"Nenkin Navi" Launches "Breakeven Point Simulator" for Pension Deferral/Advancement ── Graphically Displays the Age at Which Total Benefits Reverse for Start Ages from 60 to 75

The information service "Nenkin Navi" (https://nenkin.xyz) has launched a "Breakeven Point Simulator" that allows users to visually understand the breakeven point for early or deferred pension claims. Tool URL: https://nenkin.xyz/tools/breakeven-simulator

### Changes to the Pension Deferral/Advancement System
While Japan's public pension system principally starts payments at age 65, individuals can choose to start receiving it earlier, from age 60, or defer it later, up to age 75. A pension system reform in April 2022 raised the maximum deferral age from 70 to 75 (Source: Ministry of Health, Labour and Welfare "2020 Pension System Reform"). Deferring until age 75 results in an 84% increase in benefits, meaning one can receive approximately 1.84 times the monthly pension for life compared to starting at 65. On the other hand, for those who turn 60 after April 2022, advancing the claim results in a 0.4% reduction per month, leading to a 76% benefit amount if started at age 60. This reduction applies for life.

### Judging "How Long Must I Live to Benefit?" with the Breakeven Point
Starting early means smaller monthly payments but receiving them sooner. Deferring means larger monthly payments but a later start. Which is more "profitable" ultimately depends on "how long you continue to receive it," i.e., your lifespan. The concept of a "breakeven point" helps in this judgment. When comparing the cumulative amount received starting at 65 versus, for example, starting at 70, there is a point at which the cumulative total reverses. If you live longer than that point, deferring is more advantageous; if you pass away before it, starting at 65 would have been better. While understandable in theory, manual calculation is difficult due to the complex rules for applying increase/decrease rates. This tool has an AI that performs these calculations instantly and displays the results in a graph.

### How the Simulator Works
**Input Items**
- Estimated annual pension amount at age 65 (can be an estimate if the official "Nenkin Teikibin" statement is unavailable)
- Combination of desired pension start ages for simulation (up to 5 patterns simultaneously)

**Output Content**
1. **Cumulative Benefit Transition Graph**: A line graph displays the cumulative benefits from age 60 to 100 for each selected start age. The intersection points are the breakeven points.
2. **List of Breakeven Ages**: Shows the numerical breakeven ages for each combination, such as "65 vs 70," "65 vs 75," and "60 vs 65."
3. **Comparison with Japanese Life Expectancy**: References data from the Ministry of Health, Labour and Welfare's "Abridged Life Tables" to display life expectancy based on current age (Source: MHLW "2023 Abridged Life Tables"). The difference between life expectancy and the breakeven age provides a statistical basis for judgment.
4. **Comparison Table of Monthly Benefit Amounts**: Displays the monthly benefit amounts for each start age side-by-side, allowing for an intuitive grasp of "how much the monthly difference is."

### What to Know Before Choosing to Defer
While deferring pension benefits has the advantage of increasing the amount received, there are often overlooked disadvantages. This tool displays the following points of caution along with the simulation results.

**Potential Loss of Additional Pensions (Kakyu Nenkin)**
During the period you are deferring your old-age employees' pension, additional pensions (such as for a dependent spouse) are suspended. Since the annual amount of this additional pension can be up to approximately 400,000 yen, a longer deferral period results in a larger total amount of forfeited benefits.

**Increase in Taxes and Social Insurance Premiums**
An increased pension amount from deferral also leads to higher income tax, residence tax, national health insurance premiums, and long-term care insurance premiums. The increase rate of the gross amount does not match the increase rate of the net take-home amount, so this tool also displays an estimated after-tax amount as a reference.

**Relationship with the Pension System for the Employed Elderly**
If you continue to work and are enrolled in the employees' pension system after age 65, a portion of your pension will be suspended if the sum of your wages and pension exceeds a certain threshold (500,000 yen per month in FY2024). The suspended portion is not eligible for the deferral increase, so deferring while employed may have a limited effect.

### Usage Tips
**Case 1: An employee in their late 50s approaching retirement**
To consider whether it's better to take the pension early if retiring at 60 or defer it if working until 65 under a re-employment scheme, you can compare with concrete numbers. This can be used as a foundation for post-retirement income planning.

**Case 2: Someone who has already turned 65 but has not yet claimed their pension**
Pension payments do not start automatically; a claim form must be submitted. While the procedure is on hold, it is automatically treated as a deferral. This tool can help decide whether to "keep waiting or file the paperwork now."

**Case 3: Someone advising their parents on pension claims**
When asked by elderly parents "when should I start receiving my pension?", you can use data instead of intuition. By inputting the parent's pension amount and looking at the graph together, it facilitates family consensus-building.

### Update Plans
Nenkin Navi plans to add features for checking eligibility for survivor and disability pensions, as well as a tool to optimize the receiving order with iDeCo and corporate pensions. The total lifetime amount received from the public pension system can vary by millions of yen depending on how it is claimed. We will continue to expand our services to support informed decisions based on an accurate understanding of the system.

*The simulation results of this tool are estimates, and calculations for taxes and social insurance premiums are simplified. Please confirm your exact pension amount with the "Nenkin Net" service or a pension office.