Preparing for a Comfortable Retirement Age Through the BPJS Pension Guarantee  – When entering retirement age, the necessities of life will continue to run, while income is relatively non-existent. Therefore, you must prepare for retirement with careful financial planning and be done consistently as long as you are still in your productive age to earn money.

Based on Government Regulation Number 45 of 2015, the retirement age for the BPJS Employment Pension Security program is 57 years. Furthermore, the retirement age will be increased by one year for every next three years until the retirement age, which is 65 years.

An important key in preparing financial security for retirement is saving early. You can use various financial instruments approved by the Financial Services Authority (OJK), one of which is through the Pension Guarantee from BPJS Ketenagakerjaan.

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Safe at retirement age with BPJS Pension Guarantee

Pension Security is a social security that aims to maintain a decent standard of living for participants of the BPJS Ketenagakerjaan program who have entered retirement age. This guarantee benefit is paid every month starting when a person enters retirement age, has permanent total disability, or to the heirs of the participant who dies.

The BPJS Pension Security Contribution is taken from the monthly wages received by employees with the highest wage limit based on calculations of IDR 7,000,000. The monthly fee paid to BPJS Ketenagakerjaan is three percent, with two percent paid by the employer and one percent deducted from the employee’s salary.

There are several BPJS Pension Guarantee benefits that you can enjoy, namely:

1. Old age pension benefits

This benefit is in the form of monthly cash that is given when you enter retirement age until you die. The condition is that your contribution period has reached a minimum of 15 years or the equivalent of 180 months.

2. Disability retirement benefits

This benefit is in the form of monthly cash that is given to participants who are completely disabled due to an accident and can no longer work. The cash will be given until you recover or die, provided that you have paid a minimum of one month’s dues and a density rate of at least 80 percent.

3. Widow/widower pension benefits

This benefit is in the form of monthly cash given to widows/widowers who become heirs of BPJS Employment Pension Guarantee participants . Cash is given until the widow/widower remarries or dies.

4. Child retirement benefits

This benefit is in the form of monthly cash given to children (maximum two people) who become heirs of participants who die. Cash will be given until the child is 23 years old or has worked or married.

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5. Parental retirement benefits

This benefit is also in the form of monthly cash given to parents (mother/father) who are the heirs of participants who die with single status. BPJS Employment Pension Guarantee participants are not entitled to this pension age program benefit if:

  • He entered retirement age and did not meet the 15-year contribution period
  • He has permanent total disability and has not even been a member for a month with a minimum density rate of 80 percent
  • He died before even one year of being a participant with a minimum density rate of 80 percent.

However, participants with the three criteria above will still receive lump sum benefits , namely the accumulated contributions plus the results of the development.

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Preparing for retirement

Even though they are no longer working, retirees can still earn income from savings, from renting or selling assets or goods they own, to investing in the capital market. Well , one of the steps you can take is to maximize your retirement fund.

A pension fund is a legal entity that manages and runs a program that promises benefits when you enter retirement age. The Pension Fund product provides benefits in the form of a sum of money paid by the participant after the participant retires. Pension fund functions include:

  • Collect dues
  • Develop or invest the money it manages
  • Paying pension benefits according to the rules and rights of each participant.

The Pension Guarantee Program by BPJS Ketenagakerjaan is one of the pension funds recognized and supervised by the OJK so that the security of your money is guaranteed. Apart from BPJS, there are other institutions that also administer pension funds, including PT Taspen (a pension fund for State Civil Apparatus alias ASN) and PT Asabri (for TNI soldiers, Polri, and ASN in the Department of Defense and Security).

In addition, there is also a Financial Institution Pension Fund (DPLK) for individuals who do not belong to the above groups, such as freelancers, entrepreneurs, and others. DPLK is formed by a bank or company life insurance company whose contributions are paid regularly per month.


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