SSS will establish a Provident Fund this 2013 for all members aged below 55, with a maximum SSS contribution of 1,560 under the present situation (15,000 is the current maximum MSC, with a rate of 104 pesos/1000 MSC. If the SSS proposal gets approved, this will change to Maximum MSC 20,000, with 110/1000).
Maximum contribution to the Provident Fund is 100,000 per year, with a minimum contribution of 1,000 per year, and payments can increase/decrease in multiples of 100. Payments to the Provident Fund, like the OFW Flexifund must be over and above the maximum contribution to the SSS.
The funds will be earmarked as 65% for retirement, 25% for medical, and 10% personal. Withdrawals within the 5-year retention period will be subject to charges and penalties. why, you ask? because it defeats the purpose.
Interest will be computed on this basis:
retirement and disability portion (65%) - guaranteed earnings based on the 5-year Treasury bond rate
the remaining 35% will be guaranteed earnings based on the 364-day Treasury bill rate
Retirees may opt to withdraw the savings in full or as a monthly pension.
This will work similarly to the PERA (Personal Equity and Retirement Account), only SSS Style. As you can see limitations are similar, although SSS cannot make the promise of tax benefits - only the Government can do that.
well, i recommend that non-financial savvy persons got for this. Actually, even if you are financially savvy, it would be nice to have something like this that does not require constant monitoring - makes for a less stressful life.
remember, climate change is real and you need real savings for the future. why climate change? you may need upgrades to your home because of environmental changes by the time you are retired so this might be a little (emphasis on the little) nest egg you can use.
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