To be able to compute your SSS Pension based on your monthly contributions beforehand gives you a clearer vision of your financial sources in the far future. The SSS pension is one of the benefits you can avail when you retire from many years of working and being an active member of Social Security System.
Perhaps, many people are not yet aware how to compute the SSS pension they’ll receive when they retire from employment or reach the retirement age. This is commonly overlooked by many members since it is not that highly demanding attention as well as being a member of SSS is compulsory under the law.
However, there are many benefits you can get by being a member of SSS and a retirement benefit is one of them. This surely stands as a financial support when the time comes that your capabilities and health cease to become what you are right now. It is not a very handsome amount but it should not also be ignored.
How many months are required to avail SSS Pension?
So this is a very common question you might ask. According to SSS, you should have made at least 120 monthly contributions before you can avail the SSS monthly pension retirement benefit. That’s a minimum of 10 years of being an active member of SSS.
Can you get a lump sum payment from SSS?
Of course yes! The SSS offers two types of retirement benefits, the lump sum and monthly pension. When you decide to get the lump sum benefit, you’ll entitled to receive all of your contributions including your employer’s share plus the interest from SSS.
When you reach the retirement age but you have not completed the required 120 monthly contributions, you are entitled to receive a lump sum payment. However, you may choose to continue to contribute voluntarily until you reach the required number of contributions. Then, you may file an SSS pension application.
What is the retirement age in SSS?
When you reach 60 years old, you can file an application for SSS retirement benefit. This is given that you have contributed at least 120 monthly contributions. However, if you still wants to continue to work or being employed, you need to wait until you retire from employment.
On the other hand, when you reach the retirement age of 65 years old whether retired from work or not, you are entitled for an SSS retirement benefit. You can choose either a one-time lump sum payment or you choose a lifetime SSS monthly pension.
How to Compute SSS Pension Based on Your Monthly Contribution?
So there are 3 methods or formula on how to compute your SSS Pension. Among the three, the result which has the highest computation shall be your SSS monthly pension.
There are several factors or variables on play that affects the amount you’ll receive as a monthly pension, this includes your average monthly salary credit (or contributions), credited years of service and number of dependents which should not exceed five.
Pension Formula 1. The sum of ₱300 plus twenty (20) percent of the average Monthly Salary Credit (MSC) plus two (2) percent of the average monthly salary credit for each Credited Year of Service (CYS) in excess of 10 years.
Pension Formula 2. Forty (40) percent of the average Monthly Salary Credit (MSC).
Pension Formula 3. ₱1,200 if the Credited Years of Service is at least 10 years but less than 20 years; or ₱2,400 if the Credited Years of Service is 20 years or more.
So let’s put an example to make these formula clearer to understand.
Let’s assume that you are about to retire now and you have been working for 35 years and at the same time, you are an active member of SSS. You have been working as an Office Clerk with a monthly salary of ₱20,000.
Since the ceiling or cap of SSS monthly salary credit is pinned at ₱16,000, you are contributing the highest amount of ₱1,790 every single month for 35 years. So even if your salary is 10x more than the highest salary credit, still you are going to contribute ₱1,790.
So this is the SSS Contribution Table of SSS.
Then this is where you belong in our given example.
So here are the computations of your SSS Pension based on our given example and the 3 formulas SSS provide. Let’s just simplify the formula in words into mathematical one.
Monthly Salary Credit (MSC): ₱16,000 (Although your salary is ₱20,000 but as explained the highest salary monthly salary credit cap is ₱16,000)
Credited Years of Service (CYS): 35 Years
Pension Formula 1. ₱300 + 20% of average MSC + [ 2% of average MSC x (CYS – 10 years) ]
= ₱300 + ( ₱16,000 x 20% ) + [ ₱16,000 x 2% x (35 years – 10 years) ]
= ₱300 + ₱3,200 + [ ₱16,000 x 2% x 25 years ]
= ₱300 + ₱3,200 + ₱8,000
= ₱11,500
Pension Formula 2. 40% of average MSC
= 40% x ₱16,000
= ₱6,400
Pension Formula 3. ₱1,200 if less CYS is 10 years but less than 20 years; ₱2,400 if 20 years or more
= ₱2,400 (since your credited years of service is 35 years)
After the computation based on 3 formulas, the first formula yields the highest amount which is ₱11,500 while the second and third formulas are ₱6,400 and ₱2,400, respectively. So this means that your SSS monthly pension based on the example is ₱11,500.
Additional Benefits
If you have children, each shall receive a dependent’s allowance worth 10% of your monthly pension or ₱250 each depending on which is the highest amount. You can only include up to 5 dependents starting from the youngest child. The dependent’s allowance shall stop when your child reaches 21 years old, gets married, gets employed, or dies.
If however, your dependent is not capable to work or support himself/herself due to physical or mental disabilities acquired when the child is still minor, then the dependent’s allowance is granted for his entire life.
GOOD NEWS! Last year, our Philippine President Rodrigo Duterte approved the ₱1,000 SSS pension increase. Millions of SSS pensioners have started receiving this increase since January last year. This surely brought smiles in the faces of many pensioners.
Related SSS Guides:
That was the general guide on how to compute SSS pension based on your monthly contributions and other contributing factors. Let us know your thoughts in the comment section below.
