Pag-IBIG MP2 Calculator
The Pag-IBIG MP2 program is a voluntary saving sister version of the Pag-IBIG fund program, launched by the Philippines government. The objective of this program is to save a portion of your monthly income and provide dividends over it for a period of five years.
However, selecting what amount to set for monthly payments can be a challenge, especially when a lot of technical terms are involved. But no longer worry about it, as this Pag-IBIG MP2 calculator will do everything for you to determine the desired dividend earnings and monthly contributions.
Pag IBIG MP2 Calculator
Terms to Know for MP2 Calculations
Before we start discussing how the Pag-IBIG MP2 calculator works, let me discuss some useful terms that will help you understand the calculations better. Please note that the IBIG MP2 calculator uses these amounts to calculate your returns at the end of each year.
- Starting Amount is the total amount you will have to invest or have already invested in the MP2 saving program.
- Additional Contribution is the money you invest in each period.
- Contribution Frequency is the frequency of regular contributions of your paid investments. Typically, it is assumed that contributions are made at the end of the selected period.
- The expected Rate of Return is the rate at which you make investments in the Pag-IBIG MP2 program. This rate of return is directly proportional to the frequency of your contributions.
- Years to Grow refers to the number of years you have to save. Usually, the MP2 program has a five-year validity, but you can always reapply for another program when the previous one matures.
- Dividend Rates: Simply put, the dividend rate is the rate at which your MP2 savings will earn dividends. These dividends are declared by the program each year and it is usually dependent on the performance of the fund overall.
How to Use Pag-IBIG MP2 Calculator?
There are many Pag-IBIG MP2 calculators that use all the above-mentioned amounts to derive your monthly contributions, so you can determine your desired savings. All you need to do is put in the approximate values of each entity discussed above. That said, please note that the total returns depend on the interest rates of the MP2 funds.
Overall, this MP2 savings calculator is a handy tool for members who are planning to curate a long-term saving strategy under compliance standards. It helps them estimate their dividend earning and total savings over a certain period of time. Therefore, after using this calculator, they will be better equipped to make decisions regarding their financial future.
To use the calculator, all you have to do is select your MP2 savings account type (virtual or fund branch) and input the required fields. After this, you have to select the payment channel and it gives you a breakdown of your total dividends on monthly contributions and accumulated savings for the year’s decided interest rate.
Just to give you an idea of how much you can invest in the MP2 scheme and what your returns will be after 20 years, here is an example of the returns with a dividend rate of 6.09%.
| Monthly Contributions (in Php) | Savings in 20 Years (in Php) | Total Dividends Earned at 6.09% (in Php) | Total Accumulated Savings in 20 Years at the Given Dividend Rate (in Php) |
| 200 | 48,000 | 44,085 | 92,085 |
| 400 | 144,000 | 132,254 | 276,254 |
| 1200 | 288,000 | 264,509 | 552,509 |
| 2000 | 480,000 | 440,849 | 920,849 |
| 3000 | 720,000 | 661,274 | 1,381,274 |
As suggested by this table, a person has to invest around Php 200 each month for around five years to get the desired amount of Php 92,085, if the dividend rate of that year is 6.9%. Similarly, the amounts increased will give you more accumulated savings over time. One thing to consider here is that the increase after every increase in the contributions gives you a similar gap between the accumulated savings.
From 2014 to 2018, the dividend rate of the MP2 savings largely remained around 6%. As discussed above, each year, the program allocates a different dividend rate, derived from the yearly income of the fund, which is then used to determine your returns by the Pag-IBIG MP2 calculator. Here is a list of mp2 dividend rates from 2011 up until the present.
| 2011 | 4.63% | 2018 | 7.41% |
| 2012 | 4.67% | 2019 | 7.23% |
| 2013 | 4.58% | 2020 | 6.12% |
| 2014 | 4.69% | 2021 | 6% |
| 2015 | 5.34% | 2022 | 7.03% |
| 2016 | 7.43% | 2023 | 7.04% |
| 2017 | 8.11% | 2024 | Yet to be decided (expected 7.03%) |
Tips to Maximize Your Returns from the Pag-IBIG MP2 Program
It is pretty natural that you want to maximize your returns on the Pag-IBIG MP2 contributions. Here are a few tips that may help you in this regard.
- The first condition to maximum returns is being consistent and regular with your contributions. All you need to do is show up every month to make a contribution, and it will automatically increase the compound interest, increasing the value of your account as well.
- Moreover, another thing that may help you increase the returns is deciding the right contribution amount. First of all, think about the amount you can afford every month and make sure you are able to make this amount every period. That said, always consider that saving more will give you a higher return.
- Always focus on a long-term strategy and do not get lost in the short-term contributions. Before you invest in the program, your objective should always be to set aside the required amount for 5 to 10 years, just to be safe, if possible. Then, you always have the option to extend it if possible.
