Your retirement options

MANILA, Philippines – The thought of putting aside something for retirement is probably the last thing that people in their twenties, thirties, and maybe even forties have on their mind. For those who are new to the work force and to the pay slip that comes every fortnight, spending just gives too much joy. There’s the newest iPhone you just have to get, the latest Transformers movie you have to see on the big screen, and Starbucks’ latest flavor that you just have to taste. But years from now, retirement would be a reality, or at least you would want it to be. There are those after all who think that retirement in the Philippines doesn’t exist since one cannot afford it. Then there are those like retired top advertising executive Gil Yuzon, who used retirement to get the most out of life—by getting into motorcycles at that age, and by doing the things he’s always wanted to do!

We believe that it’s never too late to begin saving now, getting into reasonably-priced and well thought out investment plans, for you to still cinch that dream retirement.  

Inquire about your company’s retirement plans. The basic plan is that you are supposed to have your last salary multiplied by the number of years you have served the company. Inquire with your company’s Human Resources and make sure that you are getting what you are due.

For Filipinos abroad and foreigners looking into retirement in the Philippines, consider packages such as those of the Philippine Retirement Authority. The PRA’s thrust is to spread the word that the country is a quality place where our balikbayans, OFWs and even foreigners can consider retiring. The PRA has good packages to offer. Holders of the Special Resident Retiree’s Visa can live, work and study in the Philippines; are exempted from income tax, as well as the re-entry and exit permits of the BIR. For more information, go to www.pra.gov.ph. One more tip: OFWs thinking of investing in the Philippines for their retirement could invest in their country, get what they’ve accumulated and convert it into pesos when they get back to the country, or just directly invest in the Philippines when they get here.

Look into life preparation and financial planning programs. Purchasing a life insurance policy is more than just a safety net for your family but it can boost your retirement income as well. Insurance companies such as Paramount Life & General Insurance offers traditional products that focus on pure life coverage and non-traditional products, which blend life insurance with investment opportunities. Then there are financial companies like Sun Life Financial that offer packages with an investment component that accumulates over time and can be used as a retirement fund.

Look into government packages. Government employees who have retired should have no problem because of what they can get from the GSIS. The latter has recently removed the ceiling on their pension benefits. With this new policy, GSIS members may be entitled to 37.5 percent up to 90 percent of their average monthly compensation as their monthly pension. The average monthly compensation is based on the member’s salary during the last 36 months in government service prior to retirement. The retirement benefits give retiring members who have at least 15 years of service with corresponding premiums paid, a pension equivalent to 37.5% of his AMC plus P700.

Look into real estate. Not just for balikbayans, investing in property is also a good way of making your money grow, especially now with the low interest rates of banks. Condominiums, house plans and the like are good ways of investing. Currently, there is a growing consciousness in the market to invest in concrete assets to fight inflation. There is a perception that because bank rates are very low, people think that investing in property or other forms of fixed assets might go up in value due to inflation, than put their money in the bank, thus making it a wiser and safer form of investment. Office space rentals, tourism and infrastructure have also gone up in terms of growth. Right now, there are more housing and condominium options where you can put your money in, as well as affordable house packages so investing is a good option.