Agirc-Arrco: Understanding supplementary retirement for private sector employees

In summary

The Agirc-Arrco retirement is a mandatory supplementary pension scheme for private sector employees. It operates on a points system, enabling an additional pension on top of Social Security benefits. Since the 2019 merger of Agirc and Arrco, it covers all employees, both executives and non-executives. Discover how it works, contributions, pension calculations, and recent developments.

🏛️ What is the Agirc-Arrco?

The Agirc-Arrco scheme is a mandatory supplementary retirement system for private sector employees. It allows for an additional pension beyond the basic retirement paid by Social Security.

🔄 A merger for a unified scheme

Until January 1, 2019, there were two separate schemes:

• Agirc (General Association of Executive Retirement Institutions), which only covered managers and offered a specific supplementary retirement.
• Arrco (Association for the Supplementary Retirement Scheme for Employees), which covered all employees, including workers, clerks, technicians, supervisors, and managers.

The merger of these two schemes in 2019 created a single, simplified system, providing the same rights and rules for all private sector employees. This development allowed:

✅ Better clarity of acquired rights.
✅ Simplified pension calculation.
✅ Pooling of resources to ensure scheme sustainability.

📜 A scheme managed by social partners

Agirc-Arrco is managed by social partners (trade unions and employer organizations), who make strategic decisions to ensure the financial balance of the scheme.

Every year, they determine notably:

📌 The value of the retirement point used to calculate pensions.
📌 Contribution rates applied to active workers’ salaries.
📌 Potential revalorization to follow inflation and living costs.

💡 A scheme based on solidarity

The Agirc-Arrco system is based on a pay-as-you-go principle:

🔹 Active workers’ contributions directly fund retirees’ pensions.
🔹 This model ensures intergenerational solidarity, where each generation contributes to the previous one’s retirement.

With nearly 13 million retirees and over 18 million contributors, Agirc-Arrco is a key pillar of the French retirement system, ensuring private sector workers have an additional income after their career.

📌 How does the supplementary retirement work?

The Agirc-Arrco scheme relies on a points system, where each contribution paid by a worker allows accumulation of rights for their future pension. Unlike the basic retirement, which is calculated in quarters, this scheme operates with an accumulated points mechanism throughout the career.

🔄 A points system for calculating the pension

Each private sector employee contributes to the Agirc-Arrco scheme through deductions from their gross salary. These contributions are converted into points, which are then used to determine the pension amount.

The calculation is based on three key elements:

1️⃣ Contribution base: it’s the gross salary subject to Agirc-Arrco contributions.
2️⃣ Points acquisition rate: it determines the number of points earned per euro contributed.
3️⃣ Point value: it is set annually and is used to convert points into euros at retirement.

📊 Summary table of principles

📈 How does the point value evolve?

The final pension amount depends on the number of accumulated points and the point value at retirement. This value is regularly adjusted to account for inflation and economic conditions.

📌 Calculation example:
If a retiree accumulates 25,000 points and the point value is set at €1.4156, then their gross annual pension will be:

25,000 × 1.4156 = €35,390 per year
Or €2,949 per month before social deductions.

🧐 A scheme managed by social partners

The Agirc-Arrco is jointly managed by trade unions and employer organizations. Their mission is to ensure the scheme’s balance, by adjusting contributions, the point value, and revalorization methods.

Thanks to this management model, Agirc-Arrco guarantees a stable supplementary pension, which adapts to demographic and economic changes. 🚀

👥 Who contributes to Agirc-Arrco?

All private sector employees, whether managers or non-managers, are automatically affiliated with the Agirc-Arrco scheme. This affiliation guarantees the acquisition of rights to supplementary retirement, which will add to the basic pension provided by Social Security.

📌 Automatic and mandatory contribution

Contributions to Agirc-Arrco are deducted directly from the gross salary of the employee. They are mandatory and shared between the employer and employee, based on a set rate.

