Afore: how much should I save to get a pension of more than 21 thousand pesos

What is the amount I need to save to get a better pension? This is one of the most frequent questions that exist to increase resources in your Afore account. According to the National Commission of the Retirement Savings System (Consar), the fundamental piece for achieving a better quality of life is to consider voluntary savings.

The important thing is to allocate a portion of your income to your Retirement Fund Manager (Afore) on a consistent basis, which will generate a large profit in the long term, although it will depend on the percentage that is allocated.

According to the Mexican Association of Retirement Fund Managers (Amafore), there is no specific amount, and because it is a voluntary saving that can be from 1 to 13% of your salary. The only thing that should be considered is not to fail in the process month by month.

Amafore has also revealed on other occasions that accessing or generating a good pension will be the responsibility of each person. In this sense, the worker must also choose the administrator that generates the most income for him.

On this occasion we will give an example from the perspective of a woman and a man, in case they want to achieve more than 20 thousand pesos of pension for their future life.

Example 1

A 25-year-old woman, who started contributing in August 2021, and has a monthly salary of 21,538 pesos, plans to retire at age 65, will receive a pension of 10,865 pesos, that is, much less than she currently earns.

However, with voluntary savings, that is, an extra monthly contribution of at least 1,698 pesos. Then it could reach a pension of up to 21 thousand 538 pesos, this was announced by the Consar.

The example above speaks of a supposed worker, who contributes to the Mexican Social Security Institute (IMSS) with a base contribution salary of at least 5 minimum wages (21,538 pesos), who started at the age of 25 and will retire at age 65.

So, assuming annual net real income of 4%, contribution density of 80%, income will remain at five minimum wages throughout your career. The pension was calculated with life annuity and a discount rate of 3%.

It will also be important to remember that women's life expectancy is higher than that of men, since the vast majority have intermittence work and salaries are lower. For this reason, the Commission recommends that voluntary savings mechanisms be followed, with the intention of inflating your pension.

In addition, a number of benefits can be obtained by making voluntary savings, such as:

*High yields. They will be superior, compared to any other saving alternative.

*Tax benefits. All personal contributions you make to your Afore account may be tax-deductible when making the annual return.

*Flexibility. The procedure can be achieved according to your possibilities.

*Facility.- The person can do it from home. For example: with the help of the AforeMobile app.

*Security.- The investment is safe because the Afores are supervised by Consar, and you can frequently review your Afore by checking the account statement.

*Availability of resources.- If necessary, the interested party may request these resources.

*Better pension.- The idea is to increase the amount in the administrator to transform it into a better pension.

There are several ways to make voluntary savings, one of them can be through electronic direct debit, where it will be deducted directly from your bank account or payroll.

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