Not even the coronavirus pandemic that claimed lives, jobs, and livelihood can stop the scheduled increase in the monthly contributions of the members of the Social Security System (SSS).
Starting in January 2021, members of the state-run pension fund will see an increase in contribution rate—from the current 12 percent to 13 percent.
The increase will lead to bigger savings for the members.
“It is high time to adjust the contribution rates and monthly salary credits (MSC) of SSS to allow members to save more for their retirement,” SSS officer-in-charge Aurora Ignacio said.
With the higher contribution rate, the minimum MSC will become P2,000 from the current P1,000 while the maximum MSC will be P25,000 from the current P20,000.
Ignacio further added that the higher maximum MSC will also mean an enhanced benefits package for the members.
“The good news is that those who will save more with the SSS under the new maximum MSC of P20,000 will have a higher amount of benefits and loan privileges, as the MSC is one of the main factors used in the computation of benefits and loan privileges,” Ignacio shares.
To illustrate, Ignacio explains that a member with a monthly salary of P20,000 and has already paid 12 contributions in the 12-month period before the semester of sickness will enjoy P600 in sickness benefit per day from the current P480 per day.
“We all want a comfortable retirement and to do that, those who are in their productive years must work hard to save more. The SSS is the cheapest and most accessible pension scheme. All workers, regardless of nature of employment, must save in the pension fund for their future retirement years,” the SSS chief further stated.
More increases in the coming years
The contribution increase that will take place next year will be followed by another one in 2023 and one more in 2025.
With the series of increases in contribution, the fund life of SSS is expected to last until 2045.