Skip to main content
main content, press tab to continue


We partner with organizations to help with retirement plan set up, actuarial valuations, plan governance and administration services, employee communications and other retirement consulting services.

Contact Us

Corporations strive to strike a balance between providing effective and competitive retirement programs while managing cost and risk. A well-constructed retirement plan can give your organization the financial edge it needs to recruit and retain the best talent, while helping your employees build the retirement savings they need to become financially independent upon retirement.

We are a top provider of retirement consulting and actuarial services in the Philippines. We have unparalleled experience assisting many of the country's largest retirement plan sponsors. Our in-depth knowledge in dealing with various types of pension arrangements, complemented by the breadth and scope of our service team in handling administration work for other countries in Asia Pacific, allows us to consistently deliver best practices and top-notch service quality.

Our capabilities include:

  • Retirement Plan Strategy, Design and Costing
  • Actuarial Valuation for PAS 19R, ASC 715 and Funding
  • Defined Benefit to Defined Contribution Plan Conversion
  • Governance
  • Preparation of Plan Documents for BIR Submission
  • Investment Manager Selection
  • Employee Communication

With our team consisting of qualified actuaries, a Certified Public Accountant (CPA), a Chartered Financial Analyst (CFA), a Chartered Enterprise Risk Analyst (CERA), and seasoned actuarial professionals, we are in the best position to provide these essential services to maximize outcomes for your employees and achieve your business objectives.

Why choose WTW?

  • Global expertise with strong and stable local presence

    Aside from our proven global knowledge and expertise, WTW has a full retirement actuarial valuation team in the Philippines with three certified actuaries available to support you.

  • Your trusted advisor

    We start with your needs and build insights and recommendations based on your own benefits philosophy and objectives. Our aim is also to partner with you for your long-term retirement consulting needs even beyond this engagement.

  • You get one of us, you get all of us

    You get access to the other WTW Philippines’ areas of expertise found in our other lines of business such as Work and Rewards, Employee Experience, Health and Benefits, Risk and Broking.

  • Professional excellence

    We strictly follow a three-layer review process in all our deliverables to ensure the high-quality standard of our deliverables to you.

Why set up a formal retirement plan?

Your competitors are also setting up or have already setup their own plan

Local and multinational companies are setting up their retirement plans to improve their employee benefits as a way to attract and retain key talent.

Based on the 2021 Benefits Design Practices Philippines Report of WTW, 64% of the survey respondents have an existing formal retirement plan. The survey was participated by more than 300 companies from various industries.

Having a retirement plan is slowly becoming the norm in the Philippines, that having one may place your benefits package at par with your competitors.

Retirement benefit is one of the top three reasons why employees stay in their company

Employees are becoming more aware that the statutory retirement benefits provided by R.A. 7641, and the government pension plans, such as SSS and Pag-IBIG, will not be enough to adequately support a comfortable lifestyle upon their retirement.

With the appropriate market positioning of the retirement plan, its benefits can be a powerful retention tool and an effective rewards program that is mutually beneficial to the Company and its employees.

Formal retirement plans enjoy certain tax incentives

Contributions to a formal plan can be used as a tax deductible expense to the company so tax savings of around 25% of contributions can be used for other employee benefits. Retiring employees will also enjoy tax-free benefits and not pay income tax of around 30% of benefits received.

Earnings on the assets set aside for the retirement plan can also enjoy certain tax exemptions, which has the potential to lower the overall expense of the employer and increase the benefit of the employees.

Retirement benefits increase employee engagement

Based on our 2019 Global Benefits Attitudes Survey, 79% of surveyed employees reported that they are highly engaged with their job when the retirement program of the Company meets their needs. This is twice the number compared to employees whose retirement plan does not meet their needs.

Financial wellbeing of employees is gaining importance

In the absence of an employee retirement plan which is also used as a savings program, many companies will not be able to support the financial wellbeing of their employees especially during unprecedented events that result to untimely separation of the employees from the company – e.g., pandemic.

In fact, the pandemic has resulted in many requests from companies for assistance in setting up their retirement plans. In addition, based on the 2020 Asia Pacific Restoring Stability Survey of WTW, 67% stated that they made or plan to make changes to the retirement benefit program as a result of COVID-19.

How to set up a retirement plan

There are essentially two phases in setting up a retirement plan: Plan Design and Plan Implementation.

Under Plan Design Phase, the following activities can be done:

Information Gathering and Advisory Phase

During this phase, the company's philosophy and objectives on benefits are discussed including its goals, rationale and parameters which needs to be considered in choosing a retirement plan design. During this phase, the company needs to understand the different types of retirement plans and their advantages/disadvantages, the procedures for implementing, maintaining and evaluating retirement plans, and an overview of cost components of retirement schemes. Project management and timeline, including the different teams to be involved in the setting up of the plan, are also discussed during this activity.

Market Review

It is important for the company to know how its current retirement practices compare with the other companies in its target market group or even specifc peer groups that it would like its retirement plan to be benchmarked with. A side-by-side comparison of the different features of a retirement plan between the company and its peers will be important in determining an attractive and competitive retirement plan design. It would be good to get access to formal benefit surveys which provide this information. During this activity, the company's benefits philosophy and desired market positioning should be considered including emerging trends and any impending legislation. Based on the results of the Market Review, a high level plan design can already be drafted.

Under the Plan Implementation phase are the following activities:

Plan Design and Actuarial Costing

Using the results of the market review and taking into account the items discussed during the information gathering and advisory phase, a more detailed plan design can be formulated based on market practice of companies in its target market group and desired market positioning. Once a plan design is chosen, the plan can now be costed using actuarial methods.