💡 The employer covers approximately 60% of contributions, while the employee contributes about 40%.

💰 Which income is subject to contributions?

The contribution basis consists of the gross salary of the employee, up to a limit of eight times the Social Security ceiling (PASS).

Contributions are divided into two brackets:

• Bracket 1: up to a monthly Social Security ceiling (PMSS), which is €3,864 in 2024.
• Bracket 2: between 1 and 8 times the ceiling (from €3,864 to €30,912).

📊 Contribution rates for Agirc-Arrco

🏛️ A pay-as-you-go scheme

The Agirc-Arrco system is based on a principle of intergenerational solidarity:

🔹 Active workers’ contributions directly finance retirees’ pensions.
🔹 Each worker accrues retirement points, which will be converted into additional pension upon retirement.
🔹 The system is managed by social partners, who adjust contribution rates and point value to guarantee financial balance of the scheme.

Thanks to this funding model, Agirc-Arrco ensures a sustainable supplementary pension, while preserving rights for future generations. ✅

🏦 How is the pension calculated?

The amount of the Agirc-Arrco supplementary pension is based on a points system, where each contribution paid allows the accumulation of retirement points. At retirement, these points are converted into euros depending on the current point value.

📊 Steps to calculate the pension

1️⃣ Accumulation of points 💰

• Each month, a part of the gross salary is deducted as contributions to Agirc-Arrco.
• These contributions are converted into retirement points, which are added to the employee’s personal account.

2️⃣ Evolution of the point value 🔄

• Each year, the value of the Agirc-Arrco point is readjusted based on inflation and economic conditions.
• This revalorization allows to adjust pensions to costs of living.

3️⃣ Conversion into pension at retirement 📅

• At retirement age, the total number of points accumulated is multiplied by the current point value.

📌 Summary table of influencing factors for the pension

📈 Example of calculation

If an employee has 25,000 Agirc-Arrco points and the point value is €1.4156, then the annual gross amount of their supplementary pension will be:

👉 25,000 × 1.4156 = €35,390 per year
or €2,949 per month before social deductions.

📉 Reduction and addition

The legal age to obtain a full pension is set at 67 years, unless the insured meets the conditions for a full rate starting at 62 years.

• Early departure before 67 years ❌: A reduction of 5% per year may be applied.
• Departure after 67 years ✅: A temporary bonus of 10 to 30% is granted for a duration of 1 to 3 years depending on the actual age at departure.

Thanks to its transparent calculation method, Agirc-Arrco guarantees a stable supplementary pension, adapted to private sector workers. 🚀

📅 What is the retirement age for Agirc-Arrco?

The Agirc-Arrco scheme follows the general rules of the retirement system in France, with a minimum retirement age of 62. However, the amount of supplementary pension depends on several factors, notably the number of validated quarters and the actual retirement age.

🔹 The legal age and full-rate age

⚠️ Temporary Agirc-Arrco penalty

Since 2019, a temporary solidarity coefficient (penalty) applies to supplementary retirements if the departure occurs at age 62 and the pension is not deferred by at least one year.

📌 How does this penalty work?

• It results in a 10% reduction on the additional pension for 3 years.
• It does not apply if the insured defers their departure by at least one year after reaching the full rate.
• Exemptions exist for low-income retirees and beneficiaries of certain specific schemes (e.g., long careers).

✅ Bonus for deferred departure

Conversely, a temporary bonus is granted to those who postpone their departure by at least two years after the full rate age.

🎯 How to choose the right age to retire?

The choice of departure age depends on several factors:
✔️ Number of validated quarters to reach the full rate.
✔️ Impact of the penalty and potential tax advantages related to postponement.
✔️ Financial needs and personal projects at retirement.

By anticipating these criteria, each worker can optimize their pension and benefit from the best conditions for their retirement departure. 🚀

📉 Why could your supplementary retirement evolve?

