In most cases, the orphan’s pension would not cover the expenses we face as parents: maintenance, clothing, schools, extracurricular activities, savings for higher education, etc. Knowing this limitation makes it easier for us to anticipate our needs and cover them with guarantees.
The Family Protection legitimate Life Insurance and Family Income Protection provide us with the necessary guarantees and capital to protect our family and ensure an economic future without shortages.