Did You Know You Need to Pay for Pension If You’re Working in Japan?

Yes, it's worth investing in your pension!

Enrolling in a pension system might not be the norm in your home country, but for foreigners working and living in Japan, it’s another obligation that must be observed. The thought of pension may come off as a burden to some, but there are many benefits that come from paying pension. Another good thing is, you don’t have to pay until you retire to reap its benefits. Think of it as an investment instead.

The Japanese public pension system is based on a structure supported by the whole society in order to make many benefits available for many years to come. There are two keywords regarding pension you will usually encounter when living in Japan: the National Pension (
kokumin nenkin) and the Employees’ Pension Insurance (kousei nenkin).

People who are enrolled generally fall into three categories.

Category I
is for those who are self-employed or work in agriculture or fishery, etc., where they apply themselves at the municipal government office.

Category II
is for those who are working for a company. They are part of an Employees’ Pension Insurance or Mutual Aid associations who don’t need to pay for the National Pension Premium. The application for this is also done by the employer and the premium is deducted from their salaries.

Category III
is for spouses that are supported by the person who joined the Employees’ Pension Insurance or Mutual Aid associations.

There are many benefits you can get from the pension system of Japan whichever Category you fall into. One is the
Old-Age Basic Pension, this is the benefit that everyone is most familiar with. While the prerequisites are different for those who are under the Employees’ Pension Insurance from those who are not, people who have paid premiums for the period of coverage required for entitlement (10 years or more) will start receiving benefits when they turn 65 years old. Another benefit is the Disability Basic Pension in which you are eligible to receive benefits when you get sick or injured during the coverage period. Lastly, Survivor’s Basic Pension is provided when the insured person dies—family members will receive this benefit (the type of benefit to be given depends on the situation and the category the insured person falls into)

It may be difficult to assume that you will be staying in Japan until you’re 65, but don’t fret, because if you decide to go back to your home country without completing the required minimum of 10 years, Japan Pension Service allows you to receive a Lump-sum Withdrawal Payment as long as you have six months or more of coverage period. Details can be found


Source: Japan Pension Service Website

 (22 April 2019)

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