Security Bank’s Trust and Asset Management Group sees employee retirement programs growing in 2021 and becoming part of the new normal for most companies as they recover from the economic effects of the COVID-19 pandemic.
The investment group invited RB Zalamea, chief operating officer of E.M. Zalamea Actuarial Services Inc. and one of the group’s consultants, to talk about the importance of having a retirement plan for both employers and employees in a recently-held webinar for clients.
Zalamea said that more companies had started offering employee retirement plans specifically the Defined Contribution type which follows the retirement plans of other economies such as the United States and Europe.
“In the last five years, 40 percent of companies that have started their retirement plans set up a Defined Contribution type of fund as it engages employees more and encourages employee retention. The fixed monthly contribution allows employees to see their fund growing inside the company. In the new normal, we can expect these numbers to continuously grow as companies further realize the need for such funds,” said Zalamea.
The new trend of companies availing of DC plans stems from the changing retirement mindset of millennials who prefer fixed monthly contributions with higher returns versus the defined benefit plan that most companies offer employees.
“Despite the move of newer companies to offer DC programs to employees, the appointment of a Trustee is still very important as they will be the ones to help guide and grow the funds of would-be retirees,” said Zalamea.
Security Bank’s Trust and Asset Management Group has been managing the investments of Filipinos since 1951.
Echoing Zalamea’s statement, Carmela Lim, sales and account acquisition head at Security Bank Trust and Asset Management Group, said: “It is important to have a retirement fund in place, especially during uncertain times, like the COVID-19 pandemic we are currently experiencing. The changing investment landscape is a good time to assess and review options for a company’s retirement fund.”
“Here in Security Bank, there are many investment options available that would allow companies to grow their fund and receive good investment returns. We are happy to be of service to clients who need expert advice in this area,” said Lim.