State Pension Plan

The retirement benefit is a cash benefit paid to a member who can no longer work due to old age. The retirement benefit can be paid through:

• Monthly pension - a lifetime cash benefit paid to a retiree who has paid at least 120 monthly contributions to the SSS (Social Security System) before the semester of retirement. The monthly pension depends on the member's paid contributions, credited years of service and the number of dependent minor children (must not exceed five).
• Lump sum amount - granted to a retiree who has not paid the required 120 monthly contributions to the SSS before the semester of retirement. The lump sum amount is equal to the total contributions paid by the member and by the employer including interest.

Eligibility

A member is qualified to avail of this benefit if:

• Member is 60 years old, separated from employment or ceased to be self-employed, and has paid at least 120 monthly contributions before the semester of retirement
• Member is 65 years old, whether employed or not, and has paid at least 120 monthly contributions before the semester of retirement

Other Benefits

• The legitimate, legally adopted and illegitimate children conceived on or before the date of retirement of a retiree shall be entitled to receive dependent's allowance. The allowance is equivalent to 10% of the retiree's monthly pension or PHP 250, whichever is higher. Only five minor children, beginning from the youngest, are entitled to the allowance. The dependent's allowance stops when the child reaches 21 years old, gets married, gets employed or dies. However, the dependent's allowance is granted for life for children who are over 21 years old and who are incapacitated or incapable of self-support due to physical or mental disability that is congenital or acquired during minority.
• The retiree is entitled to a 13^th month pension payable every December.

How to Apply

Applications for retirement benefit are filed at any SSS office or branch. Application requirements and a how-to video for detailed application instructions can be found here.

For more information on the retirement benefit, go to this link.

Company Pension Plan

The type of company pension plan usually depends on what the company offers. Not all companies offer a company pension plan. Companies that do offer a salary related scheme where the amount you'll receive upon retirement is based on your salary and the number of years you have been with the company.

Claiming Your Pension

When and how you can claim your pension depends on the company. This will be outlined in the scheme's rules which should be part of your employment contract. However, a forecast of how much you will receive when you retire, estimates of any beneficiary's benefits that may become payable, and how much you will get if you have to retire early due to ill health should be readily available.

Personal Pension Plan

Setting up a personal pension plan to supplement the income you receive from a state pension is a great investment for your future. Anyone can set up a personal pension plan, whether they are employed, self-employed or not working. Private pensions are available from banks and life insurance companies. Once it is established, you can control how much money you pay into it. Different providers have different plans depending on your retirement needs. It is best to determine your needs and check your options to find a plan that suits you.

A personal pension plan is best for:

• Self-employed individuals
• People who are not working but could afford to pay for a pension
• Employees with employers not offering a company pension scheme
• Employees on a moderate income who wish to top up the money they would get from a company pension or state pension

Eligibility

The earliest age at which you can take your personal pension is 50. It is common to wait until age 60 or 65 and take this money out in tandem with the state pension.

Benefits

A yearly forecast informs investors of the status of the fund. It also lets you know the expected pay-out if contributions remain the same. The final value will be determined by how much has been paid in and how well the fund has performed. Charges of running the fund will also be deducted.

Expat Pension Plans

A few countries have a bilateral agreement with the Philippines that allow for years worked in the Philippines to count to their state pension. Inquire with your state plan about the particulars.

If your country does not allow for years worked in the Philippines to count toward your state pension, there may be an opportunity to buy back time once you have returned to your home country and are once again contributing to the pension plan. Again, inquire with your state plan about the particulars.

Making Contributions while Abroad

If you're working abroad, you may be able to pay into the state pension scheme of the country where you're working. Depending on how long you work abroad, you can have your contributions credited to your state pension or you could receive two pensions - one from your home country and one from the country where you lived and worked. This will be decided when you reach state pension age, taking into account where you live.

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