The benefit provisions in Article 8 apply to old-age and survivors benefits under the Hungarian social security system.  For disability benefits under the Hungarian social security system, please see Article 9.

Hungary pays social security benefits to workers who meet the applicable eligibility standards, including minimum length‑of‑coverage and other requirements.  Under Article 8, Hungary will add a person’s U.S. coverage to his or her Hungarian coverage, if necessary, to meet eligibility rules.  If the person meets the requirements based on combined U.S. and Hungarian credits, Hungary will pay a partial benefit proportional to the amount of coverage credited under the Hungarian system.

HUNGARIAN RETIREMENT AND SURVIVORS BENEFITS

In 1997, reform laws created a two-pillar social security program, replacing the traditional pay-as-you-go (PAYG) defined benefit system then in place.  Starting in January 1998, the new program consists of two main social security systems: a first pillar unfunded PAYG contributory system, and a second pillar fully funded individual account Mandatory Pension Fund (MPF) system.  Under the new rules, all workers new to the workforce or age 42 or younger had to participate in both systems.  Workers older than age 42 on June 30, 1998, and those having Hungarian coverage before that date, could choose whether to contribute only to the PAYG system or contribute to both.  However, on December 13, 2010, the Hungarian Parliament passed a law moving workers out of the MPF and transferring their entire account balances to the PAYG pension system.  Workers could choose through January 31, 2011 to remain in the MPF. 
Retirement Benefits

Hungarian retirement benefits are payable at normal retirement age to workers who have at least 15 years of coverage.  Normal retirement age is currently set at age 62, but began gradually increasing from 62 to 65 in steps of six months per year beginning in 2014.

Survivors Benefits

For survivors benefits to be payable, the deceased worker must have met the coverage requirements for entitlement to either a retirement or disability benefit at the time of death.  Hungary reduces the survivor benefits of a beneficiary who is also entitled to social security benefits on his or her own.

A surviving spouse may generally receive benefits for one year.  After the first year, Hungary only pays benefits to a surviving spouse who is retired, disabled, or caring for two or more children.  Surviving minor children are eligible if they were dependent on the worker at the time of death.  A surviving cohabitant seeking to qualify must have lived with the worker 10 years without interruption, or must have lived with the worker 1 year without interruption and have in care a child of the worker.  Divorced survivors and surviving cohabitants qualify for benefits on the account of the deceased only if they received maintenance from the worker until his or her death, or if a court ordered such maintenance.

An orphan’s benefit is paid to children under the age of 16 or until they complete full-time education up to the age of 25.  Surviving parents and grandparents who were dependent on the deceased worker may also receive benefits under certain circumstances. 

Cost of Living Adjustments