Finally, it’s the third working day of the year and just like everybody else from the working population, I am back to work. Indeed, the recent holiday has been a short and relaxing respite from last year’s workload and this year, 2021, is another year to start anew. Time to revisit our personal and family goals and for the Social Security System (SSS), which I represent, to adopt better and more beneficial programs for our members and pensioners alike.
The Covid-19 pandemic has taught us several lessons and one of those is taking care of ourselves and saving for our future as well. We have faced various uncertainties and challenges for the past few months and the important thing is, we all survived.
Twenty twenty-one is full of opportunities. One of this is the Provident Fund that we have launched in our social-media platforms late last year, which is part of the significant provisions under Republic Act 11199 or the Social Security Act of 2018 when the new law was amended and approved by President Duterte in March 2019.
Side by side with the implementation of the 1 percent Contribution Rate Increase starting this month, we have launched the Workers’ Investment Savings Program (WISP), a Provident Fund Program of SSS.
What is WISP? It is a safe, convenient, principal-protected, and tax-free individual retirement savings plan that will serve to augment members’ benefits from the regular program.
Since the regular program puts a cap of P20,000 Monthly Salary Credit (MSC) in calculating benefits, the WISP will cover the contributions more than the P20,000 MSC or up to the prescribed maximum MSC.
Coverage under the WISP will be automatic to all private-sector employees, self-employed individuals, OFWs, and voluntary members who have no final claim in the regular SSS program, have contributions in the regular SSS program, and have an MSC that exceeds P20,000.
Contributions in WISP shall be paid together with contributions in the regular SSS program. This will also allow faster accumulation of a worker’s savings because of the employer share in the contribution. WISP contributions will be invested following the principles of safety, high yield, and liquidity, and as provided under the SS Act of 2018, which will yield additional pension income for contributing members.
However, earnings realized from them will be distributed proportionately based on the member’s contribution.
The total accumulated account value (AV) of the member under the WISP will be the basis of his/her additional benefits, which will be given at the same time during his/her retirement, total disability, and/or death benefits.
Unlike our programs under the Flexi-Fund Program for OFWs and the Personal Equity and Savings Options Program (PESO) with early withdrawal or refund prior to member’s retirement, the benefits under WISP can only be released to a WISP member upon his final benefit claim.
Compared to Flexi Fund, members can avail themselves of annual dividends while under WISP, benefits will be given in annuity or lump sum, depending on the manner of payment of his/her benefit under the regular SSS program.
The annuity will be given in the form of a fixed amount monthly pension to be paid until the member’s AV is fully settled, covering at least 15 years. Worth mentioning also is upon the death of a WISP pensioner, any remaining balance in the accumulated AV will be paid to his/her beneficiary in lump sum.
What’s great with this program is that members are now assured of higher additional benefits when they retire.
To quote renowned American investor Warren Buffet, “The best investment you can make is an investment in yourself…. The more you learn, the more you’ll earn.”
He is right.
Have a great week ahead!
Aurora C. Ignacio is SSS president and chief executive officer.
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