Who is going to pay your pension, the IMSS or the Afore? Everything you need to know

In Mexicothe pension system has two regimes, 73, which is granted to people hired under the Social Security Law in force until June 30, 1997; and the second, the pension for regime 93, modality that applies to you if you started quoting on or after July 1, 1997.

So if you have wondered Who is going to pay you a pension, the IMSS or the Afore?let us tell you that the answer depends on the system in which you are contributing, because, as we already said, in Mexico two existing pension schemes coexist.

So if you’re under the Social Security Act v.valid until June 30, 1997, known as regime 73, he Mexican Social Security Institute (IMSS) will be the one who takes charge of the payment of your Unemployment pensions in Advanced Age or Old Age, with the support of the Federal Government.

However, if you are under the Current Social Security Law, that is, the 97 regime, you have more options for the payment of your pensions. In this case, the Unemployment pensions in Advanced Age or Old Age can be paid through the IMSS, an insurer with an agreement with the Institute or a Retirement Fund Administrator (Afore).

How do the Afores work?

The Aforesas their name indicates, are retirement fund managers that are in charge of investing your savings in different financial instruments, such as shares, bonds and mutual fundsso that they generate returns and you can obtain a greater benefit at the time of your retirement.

These institutions offer various investment options, depending on the profile of each person and their level of risk. That is, you can choose between conservative options, moderate or aggressivedepending on your situation and expectations.

Why opt for an Afore?

One of the main advantages of opting for a AFORE is that you can have greater control over your retirement savings, since you can choose the institution that best suits you and the investment option that best suits your needs.

In addition, the Afores are regulated by the National Commission of the Retirement Savings System (Consar)which guarantees that your savings will be safe and will be managed in a transparent and responsible manner.

Another advantage is that the Afores they allow you to make voluntary contributions, that is, you can save more than what you are entitled to by law and thus increase the amount of money you will receive during retirement.

You should also know that some Afores offer additional benefit programs, such as discounts on products and servicesas well as personalized financial advice.

So if you’re thinking your retirement money will manage an Aforethe best thing will be that you inform yourself and compare the percentage of return offered by the various companies immersed in the market.