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SSS PESO Fund vs MP2: Which is the Better Savings Program for You?

Venus Zoleta

Venus Zoleta

Last updated November 10, 2021

If there’s one important thing this pandemic has taught us, it’s to start saving for emergencies. And yes, a bank account is not the only way to set aside an emergency or savings fund. You can also start saving with the SSS PESO Fund and Pag-IBIG MP2. 

To encourage members to save and earn additional income, the Pag-IBIG Fund and SSS have their own voluntary savings schemes: the Modified Pag-IBIG II (MP2) Program, and the Personal Equity and Savings Option (PESO) Fund. Both government savings programs are attractive options for Filipinos who don’t have much to save and prefer not to invest in riskier instruments such as stocks and mutual funds.

In this article, we’ll talk about the SSS PESO Fund vs MP2 to help you make the right decision and pick the best savings program for you.

What is the SSS PESO Fund?

The SSS PESO Fund is a provident fund program offered to SSS members who want to voluntarily contribute and save more. 

The PESO Fund[1] contributions are allocated in three accounts:

  • Retirement / Disability - 65% allocation with guaranteed earnings based on 5-year T-Bond Rates
  • Medical - 25% allocation with guaranteed earnings based on 364-day T-Bill rates
  • General purposes - Composed of education, housing, livelihood, and unemployment with a 10% allocation of earnings based on 364-day T-Bill rates

What is MP2 Savings?

The Pag-IBIG MP2 is a savings facility designed for Pag-IBIG Fund members. This savings program is also open to retirees and pensioners who used to be active Pag-IBIG Fund members. 

Common Features of MP2 and SSS PESO Fund 

SSS PESO Fund vs MP2 - Common Features

Before we flesh out the differences between the two government savings schemes, let’s take a look at the features that have in common:

Open to All Regular Pag-IBIG and SSS members

Whether you’re an OFW or local worker, living abroad or anywhere in the Philippines, you can open a Pag-IBIG MP2 and/or SSS PESO Fund. Just make sure you meet all the requirements.

Optional Savings Programs

These are voluntary savings schemes, meaning members are not required to join if they don't want to. Those who want to save in Pag-IBIG MP2 or SSS PESO Fund can make payment contributions every month or pay in a lump sum. Both programs also allow you to save more if you want to earn more. 


Interests earned from savings accounts under the Pag-IBIG MP2 Program and SSS PESO Fund Program will not be subject to tax. This is a huge relief because most regular peso savings accounts with commercial banks are subject to 20% withholding tax. 

Guaranteed by the Philippine Government

There’s little to no possibility of losing your savings because these contributions are backed by government funds. 

Higher Interest Rates

Compared to savings and time deposit accounts, government savings programs from the SSS and Pag-IBIG have higher interest rates. This means you can earn twice your earnings from other regular savings accounts in a year. 

Monthly Payments Not Required

There’s no penalty for missed monthly payments. You don't need to worry about missing a payment because earnings for your account are calculated on an annual basis. 

SSS PESO Fund vs MP2 Minimum and Maximum Investments

SSS PESO Fund vs MP2 - Minimum and Maximum Investments

The Pag-IBIG MP2 and SSS PESO Fund are among the most affordable savings options in the Philippines. This makes the two savings programs ideal for millennials, non-working spouses, kasambahays, and other Filipinos who don’t have much money for saving and investing.

For as low as ₱500 monthly, you can start saving under the MP2.

The minimum monthly investment for the PESO Fund is higher yet still affordable at ₱1,000. The savings and earnings of SSS members go to three accounts: retirement/total disability (65%), medical (25%), and general-purpose (10%). The general purpose account is allocated for education, housing, and livelihood needs.

With the MP2, you can save as much as you can as it has no maximum savings amount. SSS, however, allows members to save ₱100,000 at most per year with the PESO Fund.

Back to the main article: Investments for Beginners: How to Find the Right Investment for You

SSS PESO Fund vs MP2 Interest Rates

Investments tend to grow faster with the Pag-IBIG MP2 than the SSS PESO Fund.