The amount of the Agirc-Arrco pension received by private retirees may vary each year due to updates in social contributions. One of the main factors influencing this evolution is the Generalized Social Contribution rate (CSG), which is revalued annually based on the declared taxable income (RFR).

In March 2025, some retirees will see their pension increase, while others could experience a decrease, due to changes in their CSG rate applied to their supplementary pension.

📊 What happens if your CSG rate decreases?

If your taxable income has decreased in 2023 (declared in 2024), your CSG could be reduced in 2025. A decrease in the CSG rate means the social deduction will be lower, which will lead to an increase in your net pension amount.

✅ Immediate effect: Starting from March 2025, your pension will increase automatically.
✅ Regularization: A refund of overpaid contributions for January and February will be made to your account.

📉 What if your CSG rate increases?

If your taxable income has risen in 2023, your CSG rate will be reassessed upwards in 2025. This will lead to an increase in social deductions, thus reducing the net amount of your supplementary pension.

⚠️ Immediate effect: Your net pension will decrease in March due to the higher CSG deduction.
⚠️ Retroactive adjustment: The amount deducted in March will also include the adjustment for January and February, potentially increasing the temporary decrease of your pension.

📌 How to anticipate these changes?

📍 Regularly check your taxable income (RFR) to anticipate possible changes in your CSG rate.
📍 Visit your Agirc-Arrco personal space to monitor the evolution of your net pension after March 2025.
📍 In case of a significant pension decrease, it is recommended to contact an Agirc-Arrco advisor to better understand the impact of deductions.

Thanks to these annual adjustments, Agirc-Arrco guarantees an adaptation of pensions to economic and fiscal conditions, while maintaining a balanced and sustainable retirement system. 🚀

📊 Summary table of new CSG thresholds

The Generalized Social Contribution (CSG) rate applied to retirement pensions depends on the taxable income (RFR) of the retiree and the number of tax shares of the household. Each year, these thresholds are reassessed based on inflation.

Here are the new applicable thresholds for 2025:

📌 Useful info

✅ Annual revaluation: These thresholds were raised by 4.8% in 2025 to follow inflation.
✅ Progressive CSG: The more the taxable income increases, the higher the applied contribution rate to the pension.

✅ Exemption cases: Retirees with a lower RFR than the exemption threshold benefit from a pension without CSG.

🔹 Impact on retirees: Variations in income can alter the applied CSG rate and thus change the net pension amount received. It is therefore recommended to check your tax income annually to anticipate these changes. 🚀

🏁 Why is the Agirc-Arrco essential?

The Agirc-Arrco scheme plays a fundamental role in the French retirement system, ensuring millions of private sector employees have a supplementary pension to add to their basic retirement. Thanks to its solidarity-based operating mode, it helps ensure financial balance between generations, while offering support services to retirees.

🌟 Advantages of the supplementary scheme

📌 Financial security 💰
The Agirc-Arrco guarantees private sector employees a stable supplementary pension, which helps maintain a more comfortable standard of living after finishing their career. Unlike the basic retirement, which is based on a quarters system, supplementary retirement relies on a points system, ensuring greater transparency and clarity of the rights acquired.

📌 Intergenerational stability 🔄
The distribution principle of Agirc-Arrco is based on a solidarity between generations:

• Contributions from active workers are directly used to fund current retirees’ pensions.
• This model guarantees the system’s sustainability without overburdening younger generations.

📌 Personalized support 🏡
Beyond pension payments, Agirc-Arrco offers a range of services to support retirees and working individuals nearing retirement. These include:
✔️ Workshops and conferences to better prepare for retirement.
✔️ Social support programs for those in fragile situations.
✔️ Health prevention programs aimed at seniors.

