How expats in UAE can take advantage of a risk-free golden pension?
A top official in the UAE has claimed (about golden pension) that expats, who account for 89% of the country’s population, will be the primary beneficiaries of a new pension plan introduced this week. Employees of registered corporations will be aided in their retirement planning by the Golden Pension Plan.
Companies can make contributions in lump sums or regular payments, either directly from employees or on their behalf, in certain circumstances (such as retirement, termination of employment, etc.). The contributions will deposit into the Golden Pension Plan following the agreement’s provisions. Any profits or incentives will distribute to the firm or its employees as the company sees proper. National Bonds will manage the fund, and its money will be invested in a variety of sharia-compliant, low- to medium-risk asset classes. During the signing procedure, these zones are settled upon in advance with the corporate office.
According to the company’s allocation of the contributed cash, Sukuks (savings bonds) would create under employees’ accounts with National Bonds. Redemption of the Sukuks issued under this product is restricted. It can only start at the request of the issuing business.
The employee may see the amount invested, but redemptions and profits are at the company’s choice. Furthermore, the company can return a portion of the gratuity with the employee’s permission.
Is there a restriction on who can join for Golden Pension?
As of right now, the scheme is open to foreigners who work for companies that have joined up with National Bonds.
They are free to put away as little as AED100 each month and stand to make a profit off of their savings. Together with the earned gratuity granted by their company, these savings can use as a retirement fund.
Gratuity is a legal requirement in the United Arab Emirates, therefore all businesses must offer it to their staff.
Employees gain peace of mind through participation in and funding the Golden Pension Plan. Furthermore, they will increase the bonus payout via investment returns.
How do you disperse your company’s earnings?
Investments through National Bonds can earn “very competitive returns” compared to other regional and beyond options.
The Golden Pension Plan’s profits will be distributed every three months, with the company’s initial investment’s allocation and distribution dates determined.
When questioned if beneficiaries have the right to request the accumulated money in times of emergency, the official answered the corporation has redemption control of the Golden Pension Plan.
Each quarter, employees have the chance to win an AED1 million grand prize.
There are AED35 million incentive scheme at National Bonds. Two lucky winners would receive AED1 million every three months. It gives away more than AED423,000 prizes each year, including special awards for women, young people, and consistent savers.
All rewards program awards are open to Golden Pension Plan participants without any minimum balance requirement with double the odds per Sukuks” once an employee has registered for the program. If you keep saving, your chances can get up to four times better.
Quick Plan
A “huge segment” of the working population seeks a “far simpler pension solution vs. what asset management or insurance companies are delivering,” according to the officer’s findings.
Employers can give their workers cheap health insurance in an easy-to-handle package through Golden pension plan.
Alternative cost-cutting measures
The Global Pension Plan is only available to workers at companies registered with the National Bonds. However, other companies often offer their own “Global Savings Club” as an alternative. Employees can set up voluntary monthly bank deductions as part of the strategy to save for emergencies. The minimum monthly contribution is AED100, the same as the Golden Pension Plan.
The club has successfully obtained a significant contribution from these employees who choose to construct their safety net in addition to their gratuity payments.
Should foreign workers rely so much on tips?
Employers normally do not allow redeeming one’s end-of-service dues. Each employee should, therefore, establish a separate savings plan that allows for quick access to funds in the event of a financial emergency. Before it’s too late, everyone should use their savings to better themselves academically, make the most of the chances presented to them now, and lay the groundwork for a stable and secure future.
Covid-19 outbreak all businesses. This is a valuable experience that will help us reevaluate our priorities. Retire planning is often put on hold due to the hectic nature of modern life. It’s often overlooked, yet it’s a major factor in any financial planning discussion.
In the event that you are interested in receiving expert advice, please do not be reluctant to call our Business Consultant. If you have any questions, please do not hesitate to get in touch with us by e-mail at info@crosslink.ae or by phone at +971 4 321 6631.
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