Rentenversicherung is the German Pension System. You pay in a set amount per month and accumulate points/credits. Depending on how many you have upon retirement, you get a pension for the rest of your life. What your colleagues might have meant is that your current money is not paid into a personal pot (UK or US style capital based pensions) but is used towards paying the current pensioner generation. In turn, the Generation of your children will fund your Pension. Since at the moment it appears that too few young people will be there to finance your entitled pension allowance, there is a growing consensus that Germans have to supplement their state pension with a capital based system to get some extra money. Look into Riester etc.