UAE Golden Pension Scheme: What You Need to Know
UAE Golden Pension 2023: The Ultimate Guide to Retirement Benefits for Expats in UAE
Are you looking for a reliable retirement plan that can offer you a sense of financial security and stability in your golden years? If so, the UAE Golden Pension scheme might be just what you need. In this guide, we will cover everything you need to know about the UAE Golden Pension scheme and how it can benefit you as an expat worker in the UAE.he UAE Golden Pension Scheme is an excellent option to consider. In this article, we’ll provide a comprehensive guide to the UAE Golden Pension Scheme, including eligibility criteria, contribution requirements, benefits, and more.
What is the UAE Golden Pension Scheme?
The UAE Golden Pension scheme is a retirement plan designed specifically for expat workers in the UAE. It is a financial scheme that allows expat workers to invest all of their accumulated end-of-service benefits or a portion of it to create a lump sum that can provide a stable income during their retirement years.
The UAE Golden Pension Scheme is a retirement savings scheme that was launched in 2018 by the UAE government. The scheme aims to provide residents in the UAE with a secure and comfortable retirement by offering a range of pension plans.
How does the UAE Golden Pension scheme work?
The National Bonds’ Golden Pension scheme provides customizable and flexible solutions to businesses with a high number of workers. Companies can sign up for the scheme by investing all or a portion of the end-of-service benefits accumulated over the years for their employees. Additionally, expat employees can also contribute at least AED 100 per month of their basic salary, which can be availed in addition to the earned gratuity provided by their organizations. Through the National Bonds app, employees can observe their savings in real-time.
Employees may withdraw money from the National Bonds’ pension scheme only when the company they’re working for permits them to do so. However, this does not apply to individual contributions which they can withdraw whenever they like.
Who is eligible for the UAE Golden Pension Scheme?
All expat workers employed within the private sector in the UAE are eligible to enroll in the Golden Pension scheme. As per the UAE government, all individuals employed by both the government and private sectors are eligible for pensions and other retirement benefits after reaching the retirement age of 49 or serving a total of 20 years.
Eligibility criteria for the scheme
To be eligible for the UAE Golden Pension Scheme, you must meet the following criteria:
- Be a resident in the UAE
- Be over 18 years old
- Have a valid Emirates ID
- Have a source of income
Types of pension plans available
There are three types of pension plans available under the UAE Golden Pension Scheme:
- Fixed Benefit Plan: This plan provides a fixed monthly benefit to the plan holder after retirement, which is based on the contribution amount and the length of the contribution period.
- Fixed Contribution Plan: This plan allows the plan holder to make fixed contributions towards their pension plan. The retirement benefit is then calculated based on the contributions made and the investment returns earned on those contributions.
- End of Service Benefit Plan: This plan allows employers to make contributions towards their employees’ retirement savings. The plan holder can choose to receive the benefit as a lump sum or as a monthly income.
Contribution requirements
The contribution requirements for the UAE Golden Pension Scheme are as follows:
- The minimum monthly contribution is AED 1,000
- The maximum monthly contribution is AED 50,000
UAE Golden Pension scheme for expats
The objective of the UAE Golden Pension scheme is primarily to uphold the rights of expat workers and employees. The scheme provides expats with the opportunity to increase their savings and improve their end-of-service benefits which will prove beneficial in future-proofing their financial and retirement plans.
The UAE Golden Pension scheme is designed to offer affordable monthly contribution rates with competitive profit rates. It also provides transparency regarding profit calculation and holdings, as well as visibility regarding end-of-service benefit amounts, profit returns, and winnings.
Benefits of the UAE Golden Pension Scheme
The UAE Golden Pension scheme offers a range of benefits to expat workers in the UAE, including:
- Enhanced Financial Security: The scheme provides expat workers with the opportunity to increase their savings, improve their end-of-service benefits, and create a lump sum that can provide a stable income during their retirement years.
- Customizable and Flexible Solutions: The National Bonds’ Golden Pension scheme provides customizable and flexible solutions to businesses with a high number of workers, making it easier for employers to enroll their workforce in the scheme.
- Affordable Contribution Rates: The scheme offers affordable monthly contribution rates with competitive profit rates, making it an accessible option for expat workers with varying budgets.
- Transparent Profit Calculation: The scheme provides transparency regarding profit calculation and holdings, giving expat workers peace of mind and a sense of control over their investments.
- Visibility of Earnings: The scheme provides visibility regarding end-of-service benefit amounts, profit returns, and winnings, making it easier for expat workers to keep track of their investments and earnings.
