PERA Facts: Personal Equity and Retirement Account Philippines
When we think about preparing for retirement, many Filipinos still rely on the traditional ways—like saving through banks, keeping real estate, or depending on pensions from SSS or GSIS. But in reality, these sources are often not enough to cover medical expenses, rising living costs, and the lifestyle we want in our golden years.
This is why the Personal Equity and Retirement Account (PERA) exists. If you haven’t heard of it yet, this government-backed program is designed to give Filipinos a tax-advantaged way to save and invest specifically for retirement—similar to the 401(k) and Roth IRA plans in the United States.
In this blog, let’s dive deep into what PERA is, how it works, who can open one, what benefits it offers, and the current administrators and investment options available. By the end, you’ll see why PERA can be a game-changer in your long-term financial planning.
What Exactly Is PERA?
The Personal Equity and Retirement Account (PERA) is a voluntary retirement savings and investment program created under Republic Act No. 9505, signed into law in 2008. However, it only became available to the public in 2017 after the Bureau of Internal Revenue (BIR) and the Bangko Sentral ng Pilipinas (BSP) finalized the rules.
Simply put, PERA allows Filipinos to contribute money into a retirement account that can be invested in various financial instruments. In return, you get tax breaks and incentives that regular savings accounts or investments don’t provide.
Who Can Open a PERA?
One of the great things about PERA is that it’s open to practically every Filipino who wants to secure their future.
✅ Locally employed Filipinos – As long as you have a Tax Identification Number (TIN) and verifiable income.
✅ Self-employed individuals – Freelancers, business owners, or professionals who want to grow their own retirement funds.
✅ Overseas Filipino Workers (OFWs) – In fact, PERA was specifically designed to help OFWs save since many of them don’t benefit from local pension systems.
You can only have one PERA account but may invest in multiple products under it.
How Much Can You Contribute?
The law sets a maximum annual contribution:
- ₱100,000 per year for locally employed or self-employed Filipinos
- ₱200,000 per year for OFWs
This contribution limit ensures that PERA is focused on long-term retirement goals and not short-term speculative investing.
What Are the Benefits of PERA?
Here’s why PERA is attractive compared to ordinary investments:
- Tax Incentives
- You’ll receive a 5% tax credit of your annual contribution, which you can use to pay income tax.
- Earnings and withdrawals upon retirement are tax-exempt as long as conditions are met.
- You’ll receive a 5% tax credit of your annual contribution, which you can use to pay income tax.
- Long-Term Security
- Funds are locked in until retirement age (60 years old), or after at least five years for qualified withdrawals. This discipline ensures you don’t spend your retirement savings too early.
- Funds are locked in until retirement age (60 years old), or after at least five years for qualified withdrawals. This discipline ensures you don’t spend your retirement savings too early.
- Multiple Investment Options
- You’re not limited to just one fund—you can diversify your PERA across equity funds, bond funds, UITFs, insurance products, and more.
- You’re not limited to just one fund—you can diversify your PERA across equity funds, bond funds, UITFs, insurance products, and more.
- Professional Management
- Accounts are handled by BSP-accredited administrators and custodians, ensuring safety and accountability.
- Accounts are handled by BSP-accredited administrators and custodians, ensuring safety and accountability.
How to Open a PERA Account
Setting up a PERA account is simple once you understand the roles of the key players:
- Choose an Administrator – These are BSP-accredited institutions that oversee your PERA. Examples include banks, trust companies, and digital platforms.
- Select a Custodian – This is a separate entity that holds the funds you contribute, ensuring transparency.
- Pick Your Investments – Based on your risk appetite and goals, you can choose from a list of approved PERA products.
For example: You open a PERA account with BDO (administrator), assign a custodian, and then invest in the BDO PERA Equity Index Fund.
Current PERA Administrators in the Philippines
As of today, the following are approved administrators:
- ATRAM Trust Corporation
- BDO Unibank, Inc.
- BPI Asset Management and Trust Corporation
- Land Bank of the Philippines (launching soon)
- Seedbox Philippines (digital platform provider)
This means you have both traditional banks and fintech options to choose from.
PERA Investment Options
Here are the latest available PERA funds and their details:
BDO PERA Funds
- BDO PERA Short Term Fund
- Minimum Initial: ₱1,000
- Trust Fee: 0.50% p.a.
- BDO PERA Bond Index Fund
- Minimum Initial: ₱1,000
- Trust Fee: 1.00% p.a.
- BDO PERA Equity Index Fund
- Minimum Initial: ₱1,000
- Trust Fee: 1.00% p.a.
BPI PERA Funds
- BPI PERA Government Bond Fund – Trust Fee: 1.00%
- BPI PERA Equity Fund – Trust Fee: 1.50%
- BPI PERA Corporate Income Fund – Trust Fee: 1.25%
- BPI PERA Money Market Fund – Trust Fee: 0.50%
(All with ₱1,000 minimum investment)
Land Bank PERA Funds (launching soon)
- PERA Bond Fund – Minimum ₱5,000
PERA Money Market Fund – Minimum ₱5,000 - PERA Global Dollar Fund – Minimum $200
Metrobank / ATRAM PERA Funds
- PERA Bond Fund
- PERA Equity Fund
PERA Money Market Fund
(Minimum investment assumed ₱1,000, with management fee around 1% p.a.)
Is PERA Worth It?
The short answer is: Yes—if you’re serious about retirement planning.
Here’s why:
- Ordinary savings accounts give minimal interest.
- Mutual funds and UITFs grow wealth but don’t provide special tax breaks.
- PERA gives you both investment growth + tax benefits designed for your future.
The only downside is that your funds are not liquid—you can’t withdraw them freely until retirement age. But then again, that’s the whole point: PERA forces you to commit to your long-term future.
Final Thoughts
Retirement planning is not just about having money; it’s about having peace of mind. With inflation rising and life expectancy increasing, Filipinos can no longer depend solely on pensions or family support.
The Personal Equity and Retirement Account (PERA) provides a structured, tax-advantaged way to grow your wealth for the years ahead. By starting early—even with just ₱1,000—you can take advantage of compounding, diversify your portfolio, and enjoy a more comfortable retirement.
So, is now a good time to open a PERA account?
Absolutely. The best time to start was yesterday. The next best time is today.
