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Germany has several safety networks: - Arbeitslosengeld is an unemployment insurance money paying 60% (alone) to 66% (families) of former income for one or two

by kephra 13y ago

Germany has several safety networks: - Arbeitslosengeld is an unemployment insurance money paying 60% (alone) to 66% (families) of former income for one or two years. But you have to pay into insurance first. Payment is deducted automatically by payroll tax. - Hartz IV offers Euro350+housing per month, if you are available for the job market. Now for entrepreneurs Germany offers a Gruendungszuschuss. Thats 60% of the former income + Euro300 for half a year longer then Arbeitslosengeld. Unlike Arbeitslosengeld its completely tax free, and nearly without requirement. Health, unemployment, and retirement insurance for self employed are voluntary. Most self employed take health insurance, and omit the the other two. Last not least its possible to go to Hartz IV as a self employment. This is a pain in the ass, as one has to show them your books every month, to get the difference between income an Hartz IV money. Now the drawbacks. Health insurance for self employed assumes that you at least earn Euro2000, and charges 15% = Euro300 per month minimum. They will charge more, if you earn more, but wont cache back, if you earned less. Most entrepreneurs don't have retirement insurance, because its to expensive when you start your business, and once you lack retirement insurance by being unemployed or self employed, the payout is less then Hartz IV. Retirement insurance worked fine for my parents, who had been employed for more then 40 years. But I'm 47 now, worked only 3 years as a slave, and would get less then Euro100 for retirement. There is an infamous politician, called von der Leyen, who came up with the internet Stopp sign, and who is proposing forcing self employed into retirement insurance. I hope she fails here again, as forcing retirement insurance would force many small self employed to close business and to go unemployed again.

Xylakant 13y ago
Sorry to say, but you're not really up to date here. Restrictions have been tightened and benefits cut in the last years: > Arbeitslosengeld is an unemployment insurance money paying 60% (alone) to 66% (families) of former income for one or two years. It's a maximum of 12 month unless your 50 or older. The minimum is at 6 month. The actual duration depends on how many month you were employed in the last 5 years. You need to have at least 12 month to be eligible at all. If you're on/off employments the times get summed up. > Gruendungszuschuss used to be a fine thing up until 2011 when it became voluntary from the government side. Before it used to be that any application that passed a very low bar would get accepted, now it depends. It's actually your unemployment money plus a fixed amount for health insurance. The fixed amount gets paid for up to a year and can get extended. You must be unemployed on the day that you apply. This is the reason I was unemployed for a single day - applied and founded the next day. If you're trying to convert a running side-job things get tricky. If your business fails and you're trying to get another Gründungszuschuss you'll not get it. > Health, unemployment, and retirement insurance for self employed are voluntary. Health insurance is mandatory nowadays. You can still choose which, but you must choose one. > Last not least its possible to go to Hartz IV as a self employment. You can try, but you'll probably fail. Hartz IV has a lot of obligations attached, such as having to go to job interviews when they send you an offer. That doesn't sit well with founding. > Now the drawbacks. Health insurance for self employed assumes that you at least earn Euro2000 The first year they ask you for an estimate. It's true that you don't get your money back, so go for a low estimate. Don't lowball it though, there's a lot of freelance that get taken by surprise when they have to pay up at the end of the term. Rules for private health insurance might differ, I don't know about that. However, if you earn much less than 2000 Euro you're in trouble anyways, after taxes there's not much left of that. I always assume that ~ 40% of what I invoice is taxes. > There is an infamous politician, called von der Leyen, who came up with the internet Stopp sign, and who is proposing forcing self employed into retirement insurance. Actually, I hope that this push succeeds. There could be exemptions for the first (two?) years, but any self employed person that can't afford retirement savings is just kicking the can down the road.
- kephra 13y ago
  > Actually, I hope that this push succeeds. For me it would be a reason either to leave Germany! I'm 47 years old, and worked less then 4 years employed. The result is, that my retirement insurance would be less then Hartz IV, even if I start retirement insurance and work till 70. Unemployed, and retirement insurance make no sense. Not for normal pay roll worker, and even less for self employed.
  - gaadd33 13y ago
    I'm a little confused, in the US everyone (including the self employed, and I want to say people receiving unemployment) pay into social security but very few people in the tech industry expect to live on that alone, at best it would be a supplement to retirement savings. So are you saying that instead of paying into a retirement insurance plan you are just going to depend on Hartz IV to support you in retirement?
  - Xylakant 13y ago
    So if you're 47 you either have some savings for your retirement or you need to build some very fast. Otherwise you'll be living of Hartz IV anyways. I fail to see your point? Do you want to rely on social security while not paying into the social system - sorry, for me that doesn't work. I'm all for making freelancers save money for when they're older, as long as they can choose how they want to do it.

