Is there a pension penalty for late-career family caregiving in Germany? The role of pension care credits and employment career.

Unpaid care for ill, disabled, or frail older family members (hereafter 'family care') is most common in late career. Because caregiving can be difficult to reconcile with paid work, it may reduce pension contribution records and later-life financial well-being. Many European countries therefore provide pension care credits, yet eligibility is selective and many caregivers remain uncredited. Against this background, we examine how late-career pension accumulation differs between non-caregivers, credited caregivers, and uncredited caregivers across different late-career employment trajectories. Detailed information on pensions, family care and employment of individuals between the ages of 55 and 65 (N = 814), covering those born between 1946 and 1955, is derived from SOEP-RV, a novel data linkage of administrative records of the German pension insurance (RV) with the German Socio-Economic Panel (SOEP, waves 2001-2020). By means of linear regressions, preceded by sequence and cluster analyses to typify late-career employment trajectories, we found no statistically significant associations between uncredited low-intensity care and lower pension accumulation. Uncredited high-intensity caregivers accumulate fewer pension entitlements within full-time and part-time trajectories. Moreover, credited caregivers accumulate more pension entitlements than non-caregivers, but only within part-time, homemaking, and early retirement trajectories. These findings suggest that the German pension care credit scheme provides selective and uneven compensation and that uncredited high-intensity caregivers tend to face pension penalties.