Philippines: SSS boosts pension savings with 7.2% plan
‘MySSS Pension Booster’ targets OFWs, professionals: How it works
Highlights
- The MySSS Pension Booster is a new savings scheme for Filipinos.
- It offer higher returns for members who want to build a bigger nest egg, replacing WISP and WISP+, as part of agency's rebranding and boosting investments.
Manila: If you're a Filipino corporate executive, professional, seafarer, young professionals or expat who wants to build a have a bigger nest egg upon retirement, there's a new state-baked scheme worth considering.
The Social Security System (SSS) launched the MySSS Pension Booster program, offering members including overseas Filipino workers (OFWs) a chance to significantly grow their retirement funds.
Contributions start at Php500 ($8.50) per payment, in a voluntary savings scheme that supplements the regular SSS retirement benefit, the agency announced recently.
(1) Automatic enrollment for contributing members and open enrollment through My.SSS accounts with minimum contributions of 500 pesos per payment.
(2) Voluntary scheme: allows members to contribute additional amounts for an even larger retirement nest egg.
This new scheme replaces the WISP (Worker’s Investment and Savings Program (WISP) and WISP Plus offerings – and boasts a projected 7.2% annual return, exceeding the previous options.
The programme targets professionals, overseas workers, and young individuals who want to invest more for retirement. Using the Rule of 72 formula, the scheme could theoretically double your money in about 10 years.
It is a useful tool for quickly understanding the effects of compound interest.
The formula is:
Number of Years =72/Annual Rate of Return
Rebranding
SSS president and CEO Rolando Macasaet said the MySSS Pension Booster aims to cater more to corporate managers and executives, doctors, lawyers, overseas Filipino workers, expats, seafarers and young professionals who have a bigger need for retirement funds.
“We do not lose sight of the other SSS members through other programmes, but our rebranding is a move toward capturing those who want to invest more and can invest more,” Macasaet told local media.
It offers both mandatory and voluntary schemes.
Mandatory vs voluntary schemes
SSS Vice President Joy Villacorta explained that the mandatory scheme automatically enrolls SSS members who contribute to the regular program, while the voluntary scheme encourages interested SSS members to enroll in the savings plan through their My.SSS account.
The voluntary scheme can be availed for as low as 500 pesos ($8.50) per payment, with the maximum contribution amount determined by limits set by SSS collection partners. For urgent cash needs, members can withdraw their total contributions, including the earnings, as SSS allows both partial and full withdrawal of their savings.
Nonetheless, SSS encourages members to stay in the savings programme for at least five years to maximize the potential earnings on their savings.
Capital availability
A bigger savings pool helps boost capital available for investment. This capital can be used by businesses to expand operations, develop new products and services, and invest in infrastructure — upgrading transport, communication networks, and energy system, thus helping create jobs and improve overall economic efficiency.
Overdue loans
The SSS also offers loans to members. Approved loans can be checked via the My.SSS account or through the branch offices through their e-centers.
Members with unpaid loans will now be notified of late payments via SMS, helping them avoid further penalties by paying on time, it was announced on Wednesday.
The agency clarified that SSS members who consistently update their monthly loan payments will not receive SMS notices. They will also maintain good standing with the SSS, allowing them to reapply for future loans.