If you aren’t already investing or increasing your retirement savings, now is the best time to do so. You may think that your SSS retirement benefits will be enough to cover your needs for when you retire, but they will never be.
You shouldn’t rely on just the SSS pension. The government agency’s fund life was reduced to 2032 (from 2042) when the initial PHP 1,000 pension hike was given to pensioners in 2017. According to SSS President and Chief Executive Officer Emmanuel Dooc, the fund life might be further cut down to 2026 if the government implements the second round of the pension hike in 2019.
This means by 2026, the SSS will no longer have the funds to pay for the benefits of its members, including you.
If you’re wondering how much you’ll get from the SSS when you retire, here are the answers to the questions you likely have in mind about the SSS pension.
Pensioners will receive an amount that depends largely on the credited years of service and the number of dependent minor children (not exceeding five).
Here’s a look at the basic computation for a monthly pension, which will be the highest of these three:
For example, someone earning PHP 30,000 and has contributed to the SSS for 40 years can get (according to the SSS contribution table):
Monthly Pension (MP) = P300 + (20% of AMSC) + (2% of AMSC* 30 years (40 years – 10))
MP = P300 + (20%*16,000) + (2% *16,000* 30)
MP = 300 + 3,200 + 9,600
Monthly SSS Pension = PHP 13,100*
*Note: This SSS pension computation doesn’t account for inflation. For more accurate estimations of your expected pension, consult your local SSS office.
Will this be enough for you to live on? Probably not, depending on your lifestyle, especially since this is less than half of your salary.
Does the pension computation above seem too complicated to grasp? Try the SSS Retirement Benefit Estimator that allows you to quickly get an estimate of your SSS pension.
Using this online calculator is easy. Just enter your birthdate, month and year when you started as an SSS member, and monthly salary. Then enter the captcha code and click the Compute button.
The SSS calculator will show you two sets of monthly pension amounts: one for when you retire at age 60 and another for when you retire at 65. The SSS pension is higher if you choose retirement at age 65.
A number of other benefits come tacked onto the SSS Retirement program, such as a 13th month pension and automatic PhilHealth membership if you aren’t already a member and are 65 years of age and above.
The PhilHealth membership extends its hospitalization benefits to you and your legal dependents. Of course, this only applies if you have made 120 PhilHealth contributions.
The children of a retiree (regardless of actual blood relation or legitimacy) who are minors are also entitled to a dependents’ pension equal to 10% of the retiree’s pension or PHP 250, whichever is higher. This allowance applies to only five children, all of whom must be minors, and will last until their 21st birthday.
Upon the passing of the retiree, the primary beneficiaries listed as of the date of retirement will be entitled to 100% of the pension and the dependents to the dependents’ pension. Should the retiree pass away 60 days from the start of the monthly pension and have no primary beneficiaries listed, the secondary beneficiaries will be awarded the lump sum benefit equal to the five-year guaranteed period, excluding the dependents’ pension.
Your retirement benefit comes as a cash payment you’ll receive when you can no longer work because of old age. There are two ways to qualify for retirement benefits:
All retirement benefits claims can be filed at any SSS branch or representative office.
You can receive your retirement benefits in either of these two ways: a lifetime monthly pension, or a lump sum payment. If you reach 60 and decide to work again, the monthly payment of your pension will be suspended until you hit 65.
SSS will pay your monthly pension or lump sum benefit through your designated bank (ideally the branch nearest to you). When you make your retirement benefits claim, SSS will require you to open a single savings account and submit a photocopy of your passbook, ATM card, initial deposit slip, bank statement, or Visa Cash Card enrollment form.
The lump sum is an option to receive the first 18 months of your pension at a discounted rate that will be determined by the SSS. You’ll receive your pension monthly on the 19th month and onward.
Whether you’re already close to retiring, or nowhere near it, it’s always a good idea to know exactly how your SSS pension will work. It can figure into your retirement planning, or remain outside of it as a buffer.