From 2010 to 2021, the yearly dividend rate of the MP2 has ranged from 4.58% to 8.11%  and followed an upward trend. Its annual dividend rate over 11 years averages at around 6%, which is way higher than the average time deposit rate of 4% in the Philippines.[2]

Meanwhile, earnings with the PESO Fund grow by 1.85% to 3.75% per year based on Treasury Bond and T-Bill rates.

The SSS voluntary savings program may have lower interest rates than those of the Pag-IBIG Fund, but they’re still higher than time deposit rates of 1.13% to 3.20%. This means you can earn faster if you put your money in these government savings programs rather than in bank accounts.

SSS PESO Fund vs MP2 Maturity Period

How do these two savings programs fare when it comes to withdrawal and maturity period? Here's what you need to know.

MP2 Savings Withdrawal

The savings and dividends can be claimed after five years. However, the Pag-IBIG Fund allows early withdrawal for cases of total disability, insanity, or unemployment due to health reasons. When a member dies before the five-year maturity period, his or her beneficiaries can claim the savings.

After claiming your funds, you can opt to register for a new MP2 account, reinvest the amount fully or partially as a lump-sum payment, and keep on saving for another five-year term.

SSS PESO Fund Withdrawal

After five years of saving under the PESO Fund, you can claim only up to 35% of your savings from medical and general-purpose accounts. The rest of the fund (65%) can be withdrawn only when you reach the age of 60 or when you file for retirement or total disability with the SSS.

If you withdraw before the five-year retention period, the SSS will charge penalties and service fees.

Personal loan application

SSS PESO Fund vs MP2 Enrollment

The biggest difference between the Pag-IBIG MP2 and SSS PESO Fund is their requirement for eligibility.

MP2 Enrollment Requirements

All Pag-IBIG members, including OFWs, can enroll under the enhanced MP2 program regardless of age and monthly income. The improved savings scheme even extends to retirees or pensioners, as long as they are former Pag-IBIG members with at least 24 monthly Pag-IBIG contributions before their retirement.

Related article: Retirement Fund 101: Plan, Save and Invest for Early Retirement

SSS PESO Fund Requirements for Enrollment

SSS PESO Fund vs MP2 - SSS PESO Fund Requirements for Enrollment

The SSS has more requirements for members who wish to enroll in the PESO Fund. Any SSS member (including employees, self-employed professionals, voluntary members, and OFWs) who meets these conditions can open an account:

  • 55 years old and below
  • Paid at least six consecutive monthly SSS contributions (under the regular SSS program) within the last 12 months prior to enrollment
  • For self-employed, voluntary, and OFW members: payment of maximum contributions under the regular SSS program
  • No final claim filed under the regular SSS program (retirement, total disability, or death benefits)

MP2 Enrollment Procedures

The traditional way to open an MP2 account is by transacting at any Pag-IBIG branch nationwide. Members are required to fill out the Modified Pag-IBIG MP2 Enrollment Form and submit the completed form to the officer, who will process the application and provide an MP2 account number. The applicant may opt to pay his/her first Pag-IBIG MP2 contribution right after account opening at the Pag-IBIG office.

Pag-IBIG MP2 Online Registration

SSS PESO Fund vs MP2 - Pag-IBIG MP2 Online Registration

The Pag-IBIG Fund also accepts online applications for its voluntary savings program through the MP2 Enrollment System.[3]

Using the Pag-IBIG online registration facility, enter the required details for the application form, including Pag-IBIG number, name, birthdate, desired monthly contribution, preferred dividend payout (annually or at the end of the five-year maturity period), and mode of payment.

After submitting the online form, the completed Pag-IBIG MP2 enrollment form will appear, which indicates the member’s MP2 account number.

After generating your account number, you can proceed to paying your contribution each month or in a lump sum. Once the payment is posted, the account automatically gets activated.

