Sunday, October 14, 2012

How To Compute Your SSS Pension?

I receive an email just recently asking me to post an article on how to compute SSS pensions.
For the benefit of the readers of Piso Ni Juan, I am posting here a sample computation.

You can also download the spreadsheet calculator later on this site's Downloads drop down menu for your personal calculations of your own estimated SSS monthly pension.

For full explanation of your SSS retirement benefits, you can click the link to the SSS website here.

We start our computation by knowing your average monthly SSS contribution. If you are an employee, you can ask your Accounting Dept. about this.

If your accounting personnel makes it difficult for you to have this, we can estimate this amount by checking your monthly pay slip. I know you are very much aware about your monthly SSS deductions same with the other deductions in your gross salary.

By referring to the SSS Contribution Schedule in Fig. 1 below, your estimated total monthly contribution would be the sum of your monthly deduction and your employer’s contribution.

You can find your employer’s contribution in the ER column at the right of your monthly contribution. Your monthly contribution is under the EE column.

Fig. 1. SSS Contribution Table

Let’s say you were being deducted by P333.30 pesos every month. Based on the schedule in Fig. 1, your employer’s monthly contribution should be P706.70 pesos each month. The sum of your employer’s contribution and yours will be P1,040 pesos per month. This total amount is your average monthly SSS contribution.

Tally this amount with the table in Fig. 1, your Average Monthly Salary Credit (AMSC) will be P10,000 pesos. Let’s assume that you are a member of SSS for 12 years now.

Based on the computations given by SSS, there are three formulas which we can used for calculating your monthly pension. The resulting amount based on the said three ways of computations, the amount whichever is the highest, will be your monthly pension.

Let’s get into the computations.

  • The sum of P300 plus 20 percent of the average monthly salary credit plus 2 per cent of the average monthly salary credit for each accredited year of service (CYS) in excess of ten years.

Translating this arithmetically;
                             Monthly Pension = P300 + (20% * AMSC 10yrs) +
                             Monthly Pension = P300 + (20%*P10,000) + (2% *10,000*2)

                             Monthly Pension = P2,700.00

  • Forty percent (40%) of the average monthly salary credit

                              Monthly Pension = 40% * AMSC
                              Monthly Pension = 40% * P10,000

                              Monthly Pension = P4,000 pesos

  • P1,200, provided that the credited years of service (CYS) is at least 10 or more but lessthan 20 or P2,000, if the credited years of service CYS is 20 or more.

Since you are a member for only 12 years, your month pension will be;

Monthly Pension = P1,200 pesos

Based on the above computations, the second computation yields as the highest at P4,000. Your monthly pension can be based on this amount.


The above computations are based only on the experiences and interpretation of the writer. Please consult SSS directly for concerns and questions by visiting any SSS branches near your area.