The cost of a typical retirement plan will be a function of amount of contributions, the size and timing of the eventual benefit payments, actual investment returns (net of taxes and expenses) on fund assets, salary projections and other financial and demographic (e.g. attrition) assumptions. An actuarial analysis is required to take into account the specific characteristics of the employee group covered and company policies such as on the investments of the plan assets.

It is also important that such costings be prepared using a realistic set of actuarial assumptions so that the long-term cost of the plan is approximated in a reasonable manner. Calculations will be based on the current employee data and considers future hires together with an agreed set of financial and demographic assumptions. The different benefits of the retirement plan should be considered in the costing.

Based on the results of the costing, the company can either approve the plan design or make further changes in its plan features depending on its objectives such as the target level of benefits that the plan should achieve.

Actuarial Valuation

An actuarial valuation of the retirement program plan is performed based on Revised Philippine Accounting Standards 19 (PAS19R) to determine the financial impact. The valuation should consider the required liability to meet the minimum mandated benefit, particularly for the Defined Contribution (DC) plans. The actuarial valuation report is a requirement for application for tax qualification. An actuarial valuation of the plan should be performed periodically in order to investigate the plan’s financial position and to recommend a contribution rate to be paid prospectively.

Preparation of Plan Documents

After the company has decided on the benefit provisions to be adopted, a draft of the plan rules are prepared and is reviewed by the company and its legal counsel.

Application for Tax Qualification

Once the plan has been formally adopted, the next step is for the plan to be tax-qualified with the Bureau of Internal Revenue (BIR). The necessary documents must be compiled for submission to the BIR for its approval. When approved, the plan would enjoy the benefits of a tax-qualified retirement plan. Among the documents to be submitted include the plan rules, the actuarial valuation, the Trust Agreement and the Board Approval of the plan.

Investment Manager Selection

The choice of the investment manager is important to ensure that the plan assets are invested properly. A company usually requests for proposals from shortlisted fund managers who then present their capabilities which include information on criteria considered in choosing an investment manager include ownership profile, assets under management and market share, investment staff profile, Investment process, philosophy and strategy, past performance and fees. Critical success factors considered should include business, people and process.

Employee Communication

In order for the employees to appreciate the plan, they must understand it. The company should implement an Employee Communication Plan especially if the retirment plan is being initially established. Communication materials typically include the announcement letter, employee handbook, illustrative benefit projections and the employee presentation itself.

WTW has assisted many companies in setting up their retirement programs. If you would like to get more details on how WTW can assist you, please email us.

Different types of actuarial valuations on retirement plans in the Philippines

In the Philippines, there are typically three types of retirement plans performed depending on the objectives of the actuarial valuation: ASC 715, PAS19R and Funding. The different objectives and features of these valuations are shown below:

ASC 715 Valuation
  • Provides calculation of benefit obligations, net balance sheet, and other disclosure items as prescribed in ASC 715 (USGAAP).
  • Company is accountable for the valuation report. Actuarial consultant prepares the report for the company.
  • Discount Rate used is as prescribed by USGAAP standards and are based on market yields of government securities considering timing and amount of projected benefit payments.
PAS 19R Valuation
  • Provides calculation of benefit obligations including sensitivities, net balance sheet, and other disclosure items as prescribed in PAS 19R (Philippine Accounting Standards).
  • Company is accountable for the valuation report. Actuarial consultant prepares the report for the company.
  • Discount Rate used is as prescribed by PAS19R standards and are based on market yields of government securities considering timing and amount of projected benefit payments.
Funding Valuation
  • Provides information on funded status, solvency position of the Plan, and recommended contribution for the ensuing year.
  • An independent report provided by the Actuarial consultant.
  • Discount rate uses the Expected Return on Assets (EROA) which results in a more realistic value of pension liability

Additional differences between the PAS 19R Valuation and the ASC 715 Valuation are the following:

PAS 19R Valuation ASC 715 Valuation
Actuarial Gains/Losses are accumulated fully in OCI Actuarial Gains/Losses are accumulated under Other Comprehensive Income and an amount is recognized each year as P&L based on “corridor approach”
Full Recognition of Past Service Cost in P&L Past Service Cost amortized over the future working lifetime of the liability
Uses the Discount Rate in determining interest income Uses the EROA assumption in determining interest income
Has different set of triggers for Curtailment and Settlement Accounting (presence of special event)

Would you like to know more about how WTW can perform an actuarial valuation for your retirement program based on your requirements? Email us.

A successful DC case study

This case study shows how WTW was able to successfully set up a Defined Contribution retirement plan for a Global Payments Technology Company with two entities in the Philippines. The company availed of WTW's end-to-end services resulting in a very competitive retirement plan with a high employee participation rate.

  • Company provided only the required benefits of RA7641 putting it at a competitive disadvantage.
  • Company wanted to provide employees with a vehicle to save and use in planning for retirement and to recognize longer service with the Company.
  • Company had no formal plan and was not able to take advantage of benefits of a tax-qualified plan for itself and its employees.
  • Market review and benchmarking conducted by WTW
  • Constant communication and project managements; WTW guided clients with detailed step-by-step process on retirement plan design and costing. Cost estimates per plan design and funding options to facilitate decision-making were provided.
  • Investment Manager Selection process was facilitated by WTW including a detailed summary of the proposals submitted by fund managers.
  • Employee communication sessions highlighted the relevance to employee needs
  • Multi-employer DC retirement plan for its two entities in the Philippines with a competitive plan design compliant with the requirements of the law.
  • Over 80% of employees participating in plan through voluntary employee contributions that are matched by the company up to a maximum amount.
  • Able to get lower fund management fees.
  • Availed of WTW DC Administration including online benefit statements for employees.

Contact us