In Ukraine, working pensioners have the right to a recalculation of their pension payments every two years; however, this process can lead not only to an increase in the pension but also to a decrease.
This is reported by Finway
Impact of Recalculation on Pension Amount
According to part four of Article 42 of the Law of Ukraine “On Mandatory State Pension Insurance,” the recalculation of pensions for those who continue to work is possible after accumulating at least 24 months of insurance experience. However, if a pensioner’s salary coefficient decreases, even against the backdrop of rising average salaries nationwide, this may mean that the pension amount will become smaller.
“The pensioner chooses the most advantageous recalculation option, and during the annual automatic recalculation starting April 1, the Pension Fund is obliged to consider only the best option for the individual.”
Pensioners can independently determine which approach to recalculation is more beneficial for them: to consider only insurance experience or experience along with earnings. Every year, starting April 1, the Pension Fund conducts an automatic recalculation, during which specialists must consider only the best option for the pensioner.
How Pension is Calculated: Key Indicators
The amount of pension in Ukraine is determined by three main indicators: the duration of insurance experience, the amount of personal salary, and the average salary in the country over the last three years. The calculation formula is as follows: the ratio of personal salary to the average salary in the country is multiplied by the number of years of experience and by 1%, and the result is multiplied by the average salary for the last three years.
As of now, the average salary over three years is 15,057.09 UAH. If a person has 35 years of experience and received the average salary in the country, their pension will amount to 5,269.9 UAH. With a salary that is twice the average, the pension amount increases to 10,539.9 UAH.
Regional Differences in Pension Amounts
The highest pensions are received by residents of Kyiv — on average, this is 8,856.57 UAH. This is explained by the high level of salaries in the capital. The second highest pensions are in the Donetsk region (7,840.27 UAH), while the third position is held by the Luhansk region (7,322.25 UAH). At the same time, the lowest pensions are recorded in the Ternopil (4,957.1 UAH), Chernivtsi (5,136.85 UAH), and Transcarpathian (5,210.9 UAH) regions. The amount of pension directly depends on the official salary and the duration of insurance experience.