The UAE Golden Pension Scheme offers several benefits, including:
- Tax benefits for residents in the UAE
- Investment options available for pension plans
- Guaranteed retirement income for life
How to apply for the UAE Golden Pension Scheme
The process for applying for the UAE Golden Pension Scheme is straightforward. Here’s a step-by-step guide to help you through the process:
- Visit the official website of the UAE Pension Fund
- Fill out the application form
- Submit the required documents
- Make the first contribution payment
The required documents for the application process include a copy of your Emirates ID, a copy of your passport, and proof of income.You can also apply for the UAE Golden Pension Scheme online through the Pension Fund Authority website. The online application process is simple and can be completed in a few minutes.
Required documents
- Emirates ID card
- Passport copy
- Residency visa copy
- Salary certificate
Application process
- Visit the Pension Fund Authority website and create an account.
- Fill out the application form with your personal details and employment information.
- Upload the required documents.
- Submit the application form and wait for approval.
Drawbacks of UAE Golden Pension Scheme
While the UAE Golden Pension Scheme has many benefits, there are also some drawbacks that you should consider before joining the scheme:
Limited investment options
The scheme only allows investment in government-approved investment options, which may limit your potential returns.
No early withdrawal allowed
You cannot withdraw your pension before the retirement age of 60, except in the case of disability or death.
Inflation risk
Inflation can erode the value of your pension over time, reducing its purchasing power.
Conclusion
The UAE Golden Pension scheme is a reliable retirement plan that offers a range of benefits to expat workers in the UAE. By enrolling in the scheme, expat workers can increase their savings, improve their end-of-service benefits, and create a lump sum that can provide a stable
What is the minimum age requirement to apply for UAE Golden Pension Scheme?
To be eligible for the UAE Golden Pension Scheme, you must be a UAE national or resident and at least 18 years of age. There is no maximum age limit to apply for the scheme.
Can non-UAE citizens apply for the scheme?
Yes, non-UAE citizens who are residents of the UAE can apply for the UAE Golden Pension Scheme. However, they must meet the same eligibility criteria as UAE nationals and contribute to the scheme for at least five years to be eligible for the pension benefits.
How much is the contribution rate for the scheme?
The contribution rate for the UAE Golden Pension Scheme is 5% of the employee's basic salary, with a matching contribution of 15% from the employer. The total contribution rate of 20% is higher than many other pension schemes and provides significant benefits for the employee upon retirement.
Is it mandatory for employers to offer the scheme to their employees?
As of now, it is not mandatory for employers to offer the UAE Golden Pension Scheme to their employees. However, the government has encouraged employers to provide the scheme to their employees, and many companies have already started offering the scheme to attract and retain talented employees.
Can I withdraw my pension before retirement age?
No, you cannot withdraw your pension before retirement age under the UAE Golden Pension Scheme. The scheme is designed to provide retirement benefits and financial security for individuals after they reach retirement age. However, there are exceptions to this rule, such as in the case of terminal illness or permanent disability.
What is the golden pension plan in UAE?
The golden pension plan in UAE, also known as the UAE Golden Pension Scheme, is a voluntary retirement savings scheme launched by the UAE government to provide retirement benefits and financial security for UAE nationals and residents. The scheme offers a range of benefits to contributors, including retirement, disability, and survivor pensions, along with a savings component that allows individuals to accumulate savings over time.
Is there any pension scheme in UAE?
Yes, there are pension schemes in the UAE. In addition to the UAE Golden Pension Scheme, the government has also launched other retirement savings schemes, such as the Federal Pension and Social Security Law, which covers federal government employees and their families, and the Dubai Pension and Benefits Fund, which covers employees of the Dubai government and its subsidiaries.
How much is UAE pension?
The amount of pension benefits in the UAE varies depending on the retirement scheme and the individual's contribution. Under the UAE Golden Pension Scheme, the pension benefits are calculated based on the individual's contributions, length of service, and average salary over the final years of employment. The pension benefit can be up to 60% of the individual's final average salary.
What is pension age in UAE?
The pension age in the UAE depends on the retirement scheme. Under the UAE Golden Pension Scheme, the retirement age is 60 years for UAE nationals and residents. However, individuals can retire as early as 50 years of age with a reduced pension benefit.
What is the new pension scheme in Dubai?
The new pension scheme in Dubai is the Dubai Retirement Savings Plan (DRSP), which was launched in 2020 to provide retirement savings options for private sector employees in Dubai. The DRSP is a voluntary scheme that allows employees to contribute a percentage of their salary to a savings plan managed by the Dubai Financial Services Authority.
What is golden pension announced for expats to help boost gratuity?
The golden pension announced for expats is a new retirement savings scheme launched by the Dubai government in 2021. The scheme is designed to help expat workers build up their retirement savings and boost their end-of-service gratuity payments. Under the scheme, expat workers can contribute a percentage of their salary to a retirement savings account, with the employer also making a matching contribution. The scheme is voluntary and is open to all expat workers in the private sector.
