Nobody wants to live a miserable life after retirement. To plan from here, you will definitely need to consider some realities in life. You will never want a scenario that you are at the mercy of anybody, ever relying on them even for your basic needs and little freedoms. You will definitely need economic power even after retirement, especially if you are still strong, or physically able.
Care to consider these obvious facts that you may not be aware of?
1.It will be difficult to find a job in the Philippines when you are older or after your retirement.
Although the law against age discrimination when hiring employees (Republic Act 10911) was already effective last February 2, 2017, this is not a guarantee. Companies in the Philippines will always choose younger and inexperienced candidates for a lot of reasons but especially because it is economical. The law is definitely a positive move but does not promise an older person a job.
It will be a tough decision to leave a job when you are older and decide to find another. There is a slim chance that you will land a job that will pay you more. Of course, this will always depend on the skills you have or what you are capable of doing but this is a risky thing to do. As stated above, companies, firms, and organizations will always put their money on younger candidates given the rise in newly graduates and younger applicants, and of course, for cost-savings or cost reduction purposes.
Unlike in other countries like Singapore, they allocate jobs but light ones for their seniors. You will notice it when you visit their country.
2. Your retirement pay is not enough to bear the expenses of living after retirement.
“Mabuti na ‘yan sa wala. (It’s better than nothing.)” This is the usual statement people make estimating that the amount of money a particular person received is very small. While this is such a comfort to hear for some, living in reality is a totally different situation – with not enough funds to spend your retirement years is truly depressing.
The Retirement Pay Law (Republic Act No. 7641) requires employers to pay when an employee retires. Unfortunately, given the minimum requirements of this law, it is not possible to live comfortably when you retire. If you worked for fifteen years (as an example) until retirement with a monthly salary of P20,000 per month, you will not even receive more than P200,000. Where will that amount take you? How are you going to fare with the many factors (especially inflation) that could affect your future spending and living?
If you are simply guessing how much you’ll need when you retire, you may end up with a wrong estimate that will cost you an uncomfortable living after retirement. You may have to ask what Mr. Alvin T. Tabañag is asking – How much do you need to retire in comfort? It will help to find a basis to calculate how much you will really need in your retirement days.
3. Your SSS pension will just be enough to sustain the basic needs.
Republic Act No. 8282 or the Social Security Law will give you your monthly pensions depending on the contributions you made. A maximum monthly contribution of P 1,760 will give you around 15,750 or over. If you are alone tending to all of your own needs by the time you retire, this is not enough depending on many different situations. Or you will most likely have no chance to treat yourself on a vacation if your children still depend on your support, or if you are nurturing a lingering illness.
Self-employed and voluntary contributions, which are 11% of the monthly salary credit, will depend on the declared compensation upon registration. So, if you volunteer for just a small amount of P575, for example, you correspondingly get a small monthly compensation when you retire.
Fortunately, there are retirees whose children are prosperous and take care of their needs up to the deathbed. In this case, the SSS pension will be more than enough to treat themselves one way or another. On the other hand, if you belong to the bigger percentage of future senior citizens who are not enrolled in SSS or GSIS, you will not receive any pension.
4. ‘Social pension’ is simply pantawid or a meager way to get by.
RA 9994 of 2010 authorizes P500 monthly cash transfer to the poorest citizens. Even if you are the most frugal elderly, or a person who tries to live as simply as you can, this amount will not in any way help you survive. It will not even affect the total of your future earnings.
You cannot be thankful with such an amount that will only last for a day or two. Also, you are lucky if you are even in the list of qualified recipients. As to this writing, the distribution system of the said ‘social pension’ is still inefficient with the many reported irregularities.
Simply put, there is no state-funded non-contributory pension you can consider now. Everybody can only hope but unfortunately, you cannot plan for your future retirement with no concrete figures to expect.
5. The Philippines does not have a well-functioning healthcare system.
Part of your future expenses will include your health and medical needs. The current situation of the healthcare system in the Philippines will not guarantee you excellent services. In order for you to receive better healthcare services, you need to pay private hospitals and clinics. The public hospitals do not charge fees or charge smaller fees only equal to the substandard facilities, technologies, and services that they have.
Those who can afford (comprising only of a small percentage of the population) consider hospital services (private) and medicines as affordable. You will definitely choose public hospitals if you belong to the larger group with lower-income. Still, you will need money for the medicines. PhilHealth, the country’s universal health coverage system, only provides health insurance and healthcare services.
6. The cost of living in the Philippines is high.
For expats, the cost of living is considered low and affordable but if you are a citizen living and working in the Philippines, it is not the case. In a salary calculator provided by Expatistan for the cost of living in Manila demonstrated with the most recent price update dated August 22, 2017, you will definitely deduce that to live comfortably, it will cost you a lot of money.
Considering that you are penny-wise and will not spend on any excess, your expenses will almost be equally the same if you are working with a meager income. In addition, if you think of your future retirement, the prices of commodities will be up and you will definitely need more earnings and savings.
Given these facts, with your future retirement plans, what do you plan to do with your current earnings and savings?
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