SSS Will Improve Your Future

I don't like SSS. One time in a Facebook comment thread, I boldly declared that if you have a choice (employees like me, by default, don't), it's not a no-brainer to "invest" your money in SSS. In fact, it would be better to forgo it and invest somewhere else.

I've heard and seen how low the pension pay-outs are. I've heard how bureaucratic the process is. And I know that ~500 a month (the max contribution) can grow more if you just invest it in an affordable equity fund.

I was totally wrong. I failed to grasp why Randell Tiongson, at the start of the thread, said it was a basic investment and one of the first ones you make.

It took me months to realize you practically can't invest without an SSS number. All banks require it for even a savings account (you get a free pass if you're a student), let alone an equity fund.

I could invest with a broker like COL, and need only a TIN. But still my options are very limited - practically just direct stock investments, possibly forex, and piggy banks.

Retail bonds, money market UITFs, and time deposits are out of reach. It may not seem like a loss, given their relatively low returns, but they're very useful and actually needed in diversification.

Fortunately for employees like me, it's highly unlikely to be a problem - we're enrolled by default. For freelancers, micropreneurs, and maybe even OFWs, it might not be as unlikely. 

But if we want to retire well, we need SSS - but not for the pension nor the other benefits.

And since we're stuck with it, we might as well get the most out of it. In the next post we'll go over what we can get from it, and possibly how to "optimize" our investment.



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2 comments:

  1. Ooooh....I'm excited to read your next post!

    Personally, I also believe that SSS is useless as a pension plan. Admittedly, the maternity benefits are helpful but the pension is sumkinduva useless.

    I'm interested to read how you will defend SSS as a worthwhile investment.

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    Replies
    1. Hi Jill,

      Sorry, I'm afraid it's going to be anti-climactic. It's really not great at all. Were it not a bank requirement, I'd still rather not pursue it.

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