by kephra 13y ago

Xylakant 13y ago

Sorry to say, but you're not really up to date here. Restrictions have been tightened and benefits cut in the last years: > Arbeitslosengeld is an unemployment insurance money paying 60% (alone) to 66% (families) of former income for one or two years. It's a maximum of 12 month unless your 50 or older. The minimum is at 6 month. The actual duration depends on how many month you were employed in the last 5 years. You need to have at least 12 month to be eligible at all. If you're on/off employments the times get summed up. > Gruendungszuschuss used to be a fine thing up until 2011 when it became voluntary from the government side. Before it used to be that any application that passed a very low bar would get accepted, now it depends. It's actually your unemployment money plus a fixed amount for health insurance. The fixed amount gets paid for up to a year and can get extended. You must be unemployed on the day that you apply. This is the reason I was unemployed for a single day - applied and founded the next day. If you're trying to convert a running side-job things get tricky. If your business fails and you're trying to get another Gründungszuschuss you'll not get it. > Health, unemployment, and retirement insurance for self employed are voluntary. Health insurance is mandatory nowadays. You can still choose which, but you must choose one. > Last not least its possible to go to Hartz IV as a self employment. You can try, but you'll probably fail. Hartz IV has a lot of obligations attached, such as having to go to job interviews when they send you an offer. That doesn't sit well with founding. > Now the drawbacks. Health insurance for self employed assumes that you at least earn Euro2000 The first year they ask you for an estimate. It's true that you don't get your money back, so go for a low estimate. Don't lowball it though, there's a lot of freelance that get taken by surprise when they have to pay up at the end of the term. Rules for private health insurance might differ, I don't know about that. However, if you earn much less than 2000 Euro you're in trouble anyways, after taxes there's not much left of that. I always assume that ~ 40% of what I invoice is taxes. > There is an infamous politician, called von der Leyen, who came up with the internet Stopp sign, and who is proposing forcing self employed into retirement insurance. Actually, I hope that this push succeeds. There could be exemptions for the first (two?) years, but any self employed person that can't afford retirement savings is just kicking the can down the road.

kephra 13y ago
> Actually, I hope that this push succeeds. For me it would be a reason either to leave Germany! I'm 47 years old, and worked less then 4 years employed. The result is, that my retirement insurance would be less then Hartz IV, even if I start retirement insurance and work till 70. Unemployed, and retirement insurance make no sense. Not for normal pay roll worker, and even less for self employed.
- gaadd33 13y ago
  I'm a little confused, in the US everyone (including the self employed, and I want to say people receiving unemployment) pay into social security but very few people in the tech industry expect to live on that alone, at best it would be a supplement to retirement savings. So are you saying that instead of paying into a retirement insurance plan you are just going to depend on Hartz IV to support you in retirement?
- Xylakant 13y ago
  So if you're 47 you either have some savings for your retirement or you need to build some very fast. Otherwise you'll be living of Hartz IV anyways. I fail to see your point? Do you want to rely on social security while not paying into the social system - sorry, for me that doesn't work. I'm all for making freelancers save money for when they're older, as long as they can choose how they want to do it.