Author Archives: Bobet Prudente

Enjoy Your SSS Pension – P1,200 per month?

by Bobet Prudente

Note from the author: when first written, minimum pension was ₱1,200.  With an across-the-board increase of ₱1,000 in 2017, all pension amounts were increased accordingly. 

Imagine retiring, and getting a pension of ₱2,200 per month.

If you read the newspapers, you probably remember President P’Noy was in the headlines in early 2016, for vetoing a proposed law raising the pension of SSS retirees by ₱2,000 per month. He said doing so will bankrupt the SSS fund.

It was such a distressing news. SSS could not afford to raise the pension by ₱2,000?

President Duterte thought otherwise.  Under his administration, the SSS implemented a ₱1,000 per month across the board increase in early 2017 for all SSS pensioners and is set to implement a second round in 2019.  But this will reportedly bankrupt SSS by 2026 only eight years from now!

Maximum Contribution for 30 years

I computed how much I’d get as pension when I turn 60. I was a senior manager for more than 30 years, and hence paid the maximum SSS contribution for 30 years. Therefore, I expect the highest possible pension for 30 years contribution.

And the number I got was….. (drum roll please) ….. ₱ 10,900 per month!

What?

How could a highly paid employee, paying maximum contribution for 30 years, survive on ₱10,900 per month when he retires?

But that is NOT the sad part. ₱10,900 is for those who paid maximum. How about those who paid less?

What if you paid for only 10 years?

There are Filipinos who paid less, and contributed for 10 only years.

The minimum pension after paying 10 years is ₱2,200 per month!
Can you imagine living with a pension equivalent to ₱70 PER DAY?

The maximum pension after paying 10 years is ₱7,400 per month.

What if you paid for more years?

If you contributed:

  • for 10 years, your pension will be ₱2,200 – P7,400 per month.
  • for 15 years, your pension will be ₱2,200 – P7,400 per month. (same as 10 years!)
  • for 20 years, your pension will be ₱3,400 – P7,700 per month.
  • for 30 years. your pension will be ₱3,400 – P10,900 per month.
  • for 40 years, your pension will be ₱3,400 – P14,100 per month.
  • for 45 years, your pension will be ₱3,400 – P15,700 per month.
After contributing the maximum SSS premiums for 20 years, you will be eligible to a maximum pension of ₱7,700

After contributing the maximum SSS premiums for 20 years, you will be eligible to a maximum pension of ₱7,700

We must build our own retirement fund!

Obviously, we can’t depend on the government or the SSS to provide us enough during our retirement. We must take control of our future, and build our own retirement fund. Otherwise, we might be among those who will retire with a ₱2,200 pension, or if you contribute the maximum premium for 30 years, ₱10,900 per month.

Do we want to prepare for your retirement?
We must take control of our future, so we will not retire dirt-poor.

Would you like to attend our free 1-hour “Building Your Future – Controlling Your Money” seminar in various locations, to get financial education?

After attending the Building Your Future seminar, you can attend workshops 1 to 4 at the
World Centre for FREE.

The third workshop is particularly interesting if you are planning to build your retirement fund.

Workshop #3. Building Wealth. Asset Accumulation.

  • Wealth Formula.
  • The Hidden Cost of Waiting.
  • The Rule of 72. Understanding Interest.
  • Peso Cost Averaging.
  • Mutual Funds.
  • Passive vs. Active Management.
  • Saving for your Children’s Education.

Plan to retire rich and retire happy!

p.s.
Learn the  “The Secret to Saving and Building Your Future.”  Click here to learn how.

p.s.  #2
Get a  free eBook “The Secret to Saving and Building Your Future.”  Click here to download it.

p.s. # 3
My wife Mary Ann and I conduct the “Building Your Future” financial seminars on Mondays at 2pm and 6pm in Quezon City.  Click here to register for our FREE seminar.

 

Take Charge of Your Children’s Future!

By Bobet Prudente

I remember 39 years ago, when I first enrolled at the University of the Philippines in Diliman, Quezon City. I was a full scholar and didn’t have to pay for tuition fee, but we were still assessed. And our typical assessment was about P300 tuition and fees for the entire semester. Not P300 per unit, it was about P300 for the entire semester.

UP Diliman

The Oblation at the University of the Phillipines in Diliman, Quezon City.
By Rinangel Buenavente, Crispin Sta. Ines [Public domain or Public domain], via Wikimedia Commons

Last January, my youngest son enrolled in the same campus at UP Diliman, and his tuition and other fees totalled P30,000. And I think UP has not increased tuition fees for at least 5 years.

Let us do the math.
* P300 x 10 = P3,000
* P300 x 100 = P30,000

In my lifetime, in 39 years, the tuition fee in my school increased 100 times, or about a compounded rate of 12.5% every year.

How much would YOU pay for YOUR children’s college education?

Most of you will be sending kids to college in less than 15 years, so maybe you will not pay 100x, but perhaps 8x to 10x what YOU paid when you were in college?

I talked to a seminar attendee a few weeks ago, and asked him how much he paid in college. He said, P15,000 tuition fee per semester.

Let us do the math again:

  • in 15 years, maybe tuition will increase only eight times.
  • P15,000 x 8 = P90,000 in one semester
  • P90,000 x 8 semesters = P720,000

And that is just for tuition. How about other school fees, transportation, allowance?
Let us say you spend another P280,000, and the cost of sending one child to college is P1,000,000.

If the basis is P30,000 (like what I paid in UP Diliman), the cost of sending one child to college in 15 years, will probably be P2,000,000

If you have two children, that is P2,000,000 to P4,000,000 you’ll be spending in 15 years.  Are you preparing to send your children to college?

Are you saving and investing so you’ll have an extra two to four million pesos in 15 years?  Are you saving enough, so you’ll have some money left over for your retirement?

Would you like learn ways to increase your cashflow, save and invest, so that you can send your children to college?

IMG launched a new seminar “Building Your Future” in January 2016 to help Filipino families achieve financial freedom through financial education, saving and investing. Our goal is to have 1 million financially educated families by 2020 ( hashtag #1M2020 )

Would you like to attend our free 1-hour “Building Your Future – Controlling Your Money” seminar in various locations, to get financial education?

Would you like to take charge of your children’s future?

#1M2020