By
Alma L. Tingcang
IPIL,
Zamboanga Sibugay - To encourage saving as a priority among Overseas
Filipino Workers (OFWs) and to help them
prepare for the future, the Social Security System urged all OFWs registered
with SSS to join the exclusive Flexi-Fund program.
The SSS Flexi-fund program for OFW members is a provident fund type of
retirement plan that encourages saving while they are employed overseas.
In a press release, SSS Senior Vice President and International
Operations Division Head Judy Frances A. See noted that only two in every five
OFWs are able to save from their cash remittances, citing the Philippine
Statistics Authority (PSA) 2013 Survey on Overseas Filipinos.
The PSA survey
showed that only 40.7 percent of 1.9 million OFWs who sent remittances had
savings from cash remittances, which was 2.2-percent lower than data in 2012.
"Saving should
be a priority because once they come back home and their income stops, they
would likely have to live off whatever amount they have set aside. It is,
therefore, important that they accumulate funds for a reserve, such as their
SSS savings to mitigate loss of income." See said.
See declared that saving
even a small amount on a regular basis is a good start. It can soon add up to
big gains over the long run especially if put into a safe investment vehicle.
For only a minimum
of P200 paid in excess of the maximum contribution, it already enables an OFW
member to save and build up funds that can be used upon retirement to
supplement the benefits available under the regular SSS program. Early
withdrawal of funds is also allowed in case of urgent cash needs, according to
See.
As of September
2014, existing OFW members of the Flexi-fund program reached 39,274 with total
equity amounting to P431 million. A paying OFW member has an average Flexi-fund
investment of P10,974.
See explained the
money put in the Flexi-fund are invested in fixed-income government securities
that are risk-free. Interest earnings are guaranteed, as computed based on the
average rate of SSS' short-term peso placements or 91-day Treasury bills,
whichever is higher.
The SSS estimates
Flexi-fund investments to grow at an average guaranteed interest rate of 1.3
percent this year, while Flexi-fund accounts with annual incentive benefits
(AIB) will have a total yield of 3.9 percent.
"With
Flexi-fund, OFW members can maximize the return on their savings despite the
prevailing low-interest environment. Those who will retain their savings intact
within the year will be automatically entitled to annual incentive benefits in
the form of additional earnings credited to their Flexi-fund accounts,"
See said.
SSS previously
reported that Flexi-Fund accounts in 2013 earned a total of P16.4 million at a
guaranteed interest rate averaging 2.7 percent. Total earnings comprised of
P7.24 million in annual incentive benefits (AIB) and P9.16 million in
guaranteed earnings. Flexi Fund accounts with AIB had a total yield of 4.2
percent in 2013.