SSS PESO Fund Enrollment Procedures

SSS members can enroll in the PESO Fund at any SSS branch in the Philippines. Simply complete the SSS PESO Fund Enrollment Form and submit it at the nearest SSS office.

SSS PESO Fund Online Registration

SSS PESO Fund vs MP2 - My.SSS

If you want to avoid the long lines at an SSS branch, you can apply online via the My.SSS portal. To start your SSS PESO Fund online registration, you need to create a My.SSS account first. Check this guide for instructions on how to register for an SSS online account.

Once you’ve set up your My.SSS account, log in with your user ID and password. On the homepage, hover your mouse over the e-Services tab and then click “PESO Fund.” After successful enrollment, you’ll receive an email confirmation. You can begin paying your contribution to the SSS PESO Fund.

However, SSS requires members who enrolled in the PESO Fund to personally appear at any SSS branch and confirm their enrollment. If you fail to do so, you won’t be allowed to withdraw your savings or apply for any SSS benefit.

SSS PESO Fund vs MP2 Payment Modes

MP2 Mode of Payment

Members who enroll in the MP2 program have three options for remitting their savings: salary deduction, over-the-counter payment at a Pag-IBIG branch, and payment at any accredited Pag-IBIG collecting partner.

The best Pag-IBIG MP2 mode of payment for employees is through salary deduction. If you choose this payment mode, your monthly MP2 contribution automatically gets deducted from your payroll and remitted by your employer to the Pag-IBIG Fund. No need to worry about skipping any monthly payment.

For self-employed and OFW members, transacting with accredited collection partners is the most convenient Pag-IBIG MP2 mode of payment.

Payment Channels for MP2 Contributions

Here are the different ways to pay for Pag-IBIG MP2:

  • Credit or debit card payment via the Pag-IBIG MP2 Online Payment Facility[4]
  • Bills payment centers: Bayad Center, SM Business Centers, SM Hypermarket, Savemore, M Lhuillier, and ECPay outlets (including 7-Eleven stores)
  • Mobile wallets: GCash app, PayMaya, and Coins.ph app
  • Moneygment mobile app
  • Overseas remittance partners: PNB, AUB, CashPinas, iRemit, and Ventaja

SSS PESO Fund Mode of Payment

SSS members enrolled in the PESO Fund program may remit their savings through any SSS tellering branch nationwide. Aside from the cash or check payment, a completed SSS PESO Fund Payment Form must be submitted to the teller.

Those who prefer to remit somewhere else can do so at any of the following channels that accept SSS PESO Fund payments:

  • GCash
  • Bills payment centers: Bayad Center, SM Business Centers, SM Hypermarket, Savemore, and ECPay outlets
  • Partner banks: AUB, Bank of Commerce, PNB Savings Bank, Rural Bank of Lanuza, UnionBank, and Wealth Bank

SSS PESO Fund vs MP2: Which is Better?

So, which of the two government savings programs suits you better? Here’s a table to help you easily visualize the differences between the Pag-IBIG MP2 and SSS PESO Fund.

CriteriaPag-IBIG MP2SSS PESO Fund
Age limitNone55 years old
Other eligibility requirementsFor retirees: At least 24 monthly contributions before retirement
  • At least six consecutive monthly SSS contribution payments within the last 12 months before enrollment
  • For self-employed, voluntary, and OFW members: payment of maximum contributions under the regular SSS program
  • No final claim filed
Minimum investment5001,000
Maximum investmentNo limit100,000 per year
Interest rate4.58% to 8.11% per year (average of 7.65%)1.85% to 3.75% per year
Number of accounts for enrollmentNo limitOne account only
Maturity periodFive years
  • Withdrawal after five years: 35% of savings
  • Withdrawal at age 60 or upon retirement/total disability: 65% of savings
Enrollment procedureBoth in-branch and online (but the online application requires the member's personal appearance at the branch)Both in-branch and online (but the online application requires the member's personal appearance at the branch)
Payment modes Salary deduction/over-the-counter transaction in-branch/accredited collecting partnersOver-the-counter transaction in-branch and accredited collecting partners

As you can see, the Pag-IBIG MP2 program is more affordable and flexible than that of the SSS. With Pag-IBIG MP2, you can grow money as much as you want to. It’s also easier to start saving with the MP2 because it doesn’t have a lot of conditions for enrollment. It comes as no surprise that savings from Pag-IBIG members keep on increasing[5] every year.

