What is nenkin? Why should you pay your nenkin?

Surely many of you who are about to go to Japan to work abroad or are about to return home have the same question: What is Nenkin? Why need to pay Nenkin? In today’s article, we will provide you with basic information about Nenkin.

What is nenkin? Why should you pay nenkin?

Nenkin – 公的年金制度 (Kouteki nenkin seido) – is compulsory insurance that every citizen living and working in Japan must participate in. The subjects of Nenkin are people between the ages of 20 and 59, regardless of gender, occupation, or nationality. Therefore, even if you are a foreigner coming to Japan to live for a short time, you must also participate in this insurance scheme.

The reason behind paying nenkin

When Nenkin participants get old, reach retirement age, and are no longer able to work (after age 65), they will receive a pension to support their life. Provided that such person fulfills the obligation to pay Nenkin in full according to regulations. Besides the pension, before the age of 65, there will be other support benefits (such as death/ disability benefits) if you encounter unexpected incidents. 

Before 1994, the Japanese government did not have a policy for foreigners, so when foreign workers returned home before retirement age, they would not have the opportunity to receive Nenkin money back. However, after 1994, the Japanese government allowed foreign workers to receive part of this money back when they returned home.

You need to prepare some necessary documents in order to receive a part of your nenkin back

Procedures to receive back part of your nenkin

To get a part of the paid nenkin money back, you need to prepare the necessary documents and download and fill out the application form for nenkin according to the instructions of the union. Required documents include:

Copy of passport with 3 pages: personal information, status of residence and stamp of the last date of departure from Japan. 
Paper containing information about the receiving bank account (enclosed with a certification stamp from the bank) 
Nenkin handbook – if available 
Application for refund of nenkin 

After you have prepared all the necessary information and documents, you need to pack it into a parcel and send it to the Japan pension service’s address as below.

After completing the procedure of how to get the nenkin back, and send it. If there are no errors, then 3-4 months later the money will automatically be transferred to the bank account. In the event that the application for recovering nenkin is wrong or missing information, it will be returned to the person doing the procedures. 

Also, you need to be aware that you will have to split to get Nenkin twice. In the first you will get about 70% of the nenkin coins and in the second you will get another 20%. 

Hope the above article is useful for you in the process of living and working in Japan. Wishing you all good health and success.