If you’re employed by a regulated entity in Jamaica, you’re likely contributing to the National Insurance Scheme (NIS). In that case, you will be entitled to a pension upon reaching the set age of retirement. But if you are self-employed or informally employed, what is your avenue for a financially secure golden years?
Although some persons posit that the NIS facilitated pension is barely adequate to cover living costs, the bigger question is, what happens if you are self-employed or employed by someone/entity that does not facilitate a contribution to the NIS?
Are you one of those persons?
Does this mean you’re doomed after you reach retirement age?
No. Fortunately for you, there are now several options available for self-employed individuals to secure their future with a pension plan. First, you can contribute to the NIS as a self-employed individual (in fact, you’re required to register with the scheme). According to the regulatory body in charge of the NIS, “a total contribution of 5% of gross salary (up to the maximum insurable wage ceiling defined by the NIS) is to be remitted annually using the stamp card and income tax return.”
Whether you are self-employed, informally employed, or you want to have more than one financial source after your retirement, there are several options. Thankfully, most if not all financial institutions in Jamaica have recognized the limitations for self-employed persons and those employed to organizations that don’t offer pension plans. If you check with your preferred bank or any other financial entity, they will likely introduce you to a plan that is designed to take your earning capacity and cost of living into consideration and also seeks to secure your financial future. One such option is the Approved Retirement Scheme (ARS). ARS is a private pension arrangement that financial institutions offer to members of a similar scheme or a superannuation fund. Members of ARS can contribute as much as 20% of their pensionable salary.
You Have the Keys to Your Financial Future
Employed and self-employed persons equally hold the keys to their financial future. By that, we mean that you can take control of your financial future by tapping into other financial opportunities to secure a comfortable retirement. Here are a few suggestions:
5 Things Self-Employed People Can Do For a Financially Secure Retirement
- Dividend Earning: If you are a confident risk-taker, you can consider investing in stock/shares in companies listed on the stock market. Click here for the Jamaica Stock Exchange.
- Property Rental/Sales: Invest in properties for future rental/sale earning opportunit
- Forex Trading: Learn and practice how to trade foreign exchange (Forex Trading).
- Capital Gains: Acquire assets that show a high probability of an increase in value. You will be able to leverage financial stability from the increase in the value of your assets.
- Royalty: If you are creatively inclined, you can create content that will earn you royalty in the future, such as audio or written content.
So, if you’re self-employed, you need not worry that you will spend your retirement years in poverty. Get in touch with the financial institution of your choice and start securing your financial future today.
Are you self-employed? Have you started planning for a financially secure retirement? Please share with us; we would love to hear your ideas.
#retirement #pension #financialplanning #stocks #jamaicastockexchange
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