THE Social Security System (SSS) said that more Overseas Filipino Workers (OFWs) are becoming financially literate and secured as many of them are starting to invest for their future.
This, after the agency noted that the annual incentive benefits (AIB), disbursed to qualified OFWs in 2016, rose by 18.1 percent to P15.5 million from the P13.15 million provided in 2015.
SSS president and chief executive officer Emmanuel Dooc said the number of qualified OFWs with active accounts under the SSS Flexi-fund program benefited from the AIB disbursed in 2016 increased by seven percent to 43,035 from the 40,216 in 2015.
“The number of OFWs enrolled in our Flexi-fund program is really inspiring. This is evidence that our OFW-members are starting to invest more for their future, when the days of working far from their families are over and done, rest assured that the SSS is here to assist them to achieve their long-term financial security,” Dooc said.
The SSS explained that the Flexi-fund program is a voluntary provident fund program that serves as a mechanism for OFWs to save a portion of their income abroad and maximize returns of their investment. It is offered exclusively to OFWs and is designed to supplement the benefits under the regular SSS program.
Under the Flexi-fund, savings are sourced from payments not lower than P200, paid in excess of the required regular SSS contributions. Amounts are invested in fixed income securities and the interest rates are based on the average rates of SSS’ short-term placements or 91-day Treasury bill, whichever is higher, re-priced quarterly.
SSS said members’ equity as of end-2016 amounted to P606.91 million while actual investment income for the same year reached P28.5 million, of which P11.25 million was already credited to members’ accounts as guaranteed earnings.
The combined AIB and guaranteed earnings increased the total amount credited to individual Flexi-fund accounts to P26.78 million in 2016, a 25 percent-increase from the P21.37 million credited in 2015.
The AIB was launched in 2012 to encourage OFWs to maintain and increase their retirement savings with SSS. It is granted to members with no full Flexi-fund withdrawals and benefit claims within the applicable year.
Dooc explained that the AIB amount depends on the Flexi-fund’s year-end net investment income and is distributed based on the individual equity shares of all qualified members. Thus, members with higher Flexi-fund savings get bigger AIB amounts.
The maximum AIB credited to a member’s account in 2016 reached P136,498 while the average AIB per individual is P361.