Take the National Pension 5 years early and it is cut 30% for life
Someone born in 1970 draws the old-age pension from 65. Bring it forward five years to 60 and it is cut 6% a year, 30% in all, so ₩1,000,000 a month becomes ₩700,000, for life. Defer five years to 70 and it rises 7.2% a year, 36%, to ₩1,360,000. Which is right depends on health, income and other savings; by simple arithmetic the early option breaks even around 77 and deferral around 84.
Conditions used in the video
- Birth year
- 1970 → pension age 65
- Contribution period
- 20 years
- Basic pension
- ₩1,000,000 a month
- Early reduction
- 6% a year, max 5 years = 30%
- Deferral increase
- 0.6% a month (7.2% a year), max 5 years = 36%
Results
- At 65, normal
- ₩1,000,000 a month
- At 60, early
- ₩700,000 a month
- At 70, deferred
- ₩1,360,000 a month
- Early break-even (simple)
- about 77
- Deferral break-even (simple)
- about 84
At a glance
Born 1970 · 20 years · basic pension ₩1M. Inflation indexing excluded.
- 60, early (−30%)₩700,000
for life
- 65, normal₩1,000,000
- 70, deferred (+36%)₩1,360,000
for life
Why it works this way
Being told you can draw the National Pension early is tempting. But it is cut for every year you bring it forward, and the cut lasts for life.
Take someone born in 1970, 20 years of contributions, an expected basic pension of ₩1,000,000 a month.
국민연금법 제64조의2.
- Normal₩1,000,000 a month from 65
- Earlyfrom 60, 6% off per year, 30% at five years
- Monthly₩700,000. It does not return to ₩1,000,000 at 65
Early old-age pension requires 10+ years of contributions and income below a threshold; income while drawing it can suspend payment.
국민연금법 제62조.
- Deferredfrom 70, 0.6% a month, 7.2% a year, 36% at five years
- Monthly₩1,360,000
- Gap to early₩660,000 a month, same person
Deferral can be partial, from 50% to 100% of the pension.
So when is it better? Leaving out inflation indexing and income-based reductions, simple arithmetic: taking it from 60 collects ₩42M before 65 but then ₩300,000 less every month, so the lines cross around 77. Deferring to 70 forgoes ₩60M over five years but gains ₩360,000 a month, pulling ahead around 84.
So the numbers alone give no answer. Health, other income, dependants' pension and health insurance premiums all matter. But 'early means 30% less for life' is something to know before deciding.
In short: for a 1970-born ₩1M pension, 60 early is ₩700,000, 65 normal is ₩1,000,000, 70 deferred is ₩1,360,000, and the difference lasts for life.
The legal basis
Drawn from government announcements and the statutes themselves as primary sources, covering only the relevant part.
국민연금법 제61조제1항 · 부칙 제21조 (old-age pension, pension age)
In force In force
A person with 10 or more years of contributions receives an old-age pension for life from age 60 (by the addenda: 61 for those born 1953 to 56, 62 for 1957 to 60, 63 for 1961 to 64, 64 for 1965 to 68, 65 for 1969 and later).
What this means
Born 1970: 65.
국민연금법 제64조의2 (early old-age pension)
In force In force
A person with 10+ years of contributions aged 55 or over (60 for those born 1969 and later) who is not engaged in income-earning work may, on request, receive the pension before pension age, reduced by 60/1000 of the basic pension for each year brought forward.
What this means
🔴 6% a year, 30% at five years, and the reduced amount is paid for life.
국민연금법 제62조 (increase for deferred payment)
In force In force
A recipient may once defer 50 to 100% of the pension until five years past pension age, with 6/1000 added for each month deferred.
What this means
0.6% a month, 7.2% a year, 36% at five years, also for life.
Run it on your own numbers
The calculator opens with these conditions already filled in. Change the figures and your own case comes straight out.
Open the National Pension Timing
Frequently asked
Are there conditions for taking it early?
10+ years of contributions and no income-earning work above the A-value (average income of all members). Income above that while drawing suspends payment.
Does it go back to the full amount at 65?
No. The early-pension reduction applies for life. The amount is indexed for inflation, but the reduction rate stays.
Are the 77 and 84 break-evens fixed?
No. They leave out inflation indexing, income-based reduction and the dependants' pension. They are simple monthly sums to show direction, not an individual result.
Must deferral be all or nothing?
No. Choose 50, 60, 70, 80, 90 or 100%. The increase applies to the deferred part.
Where do I find my expected pension?
The National Pension Service's 'My Pension' lookup shows the expected basic pension. Enter that monthly figure in the calculator.
Results are estimates based on the inputs and on the rules as at the stated date. They may differ from a lender's actual assessment, and the rules change often. Take professional advice before any decision that matters.