Is Claiming Labor Pension at 65 a Loss? Expert Reveals the 'Best Age to Claim,' Retirees Can Receive Up to NT$900,000 More Than Others by Death

How to claim your labor pension most advantageously is a top concern for workers across Taiwan. Starting in 2026 (Minguo Year 115), the statutory age to claim old-age labor pension benefits will officially rise to 65. For example, workers born in Minguo Year 51 must wait until 2027 to receive full pension benefits. Amid these institutional changes, should you claim early, on time, or delay? Labor insurance expert 'Secretary Zhang' analyzed the issue in depth on his YouTube channel, 'Labor Friend's Secretary – Secretary Zhang.'

The first step to finding your optimal claiming age is clarifying whether you are currently 'still covered by insurance' or have 'fixed contribution records (no longer insured).'

According to current regulations published by the Bureau of Labor Insurance, old-age benefits mainly come in three forms: 'Old-Age Annuity Benefit (monthly payment),' 'Old-Age Lump-Sum Payment,' and 'Lump-Sum Withdrawal of Old-Age Benefits.' Workers with at least 15 years of insurance coverage can choose the monthly annuity option; those with less than 15 years receive a lump-sum payment. Additionally, workers who had insurance records before January 1, 2009 (Minguo Year 98), when the labor pension annuity system was implemented, are eligible to opt for the 'lump-sum withdrawal.'

Do Working Employees and Retirees Have Different Claiming Strategies? Expert Reveals the Golden Crossover Point for Both Groups!

Secretary Zhang explains that 'working employees'—those still contributing premiums and possibly earning rising salaries—do not need to rush to claim at age 60. Precise calculations show that for those continuously insured, the 'golden crossover point' occurs around ages 62 to 63. Claiming at this stage typically maximizes cumulative total benefits.

However, Secretary Zhang warns that this calculation assumes the monthly benefit has already reached an average level. If your insurance tenure is only around 20 years, claiming too early is not recommended, as doing so with short contribution history and sub-maximum insured salary puts you at a significant disadvantage.

In contrast, for retirees who have already left their jobs and 'no longer insured,' Secretary Zhang offers completely different advice: he encourages claiming at age 60 (with a 20% reduction) rather than blindly waiting until age 65 or even 70. Within an 85-year life cycle, starting at age 60 turns out to be the most advantageous. Although early claiming reduces the monthly amount by 20%, recipients collect benefits for five full years longer than those who wait until 65, resulting in a significantly higher cumulative total.

Why Does Early Claiming Offer Advantages? Three Hidden Incentives Revealed: Price Adjustments and Compound Interest!

Beyond the direct benefit of collecting five extra years of payments, Secretary Zhang further analyzes three hidden incentives for early claiming.

First is the 'Consumer Price Index (CPI) Adjustment Mechanism.' The labor pension includes an adjustable mechanism tied to the Consumer Price Index. Whenever cumulative inflation exceeds 5%, benefit amounts are increased. The earlier you begin claiming, the more times you experience these upward adjustments. Over time, the monthly amount in your pocket could end up nearly matching that of someone who claimed later.

Second is 'Investment Returns and Compound Interest Effect.' Cash received a few years earlier can be deposited into savings accounts to earn interest or invested in recognized stable assets such as stocks and ETFs. The long-term compound returns generated often far exceed the incremental gains from delayed claiming.

Third is 'Dispelling National Insurance Myths.' Many people, after leaving employment, try to switch to National Pension (Guo Bao) to qualify for 'double pensions.' However, the increase in National Pension benefits is extremely limited. Instead of continuing to pay premiums out of pocket, it’s wiser to claim your labor pension early and secure the funds immediately.

How Much Difference Is There Between Early and Delayed Claiming? Real Calculations Show Nearly NT$900,000 More!

Consider a retiree with '30 years of labor insurance, a five-year average insured salary of NT$40,000,' who will no longer continue coverage. Here’s a simulation:

- Claim at age 60 (20% reduction): monthly NT$14,880 - Claim at age 65 (full amount): monthly NT$18,600 - Claim at age 70 (20% increase): monthly NT$22,320

However, comparing cumulative totals assuming benefits are collected until age 80, the results reverse dramatically:

- Claiming from age 60: over NT$3.57 million (highest among all scenarios) - Claiming from age 65: over NT$3.34 million - Claiming from age 70: over NT$2.67 million

Compared to those who delay until age 70, those who claim at age 60 receive nearly NT$900,000 more in total—shattering the traditional myth that 'the later you claim, the more you get.'