So, you decided to stay loyal to your company until retirement?
Ever wonder how much will you get from your company once you retire?
According to RA 7641 the Philippines has an existing law that requires the payment of a minimum retirement benefit, which is equivalent to a little more than 70% of monthly salary at retirement date for every year of service. Take note that 70% is the minimum required by law, other companies give full one month salary for computation.
But two things must be satisfied in order to be eligible for this entitlement under RA 7641.
Employees who retire – not resign with at least:
(1) minimum age of 60 years old and
(2) a minimum service years (5 years).
This means:
- Your company is not to mandated by the government to give you any retirement benefit if you retire prior the age of 60
- You should have rendered at least 5 years of service on your retirement.
Example: Juan started working 35 years old, salary is 40,000 pesos as the time of retirement at 60. The company is generous enough to give one month salary as basis of computation. How to compute?
Years of Service: 25 years (40,000 x 25 years) = 1,000,000
Above example is just an estimation. Salary increases throughout the years of service where not factored in.
How much do you think 1,000,000 can last in the future?
Your contributions to government based retirement funds may not also contribute that much. Upon computing the SSS retirement pension of Juan, he will get is: 8,300/month.
According to SSS CEO Emilio De Quiros Jr. last April 2011, the AVERAGE monthly pension a Filipino gets upon retiring is:
SSS – 2,978 pesos
GSIS – 8,586 pesos
Here is how you compute your SSS retirement pension:
SSS Retirement Benefits, Updated 2014 Is it enough for your Retirement Needs? Find Out now!
Now, it’s your turn
Compute your possible retirement benefit from your company should you retire at age 60 or older.
If you don’t plan retire in your present company at that age, don’t bother computing. If they do give you money even though you are <60, then, that’s a bonus. You are one lucky employee.
Then compute your SSS retirement benefits.
Once you get your answers, ask yourself? Is it enough for me?
Don’t skip this post without computing.
Retire Rich,
Need a Retirement Consultant? Ask me.
Read More:
- Is Employer Sponsored Life Insurance Enough?
- SSS Retirement Benefits, Updated 2014 Is it enough for your Retirement Needs? Find Out now!
- The Filipino Retirement Scenario, Find Out Where will you Belong in the Future
source: RA 7641
Disclaimer: Retirement benefits may differ from different companies, depending upon the management. The above article states the minimum required as mandated by law.
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You really enlighten me about the computation for company retirement! Thank you so much. 🙂
Glad to be of help. 🙂
Good Day Ms. Pinky De Leon.
i’m a sea base ofw and i’m with MAGSAYSAY MARITIME CORP. (my agency) for more than 20 yrs.Since we seaman have to renew contract with our agency every after contarct which is 9 months,are we also eligible for retirement compensation even contractual?
Thank you very much.
respectfully
George G Manuel
Hi Sir, for Seaman it may be a different story. Because article above only applies to permanent employees. 🙁
Hi.Ms.Pinky,how about 22 years in service and im 45 years old.Is it okay and how to compute for mu rarly retirement?
The law requires companies to give retirement with those retiring age 60 with at least 5 years of service. Early retirement is an option of your company if they choose to give you that, nonetheless, they are not required by law. It depends on your company’s rules.
Good Day Sir/Ma’am: Gusto ko lang pong magtanong regarding my retirement benefit, kasi po I’am already 60 years old last April 28, 1959. Gusto ko na po sanang mag-retire dito sa Company na pinag-tatatrabahuan ko, 14 years of service na po ako, pero sabi wala daw akong makukuha, kasi daw kailangan 65 years old ako tsaka naka-pagsilbi ako ng 20 years of service bago ako makakuha ng Retirement pay. In this regard tama po ba ung gusto nilang mangyaring batas nila para sa aming mga empleyado. Salamat po, I’am hoping na sana mabigyan-linaw kung tama po ang batas nila.
60 years po, optional retirement na. Pwede na po, Lalo na if Naka pag contribute na kayo ng more than 120 months sa SSS. Meron na po kayong pwedeng maging pension non.
Good PM mam! My husband is 49 and he was already retiring from his work as a school and church driver for 20 years.eligible po ba sya sa retirement pay?ano po ang mga benifits na makukuha nya sa company na pinagtabahuan nya? He is working in a school run by a church
Hi, the article above is the standard computation, which differs from company to company, please do ask your HR tungkol sa benefits na binigigay po nila. thank you