SNPF 10% Dividend Payout 2017/18

in samoa •  5 months ago

SNPF Dividend Follow-up

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DISCLAIMER: Long rant, will either inspire you OR waste 5 minutes of your life. So scroll down and read on if you dare. Applicable to Samoan residents and contributors to the SNPF Superannuation Fund

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I have verified and confirmed from last FB rant on this bullfuckery of a dividend, that the 3% dividend cash payout (additional to the 7% making it 10% payout this year) does not go in to your 30 June contribution balance and therefore will not receive interest on next years dividend. Very creative stroke by SNPF by the way. I would do the same if I was in their shoes. Anyways...

So what does this mean? If you consider the time value of money, this means, its better to cash out your 3% today than wait until Oct 31. No point keeping it in SNPF since it isn't part of your 30 Jun contribution balance.

What can you do with this 3%? You can still loan half of the 7% dividend via the small loan scheme. Personally, the 3% that I just received from SNPF, I will either:

  1. Pay down your short term/housing/investment loans! If you have one OR all of them, avoid the temptation of withdrawing to spend, rather, put it back into your various loans. This will reduce your loan interest payments (applies also to loans with other institutions apart from SNPF, if any). IF you do not have any of these loan facilities (highly doubtful but awesome nonetheless) then...

  2. Pay down your small loan, apart from the obvious reduction in interest payments, you can then utilise this for future emergency loan requirements using the small loan scheme.

  3. If youre like me, believe in self financial sovereignty and trade crypto, #BuyBitcoin and increase your trading capital #LikeABoss :p

DONT FOLLOW number 3 if you dont understand crypto/blockchain and have no experience in trading/investing, dumb money make no money

And finally, last but not the least...

Number 4! - This is a generalisation and will probably be the majority national psyche... but fuck it, #YOLO, spend that 3% and be a one day millionaire. Give it to the faifeau, its tax free, earn a place in heaven. Do whatever the fuck with your own goddamn money. Its you against the world blah blah blah, next minute 😂

Remember a dollar today is worth more than a dollar tomorrow. So spend/save/invest wisely. Minimise your risk/debt exposure and maximise your gains to ensure a sustainable and stable future of financial security/freedom.

#ThatIsAll #NotFinancialAdvice

UPDATE Post Edit

2.5 (Between 2 and 3)
Withdraw the 3% and add it to your contribution balance. Assuming NO DEBT whatsoever OR you have proper debt management controls in place

NOTE: Taken from FB post, will start to blog more often on Steem and link it back to social media accounts, especially for long rants :)

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What is SNPF?

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SNPF is the Samoa National Provident Fund. Its basically a superannuation/retirement scheme for residents and those employed in Samoa. Contributions to the fund are mandatory at 7% of total wages/salary by the employee with a matching 7% contribution by the employer. Employee can voluntarily add more to their fund (up to $2k WST per month) and use it as a savings investment account. Same applies to employer as a bonus incentive for employee, usually another 3-7%.

One of the features of the fund is that a contributor can loan up to 50% of their contribution at interest rates that are normally offered by local banks. The fund is mandated to pay a minimum dividend of 4% per annum. So far in the last 5 years from memory, the fund has been averaging at least 7% returns, with this year being a first at 10%. There are exceptions especially after a natural disaster when the fund pays out 3-4% to members to assist with recovery.

That is the SNPF in a nutshell. Fortunately it is one of only two options that locals can invest in, as access to trading, stock, FOREX markets are fairly limited. The other option is known as UTOS (Unit Trust of Samoa), basically a mutual type fund of Samoan government investments both local (such as Telecoms companies) and foreign.