So there the normal public pension program....'pay-as-you-go', and the government to some degree can predict you will make 'X' upon retirement.
Then there's this private pension deal (the Riester pension) where you sign a contract, and a private company projects out....say in twenty to thirty years....based on X-amount coming in, you will get something like Y-amount in the end.
The common deal? You put in around 100-to-150 Euro a month, and there is some discussed amount of 300-to-350 Euro a month upon retirement.
Last night, ZDF (public TV, Channel Two) did a 40-minute documentary piece on the Riester pension. I would recommend a viewing.
The chief problem, as the journalists pointed out.....you typically never make the 300-to-350 Euro, and in some cases.....you stand there making 78 Euro (not even the amount that you put into the system monthly for the twenty year period).
A lot depends on the investment strategy of the company, and how screwed up things get.
So what drives people to get into the Riester deal? Mostly because around age thirty, they add up the normal pension, and get disgruntled over the suggested amount of 1,000 to 1,200 Euro a month. You figure.....well, an extra 300 Euro would be a great benefit.
The odds that this documentary piece will sour Germans on the deal? I might go and suggest that.
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