- If you are still uncertain about the money to invest in the MP2 program and how it can benefit you in the long run, always try consulting a professional financial advisor. They can better advise you in curating a plan that is tailored to your objectives and needs.
How Much Should I Contribute to MP2?
Well, the minimum suggested contribution decided by the Pag-IBIG MP2 funds is Php 500 per remittance and there is no limitation on the maximum invested amount in the savings program. And, if you are planning to make a one-time deposit of an amount exceeding Php 500,000, it is required that you make a remittance through a personal check. Apart from this, you are also required to submit proof of income or source of funds over any deposited amount exceeding Php 100,000 in the MP2 savings account.
Can I Pay Pag-IBIG MP2 Twice a Month?
Yes, definitely; you have the option to pay the MP2 contributions on a weekly basis, twice a month, monthly, biannually, annually, and even as a one-time lump sum. However, if you want to maximize the savings on the invested contributions, it is better to deposit a higher amount all in one go as compared to splitting it into multiple deposits over time. This will automatically increase your returns significantly, given the overall compound interest.
Can I Withdraw My MP2 Before 5 Years?
Yes, the Pag-IBIG MP2 scheme allows you to per-terminate or fully withdraw your MP2 savings before the maturity period (5 years) is over. The permissible reasons for withdrawing your MP2 savings are as follows.
- Total disability or insanity.
- Death of the MP2 beneficiary or someone from his/ her immediate family.
- Pre-termination from service in case of health issues.
- Early retirement or retirement. It applies when the MP2 saver is not already a retiree.
- Permanent department from the native country.
- If the MP2 saver is unable to pay any more monthly contributions due to sudden unemployment (From layoffs or closure of the company).
- Critical illness of the MP2 saver or any of his/ her immediate family members. This must be proved by a licensed physician, subject to the approval of the IBIG MP2 funds.
- In case of repatriation of an overseas Filipino worker member from the host country.
- Other genuine meritorious grounds that may be approved by the Pag-IBIG Fund program.
If you have opted for compounding of your MP2 dividends and now plan to pre-terminate your savings for reasons other than those mentioned above, you will only receive 50% of the earned dividends. Moreover, if you have opted for annual MP2 dividends and now plan to pre-terminate your savings, you will only be entitled to your total savings, and no dividends earned over it.
What If I Stop Paying My MP2?
Well, the Pag-IBIG MP2 is a voluntary saving program, so you are not really obligated to pay the entire deposit money into your account. And, even if you have stopped contributing to the MP2 savings account, it will still continue to give you dividends earned over the already invested amount until the 5-year maturity period is complete. Moreover, there is no penalty for not adding more funds to your account, so you can deposit as much as you have, without thinking about the consequences.
What Happens to MP2 after 5 Years?
Once your MP2 account has matured over five years and your required deposits have been made, you are now free to claim your savings and withdraw them from the account. Also, if you plan to extend the plan for another five years, re-apply for a new MP2 account under the scheme and you will get to earn dividends for another term.
However, if you do not claim the MP2 account savings after the maturity period is complete, you will stop earning the dividends under the decided saving rate. That said, it will keep earning based on the dividend rate for the next two years, even if it is not claimed. Once this period is over, your account will stop earning any sort of dividends over the deposited amount.
FAQs
Who is qualified for a Pag-IBIG MP2 saving account?
According to the Philippines Home Development Mutual Fund, any member of the Pag-IBIG who is between the ages of 18 and 65, OFWs Overseas Filipino Workers, and self-employed individuals can apply for the MP2 account.
How much can I save in Pag-IBIG MP2?
There is no allocated limit on the Pag-IBIG MP2 savings. However, according to the policy, you must make a contribution of Php 500 the first time you make a contribution. After this, you can contribute any amount up to Php 10,000 per month.
Is MP2 dividend earning tax-free?
No, MP2 savings and dividend earnings are subject to taxes in the Philippines. According to Pag-IBIG, there is a withholding tax of 20% on the total dividends made over one calendar year exceeding 10,000 Php. For instance, if you earn around 15,000 Php in the dividend, 20% of this amount, which is Php 5,000, will be deducted automatically.
Can I withdraw my MP2 money before five years?
Yes, of course; you can always withdraw your money from the MP2 savings account before the 5-year period is over, without thinking about the penalty. However, there are some instances that apply to the withdrawal of the MP2 money. Any other reason will result in due deductions from the dividends.
What happens if I skip the MP2 contribution?
The MP2 account won’t be automatically terminated, even if you skip a monthly contribution. However, in this case, you will not earn the dividends on the missing amount. Depending on your record, though rarely, the fund may apply a penalty on you for a missed contribution.
Final Thoughts
In essence, with a Pag-IBIG MP2 calculator, it is easier to estimate your monthly earnings for your desired dividends. I hope this guide was helpful for anyone who had no clue about the contributions and accumulated savings over the deposited money.
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