Pag-IBIG MP2 offers more flexibility in terms of payment channels. Members enrolled in the MP2 program can choose from a wide variety of payment facilities, including convenient ones like credit cards and mobile wallets.

The SSS PESO has its own merits, though. It’s an ideal way to increase your retirement fund, as you can access your funds only when you retire. The PESO Fund is also better as a long-term investment, while the MP2 is designed for short-term and medium-term investing.

Both government savings schemes allow their respective members to easily start saving for retirement or any financial goal through online registration. However, enrolled members still have to visit a Pag-IBIG or SSS branch to personally confirm their enrollment.

SSS PESO Fund vs MP2: How to Choose the Right Savings Program

Should you choose the Pag-IBIG MP2 or SSS PESO Fund? Your choice will depend on your goal and current situation. Take some time to assess your capacity to maintain these accounts and see which one really suits your needs. 

Evaluate your current situation. Can you afford the monthly contribution? Do you have a stable source of income to pay your contributions? Can you set aside the savings amount for an extended period? 

Once you've made an objective evaluation of your financial situation, it’s time to check your goals. Why do you want to save money through SSS and Pag-IBIG? Do you want to prepare for your retirement? Are you aiming to receive annual dividends? 

Your purpose and your current situation can help you make the right choice between these two provident funds programs.

Goal / Current ConditionIdeal Savings Program
I don't want to withdraw my savings immediately.SSS PESO Fund
I want to have multiple savings accounts.Pag-IBIG MP2
I want to secure my retirement.SSS PESO Fund
I can't save more than ₱500 each month.Pag-IBIG MP2
I want to pay my contributions for five years in lump sum.Pag-IBIG MP2
I want to receive my earnings or dividends annually.Pag-IBIG MP2
I need funds to secure my health.SSS PESO Fund
I want to receive my earnings only after I stop working.SSS PESO Fund
I want a savings account that has a fixed interest rate.SSS PESO Fund

Final Thoughts

Considering all their pros and cons, the SSS PESO Fund and MP2 suit different needs.

The MP2 is the better savings option for self-employed and voluntary members, as well as low-income earners with a limited budget who can’t afford to pay the full maximum monthly SSS contributions. It’s a great way to save up for a big purchase or anything you need in five years, like funding your travel.

On the other hand, the SSS PESO Fund is more suitable for employees, as their employers shoulder a bigger portion of their monthly SSS contributions. If you’re earning a higher income, it can also help you save for retirement.

Whichever savings program you choose, you’re on the right track with your journey to financial freedom.

Personal loan in the Philippines


DISCLAIMER: Information published on this blog or elsewhere on www.moneymax.ph should be used for general information purposes only and does not constitute investment advice, performance data or any solicitation or recommendation that any security, investment product, transaction or investment strategy is suitable for any specific person. This material does not take into account your financial situation, risk tolerance level, investment experience or objectives; all of which are unique to you. Before acting on information on this blog, we suggest consulting an independent professional to advise you on the risks of any decision and the extent of any exposure to loss.

Venus leads the blog content strategy and optimization at Moneymax as the Head of Editorial Content. She has 15+ years of experience in content marketing, corporate communications, and public relations. Venus graduated cum laude with a Journalism degree from the University of the Philippines Diliman. Before joining Moneymax, Venus had written informative guides and articles, specializing in personal finance and digital marketing. She also invests in stocks, mutual funds, VUL, and Pag-IBIG MP2. A hardcore Hallyu Tita, she enjoys bingeing K-dramas on Netflix while bonding with her rescued cats. Follow Venus on LinkedIn.