GSIS retirement benefits

The Government Service Insurance System or GSIS is for government employees while the Social Security Service is for non-government members. Government employees who are members of the GSIS will receive their retirement benefits in accordance with their qualifications.

The GSIS listed the four retirement modes available to government employees.

Those who were in the service on or before May 31, 1977 may avail of retirement benefits under RA 660, RA 1616, PD 1146 or RA 8291, while those who entered government service after May 31, 1977 may avail of retirement benefits under PD 1146 or RA 8291.

Retirement Under RA 8291
This retirement mode provides two options: The Lump-sum plus Age Pension and the Cash payment plus Pension.
1. The retiree must have rendered at least 15 years of service and must be at least 60 years of age upon retirement.
2. He/she must not be a permanent total disability pensioner.
There are 2 options to choose from:
1. Lump-sum and Old Age Pension (Option1) Lump -sum equivalent to 60 months of the Basic Monthly Pension (BMP) payable at the time of retirement, and an old age pension benefit payable monthly for life, if the retiree is still living after the 5 year guaranteed period.
2. Cash payment and Basic Monthly Pension (Option2)Cash payment is equivalent to 18 times the Basic Monthly Pension (BMP) payable upon retirement and monthly pension for life payablefrom date of retirement.

Retirement under Presidential Decree 1146
The retirement mode applicable if you have been in service after May 31, 1977 but before June 24, 1997.
The retiree must have rendered at least 15 years of service, regardless of age. If retiree is below 60 years old upon retirement, he/she may avail of retirement benefits only upon attaining his 60th birthday.
The benefit is any of the following:
1. Basic Monthly Pension (BMP) For those who are at least 60 years of age and have rendered 15 years of service. The basic monthly pension is guaranteed for 5 years. After the 5-year guaranteed period, he/she will receive a basic monthly pension for life. A retiree may request for the payment in lump-sum of the Basic Monthly Pension for the guaranteed period of 5 years at a discounted rate of not less than 6%.
2. Cash Payment (CP)For those who are at least 60 years of age and has rendered at least 3 years but less than 15 years of service. The cash payment shall be equal to 100% of the Average Monthly Compensation (AMC) for every year of service.

Retirement under Republic Act 660
The retirement mode applicable if you were in the service on or before May 31, 1977.
1. The retiree's last 3 years of service prior to retirement must be continuous, except in cases of death, disability, abolition, and phase- out of position due to reorganization.
2. His/her appointment status must be permanent in nature.
3. He/she must meet the age and service requirements under the "Magic 87" formula
4. The maximum monthly pension for those above 57 years old shall be 80% of the Average Monthly Salary (AMS) received during the last 3 years immediately preceding retirement. The Maximum pension for those aged 57 and below shall be 75% of the AMS
The benefit is any one of the following:
1. Automatic Pension. Retirees below 60 years old shall be qualified to a monthly annuity guaranteed for 5 years with the option to request for a one-year lump sum every six months. If the retiree is still living after the 5-year guaranteed period, he/ she shall be entitled to a monthly pension for life.
2. Initial three-year lump sum/ For those who are at least 60 years old but less than 63 years on date of retirement, the benefit is a 3-year lump sum. The subsequent two -year lump-sum shall be paid to the retiree on his 63rd birthday. If the retiree is still living after the 5-year guaranteed period, he shall be entitled to a monthly pension for life.
3. Five-year lump sum. Available to those who are at least 63 years of age or over on the date of retirement. If still living after the 5-year guaranteed period, the retiree shall be entitled to a monthly pension for life.

Retirement under Republic Act 1616 or Gratuity Retirement Benefit
The retirement mode applicable if you were in the service on or before May 31, 1977.
1. The retiree must have rendered at least 20 years of service regardless of age and employment status.
2. His/her last 3 years of service prior to retirement must be continuous, except in cases of death, disability, abolition or phase out of position due to reorganization.
The benefits are:
1. Gratuity payable by the last employer based on the total creditable service converted into gratuity months multiplied by the highest compensation received.
2. Refund of retirement premiums consisting of personal contributions of the employee plus interest, and government share without interest, payable by the GSIS.
If your years of service to the government do not meet the required number of years under a certain retirement law and you have enough number of years service in the private sector to compensate/substitute for the service requirement, you have the option to apply for retirement under the Portability Law (RA 7699).

So for those government workers who are now contemplating retirement or are nearing their retirement age, its time to start financial planning.