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Insurance and pension policies will undergo significant changes from July 2025, affecting tens of millions of workers in Vietnam. The amended Social Insurance Law will take effect on July 1, 2025, with major changes such as:
Restricting Lump-Sum Social Insurance Withdrawals
Starting from July 1, 2025, new social insurance participants will not be allowed to withdraw their insurance in a lump sum, except in special cases such as reaching retirement age but having less than 15 years of social insurance contributions, emigrating abroad, having a severe illness, or suffering a work capacity decrease of 81% or more. Participants who joined before July 1, 2025, and have less than 20 years of contributions can still withdraw after 12 months of unemployment if requested.
Reducing the Number of Contribution Years from 20 to 15
Participants who have contributed to social insurance for 15 years and reached retirement age will be eligible for a pension. The retirement age will be 61 years and 3 months for men and 56 years and 8 months for women at the time the law takes effect, gradually increasing as previously announced. The retirement age for women will increase by 3 months each year and for men by 4 months each year until reaching 62 for men in 2028 and 60 for women in 2035.
Adjusting the Pension Benefit Rate for Men
Men who have contributed to social insurance for 15 to 20 years will receive 40% of the average monthly wage used for social insurance contributions, with an additional 1% for each subsequent year. From the 20th year onwards, the benefit rate will be 45%, increasing by 2% each year until it reaches a maximum of 75%. Previously, the pension benefit rate for men was significantly lower than that for women, with a difference of up to 11.25%. This disparity will be reduced to 5% from July 1, 2025, while the contribution period from 15 to 20 years for men will only increase by 1% each year.
Changing the Wage Basis for Social Insurance Contributions
The wage basis for social insurance contributions for employees in enterprises will include the salary according to the job or title, salary allowances, and other additional amounts. The minimum compulsory social insurance contribution will be VND 2.34 million, and the maximum will be VND 46.8 million per month, as the minimum wage base for compulsory social insurance contributions must not be lower than the base salary, and the maximum contribution must not exceed 20 times the base salary.
Adding a Pension Layer
A new social welfare layer is introduced for people aged 75 and older who do not receive a pension, and for elderly social insurance beneficiaries aged 70 to 75 who belong to poor or near-poor households. Benefits include social pension allowances, funeral cost support, and health insurance from the state budget. The initial level is expected to be VND 500,000, with adjustments every three years. This change is expected to add 700,000 more people to the policy coverage.
Expanding Compulsory Social Insurance Coverage
The expanded coverage includes part-time workers earning a monthly salary equal to or higher than the reference level, registered household business owners, unpaid business managers, and voluntary social insurance participants with additional maternity benefits, occupational accident insurance, unemployment insurance, and supplementary pension insurance.
This amendment aims to retain workers within the social safety net and reduce the incidence of lump-sum social insurance withdrawals, supporting a multi-layered social insurance system from the start of employment until the end of working life.
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