Are You Using the Ideal Product for Your Company’s Retirement Savings Program?

Every business owner should know that the best way to prepare for expenses in the future is to save for them today. There are a number of them, some of which you might be overlooking. One such expense that most fail to save for is employee retirement pay.

As discussed extensively in our previous blog, retirements can prove to be quite costly for your business. Apart from losing a tenured member of your staff, you’re obliged to provide retirees retirement pay if they meet certain conditions. This is an expense that can possibly cause disruptions that you surely wish to be spared from.

You would want to initiate a corporate retirement savings program, which prepares you for this expense before you need them.

Now, let’s say, you’re already convinced and ready to start your own program, what then? Initiating the program itself is easy, with you having two options: you can either register it with the BIR or do it yourself.. The problem many business owners run into, however, is that they allot money to save without considering how their program actually works. As a result, the program sometimes fails to achieve the original objective, which in this case is to save for the retirement pay of the company’s retirees.

Your best bet is to work with a financial advisor. Be warned though, in almost, if not all professions, there are individuals who might put their own gains above your best interests. Our industry is not exempt from that.

As the decision maker of your company, you’ll have different offers come your way, which you should very much welcome. We highly encourage you to shop your options and talk to different advisors or agents because it could prove to be the best means for you to get an idea of what’s available to you – and maybe eventually realize that it’s possible to get wrongly recommended solutions for your needs.

If it’s happened before, don’t get upset. You have to understand that not everyone who works in the industry has the necessary licenses to sell you the right product solutions. For instance, insurance agents can only sell insurance products, which won’t work for a retirement savings program.

You always want to go back to the main objective of your program when deciding on the product solution to go for. Ask yourself: What am I looking to get out of this program? Once you’re able to answer that question, the next steps should fall into place.

That’s where we come in and help guide you to the right product solution. You can rest assured that you’re working with licensed professionals that deal with a wide variety of product solutions. And our years of experience and expertise have led us to the realization that for a retirement savings program, the best product solution is mutual funds.

In case you’re unfamiliar, mutual funds is a program that pools money from investors and invests in a diverse profile of securities, including stocks and bonds. The biggest advantage is it doesn’t require any investment know-how on your part. Investment professionals take care of all the heavy lifting. You only need a projection of how much you’ll require and when, so that you have a good idea of how much to invest. If your timetable is a bit more flexible, you can even come in for as low as P1,000 and perhaps build your savings from there.

Do you see how there’s almost nothing that should stop you from initiating a retirement savings program in your company? It’s a win-win for you and your employees: you protect your company’s future by saving early for an expense that you’ll eventually need, while your employees get assurance that they’re truly being cared for.

In case you haven’t yet, grab a copy of our comprehensive guide on retirement savings programs by clicking here.