Retirees Forced to Work Due to Insufficient Pensions

Le Thi Thu, aged 66 and residing in Bac Tu Liem district, Hanoi, retired early in 1991 due to health complications after decades in the food sector. Following several adjustments in pension policies, her pension will rise to VND2.5 million on July 1, 2024.

“Even with the raises, my pension isn’t sufficient for my husband and me to manage everyday costs, particularly with frequent visits to the hospital for joint pain. We can’t seek employment, so we depend on our children for support,” Thu shared.

Le Van Hung, 65, from Thanh Hoa City, served nearly two decades in the navy. After developing a herniated disc in 2000, he was deemed to have lost 61 percent of his health and began receiving disability benefits for his service. His initial pension was a mere VND170,000 monthly, but after over 20 years, this has grown to VND4.6 million a month.

Yet, this amount is still inadequate for a secure retirement. Faced with almost VND100 million in debt from home repairs incurred in 2023, both Hung and his wife took on additional jobs. He works as a security guard in HCM City, while she provides housekeeping services in Thanh Hoa City.

“We have no option but to live apart. Our pension does not sustain us, and our children are also financially burdened, leaving us no choice but to rely solely on ourselves,” Hung remarked.

Across the country, around 3.4 million individuals are receiving monthly pensions and social insurance benefits. The average monthly pension in 2024 was about VND6.2 million, but disparities exist among different groups.

Those who retired before 1995 or had brief social insurance contribution periods often receive below VND3 million monthly, at times even less than the regional minimum wage. Over the years, there have been 21-26 pension increases since 1995, yet significant disparities between different retiree cohorts remain, presenting ongoing challenges.

The disparity between individuals who retire at the standard age and those who retire early is well documented. Early retirees tend to receive lower pensions due to shorter contribution periods or lower contributions overall. Many of the elderly now find themselves with pensions that fail to meet the minimum living standards.

Bui Sy Loi, former Deputy Chair of the National Assembly’s Social Affairs Committee, highlighted that pensions are based on one’s contributions to social insurance throughout their career, leading to notable differences among various retiree groups.

Individuals retiring before 1993 often find themselves with low pensions due to the policies and contribution rates prevailing at the time. The government has incrementally raised pensions for this demographic to safeguard their wellbeing and to maintain living standards.

Loi argued that this trend must accelerate, particularly for low-pension groups, to guarantee a basic living standard, enhance life quality, and ensure equitable access to social services.

“New policies that implement bold adjustments for those with very low pensions are essential to bridge gaps and uphold social justice. This aligns with the compassionate spirit of social welfare policies for those who contributed during the nation’s challenging periods,” Loi emphasized.

Echoing this sentiment, a labor expert called for pension reforms that “compensate” rather than merely counteract inflation. “We need more compassionate policies for individuals who dedicated their lives to national development, especially vulnerable workers, early retirees, or those who retired under restrictive conditions. Otherwise, increasing costs of living will make their situation even tougher,” the expert cautioned.

In the first four months of 2025, over 27,000 individuals processed pension settlements, nearly double the amount from the corresponding period in the previous year, representing a 95.47 percent surge, as reported by Vietnam Social Security (VSS).

The agency identified this growth as attributable to an uptick in early retirements and resignations linked to government restructuring policies as mandated by Decrees 177 and 178/2024/ND-CP.

By May 2025, around 19.56 million individuals were enrolled in social insurance, with 15.7 million in unemployment insurance, and 93.56 million in health insurance. Significantly, the number of individuals opting for one-time social insurance withdrawals plummeted to over 91,000, marking an 18.8 percent reduction from the previous year.

This encouraging trend indicates that workers are becoming increasingly aware of the long-term advantages of maintaining social insurance for a minimum of 15 years, as outlined in the 2024 Social Insurance Law, reflecting the law’s influence even before its official implementation.