Procedures and requirements to retire

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Every working citizen, after long years of responsible and constant work, wishes to enjoy his retirement as a member of Social Security. In Ecuador, you do not necessarily need to be 60 years of age to qualify for retirement. Below we will detail the requirements to retire in that country.

The Ecuadorian Institute of Social Security (IESS) indicates that all dependent, self-employed or voluntary affiliates have the right to a lifetime retirement pension.

Requirements to retire

Among the general requirements to retire in Ecuador, it is essential to consider meeting the age and time of service required, detailed below:

  • 60 years of age and 30 years of contribution.
  • 65 years of age and 15 years of contribution.
  • 70 years of age and 10 years of contribution.
  • 40 years of contribution and any age.

Years of work vary by ageSince older affiliates may request retirement with fewer years of contribution, while affiliates who are over 40 years old in contribution to the Ecuadorian Social Security Institute (IESS) may request retirement at any age. The other requirements consist of:

  • Be unemployed with all employers and record the notice of departure.
  • Not be in default as an employer with the Ecuadorian Social Security Institute (IESS).
  • Bear in mind that the contributions for the month that ceased must be paid before the 15th of the following month.
  • Have an active and personal bank account, registered in the Labor History System.

It is important to note that the pensioner’s card is no longer necessary, the only requirement to access medical services or other processes is to present the citizenship card; This is because the Ecuadorian Social Security Institute no longer issues this document.

If a pensioner certification is required, it can be reviewed online through the website, in the pensioner section by entering the item Pensioner Certificate.

How to verify contributions?

If at least 10 years of work have been completed under a dependency relationship, it will be possible to verify how many contributions have accumulated, in order to calculate the minimum age at which as a citizen you could retire. These details can be consulted on the website www.iess.gob.ec by following these steps:

  1. Click on the Pensioner item and then on the Retirement item.
  2. It will be necessary to have a username and password to access any service in the IESS system.
  3. Next, one of the four options shown must be selected: retirement due to old age, ISSFA, ISSPOL and zafreros (Sugar mill workers).
  4. Once there, the personal data of the citizen will appear.
  5. To verify if the contributions are complete, the option See Contributions must be selected.
  6. The table will immediately appear with the personal and employer contributions in each of the companies where you have worked.

Steps to Retire

When meeting both requirements (chronological and working ages) to process retirement, the following steps must be followed to request the pension:

  1. Enter the IESS website.
  2. Locate the Pensioner section and then the Retirement option.
  3. Enter key and password.
  4. Locate the option Register request in the left sector of the page.
  5. Again, one of the four available options must be chosen: old-age retirement, ISSFA, ISSPOL or Zafreros.
  6. Once the IESS validates that the citizen meets all the requirements (indicated with a green check), you can click Continue.
  7. It must be confirmed that the personal data is correct, such as full name, age and number of total deposits.
  8. Finally, you can check the status of your retirement application in the left menu.

How is the retirement pension calculated?

The Ecuadorian Institute of Social Security indicates that to establish the basis for calculating the transition regime pension, the average of the five (5) years of better salaries on which it was contributed must be taken into account.

Then twelve consecutive months of wages must be added, counted from the first contribution of employment history, repeating the process until reaching the current month of contributions. Each of the full years (12 continuous months) that the citizen has worked, will give a definitive sum that represents the annual income obtained on those occasions.

In order to access retirement, the minimum number of contributions is 120 consecutive, or failing that, a total of 10 years working under a dependency relationship.

Retirement by the IESS is based on a table of coefficients that goes according to the number of full years of taxation:

Examples

  • A citizen in condition to retire, who has been working for 10 years and whose best 5 years are equivalent to a total of $ 30,000, would have an income of approximately $ 250:
    Top 5 years of salaries: $ 30,000 / 5 (years) = $ 6,000 (average earnings per year).
    $ 6,000 / 12 (months) = $ 500 (average monthly income).
    $ 500 x 0.5 (coefficient for 10 years of deposits) = $ 250 (monthly income to be received).
  • A citizen in condition to retire, who has been working for 20 years and whose best 5 years are equivalent to a total of $ 65,000, would have an approximate income of $ 677.08:
    Top 5 Years Salaries: $ 65,000 / 5 (Years) = $ 13,000 (Average Earnings Per Year).
    $ 13,000 / 12 (months) = $ 1083.33 (average monthly income).
    $ 1083.33 x 0.625 (coefficient for 20 years of deposits) = $ 677.08 (monthly income to be received).

If you want to know how much the monthly income you have accumulated to date, you must enter the IESS website, selecting the Pensioner and Retirement option, and then the option See approximate income.

Pension values

The minimum and maximum old-age pensions are established according to the contribution time, in proportion to the basic unified minimum wage of the worker in general.

According to the IESS, these are the minimum pensions, according to the contribution time:

  • $ 193 up to 10 years of contribution.
  • $ 231.60 from 11 to 20 years old.
  • $ 270.20 from 21 to 30 years old.
  • $ 308.80 from 31 to 35 years old.
  • $ 347.40 from 36 to 39 years old.
  • $ 386 40 and over.

On the contrary, for the maximums the age range varies, such as:

  • $ 965 from 10 to 14 years of contribution.
  • $ 1,158 from 15 to 19 years of contribution.
  • $ 1,351 from 20 to 14 years of contribution.
  • $ 1,544 from 25 to 29 years of contribution.
  • $ 1,737 from 30 to 34 years of contribution.
  • $ 1,930 from 35 to 39 years of contribution.
  • $ 2,123 from 40 years of contribution onwards.

Types of retirement

The types of retirement are classified according to their cause, which will be detailed below:

  • Ordinary old-age retirement: the member or affiliate who meets the requirements demanded by the IESS, has the right to lifetime monthly pensions, the same that are paid from the first day of the month following the one in which the insured ceased in the or jobs. The member who meets the requirements for termination, age and time of contributions to the IESS is entitled to receive a lifetime monthly old-age retirement pension.
  • Retirement due to disability: it consists of a monthly benefit that can be requested if you have a physical or intellectual disability, which prevents a natural performance to work.
  • Retirement due to old age: it is a contributory cash benefit to which every worker is entitled as a retirement from paid activity, provided they meet certain age requirements and services provided.

Similarly, there are two types of retirement: contributory and non-contributory.

The contributory modality is the one that is financed by the contributions made to the system by the workers themselves through their contributions or contributions and those of their employers, commonly known as employer contributions.

The non-contributory modality is the one destined to those people who have not contributed enough to benefit and generate rights in the other modality.

What is the IESS?

The Ecuadorian Institute of Social Security (IESS) is an autonomous entity founded on July 10, 1970, which is part of the social security system of Ecuador. It is the entity responsible for apply compulsory universal insurance according to the Constitution of the Republic of Ecuador.

It remains as an autonomous entity, with legal status and with its own resources other than those of the National Treasury; With an organic structure founded over the years, the IESS is considered the largest and most important social institution in the country.

Retirement benefits

Early retirement provides the same total amount of Social Security benefits for your entire life, but in smaller amounts to take into account the longer period you will receive them. If the citizen retires later, he will receive benefits for a shorter period of time, but the monthly amounts will be higher to compensate for the months in which he did not receive retirement income.

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