Thanks to this dual mission— guaranteeing a stable supplementary pension and offering comprehensive support services— the Agirc-Arrco is a key player in the French retirement system, providing security and peace of mind to retirees. 🚀

🔎 The importance of the supplementary retirement in the French system

In France, the retirement system rests on three pillars:

1️⃣ Basic retirement: paid by Social Security, it is calculated based on the number of contributed quarters and the average income of the best years of work.
2️⃣ Supplementary retirement: Agirc-Arrco, which operates with a points system, allows increasing the pension amount.
3️⃣ Individual retirement savings: optional, including products like the Retirement Savings Plan (PER), which allows workers to save for their future retirement.

💡 Why is supplementary retirement essential?

• Basic retirement often does not maintain a comfortable living standard in retirement.
• The Agirc-Arrco system allows adding an additional income, proportional to contributions made throughout the career.
• Thanks to the pay-as-you-go principle, active workers directly fund retirees’ pensions, ensuring intergenerational solidarity.

📊 Evolution of the Agirc-Arrco scheme over the years

The Agirc-Arrco system has undergone several major reforms to adapt to economic and demographic changes.

📅 Key dates of the scheme’s evolution:

🔹 Why these reforms?

• 📈 Rising life expectancy increases the number of retirees.
• 📉 Fewer contributing active workers to finance pensions.
• 🏦 Need to balance the system to avoid chronic deficits.

📢 The latest news and reforms of Agirc-Arrco

Every year, adjustments are made to ensure the financial stability of the scheme.

📌 Recent changes (2025):
✅ Revalorization of point value: increased by 4.8% to follow inflation.
✅ Changes in contribution rates: slight increase for some high-income workers.
✅ Update of CSG thresholds: directly impacting the net pension amount.
✅ Simplified online procedures through a secure portal.

💡 Key takeaways:

• Agirc-Arrco pensions are linked to inflation, but may fluctuate depending on government decisions.
• Checking your personal account allows you to anticipate these changes and adjust your retirement strategy.

💡 Options to optimize your supplementary pension

📌 How to improve your Agirc-Arrco pension amount?

1️⃣ Buy back points: it’s possible to buy back quarters or points to compensate for periods without contributions.
2️⃣ Work longer: each additional year after 62 years helps avoid a reduction and may grant a temporary supplement.
3️⃣ Check your career statement: identify possible errors and request a correction if needed.
4️⃣ Use retirement simulators: anticipate the amount of your future pension to make necessary adjustments.

🔹 Optimization example:
An employee who defers their departure by 3 years beyond the full rate age can obtain a 20% bonus on their pension for one year!

🛠️ Administrative procedures for claiming your supplementary retirement

📌 How to request your Agirc-Arrco retirement?

1️⃣ Create an account on the official website of Agirc-Arrco.
2️⃣ Make a simulation of your pension amount.
3️⃣ Fill out the online application (possible up to 6 months before the desired departure date).
4️⃣ Provide the required documents:

• ID card
• Career statement
• End of activity certificate
  5️⃣ Track your application online and contact a retirement advisor if needed.

💡 Recommended advice: Plan your application early to avoid payment delays.

📍 Agirc-Arrco and inflation impact: How to adapt?

📊 Inflation directly influences pension amounts.

✅ Adaptation measures implemented:

• The value of the point is reassessed annually.
• Thresholds for social deductions are adjusted to protect low pensions.
• It is possible to access aid for retirees in difficulty.

🏦 Agirc-Arrco and taxation: What you should know

💰 The supplementary pension is subject to several deductions:

• CSG (6.6% or 8.3%)
• CRDS (0.5%)
• CASA (0.3% for dependency)

📌 Possible exemptions:
🔹 Retirees with low taxable income may be exempt from CSG.
🔹 Certain fiscal deductions can help reduce the impact of deductions.

📅 What are the payment deadlines and schedule?

📌 Pension payment dates for 2025:

📍 Check your bank statement regularly to anticipate payments and quickly report any delays.

🎯 Conclusion

If you receive an Agirc-Arrco pension, your March pension may be affected by the new CSG rules. Check your taxable income and plan for potential adjustments to avoid unpleasant surprises. ✅

For further information