How to Invest in Pag-IBIG MP2 Program: An Ultimate Guide


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The Modified Pag-IBIG II or MP2 is an optional savings scheme for members who want to save more and earn higher dividends on top of their regular Pag-IBIG savings.

The HMDF invests the funds collected from the Pag-IBIG MP2 mostly in its housing loan program, as well as its short-term loan programs. Funds grow through interest payments from borrowers. The rest is invested in corporate bonds, time deposits, and government securities.

Whether you’re a first-time investor or an experienced one who wants to add Pag-IBIG MP2 investment to your portfolio, this guide should get you started.

READ: Pag-IBIG Contribution Table (with Detailed Computations and Explanations)

Table of Contents

Who can save under MP2?

You can open a Pag-IBIG MP2 account if you belong to any of these groups:

  • All active Pag-IBIG members, regardless of monthly income.
  • Former members or pensioners, regardless of age, who have paid at least 24 monthly contributions before retirement.

If you’re not a Pag-IBIG member yet, you must register first and pay your monthly contributions to be considered an official member.

If you’re a former member who’s qualified for the MP2 program, you can simply proceed with your MP2 enrollment.

 

Why should you open a Pag IBIG MP2 account?

MP2 enrollment is not required for Pag-IBIG members, but doing so will be beneficial for you in the long run.

Here are five good reasons to start saving under the Pag-IBIG MP2:

 

1. Above-market dividend rates.

The most compelling reason to save under MP2 is its above-market annual dividend rates.

In the past few years, MP2 dividend rates have grown steadily, averaging at 6.96% from 2015 to 2017.

For 2018, the Pag-IBIG Fund declared the MP2 dividend rate at 7.41%. Meanwhile, the declared MP2 dividend rate in 2019 is 7.23%.

pag ibig mp2 dividend rate

Simply put, the MP2 is more profitable than the regular Pag-IBIG savings program. MP2 dividend rates even surpass the average interest rates of investment products from commercial banks in the Philippines.

With the HDMF’s record-breaking financial performance year after year, it’s expected to maintain the MP2 program’s remarkable dividend rates.

 

2. An easy, affordable, and flexible way to save.

Under the MP2, you need to save only at least Php 500 as an initial deposit and as a monthly deposit should you decide to remit every month thereafter.

It makes saving money easy on the budget, especially for low-income earners.

The MP2 also offers flexibility on how often you want to save. 

You can choose to save every month if your budget is tight. Alternatively, you can deposit a higher amount in a lump sum into your MP2 account, so you don’t have to remit monthly. For example, you can pay Php 30,000 as a one-time remittance instead of paying Php 500 every month for five years.

READ: Best Way to Invest in Pag-IBIG MP2: Monthly, Annual, or Lump Sum (One-Time) Payment?

You also have the option to receive your dividend earnings through either annual payout or compounded savings. 

If you choose to receive your dividend via annual payout, it will be credited every year to your enrolled bank account with Pag-IBIG. But with compounded earnings, you’ll have to wait until the five-year maturity period before you can receive all your dividend earnings.

 

3. Government-guaranteed and tax-free earnings.

Unlike other investment vehicles, there’s no risk of losing your savings under MP2 because they’re fully guaranteed by the government. 

However, dividend rates change per year, depending on the HDMF’s financial performance. The worst-case scenario would be getting back only your principal (the actual amount saved) without a profit, according to Pag-IBIG Fund President and CEO Acmad Rizaldy Moti.

 

4. Short-term to medium-term investment.

The MP2 program allows you to access your funds more quickly (with a five-year maturity period) than the regular Pag-IBIG savings program and other long-term investment vehicles (with maturity periods ranging from 10 to 20 years). 

This means the Pag-IBIG Fund will hold your MP2 savings for five years. After that period, you can withdraw all your savings or let it keep earning dividends for another two years.

 

5. Save as much as you want.

There’s no limit on the amount you can save under MP2.

Just remember that the minimum amount you can save is Php 500. You may increase this during the next few months (e.g., Month 1: Php 500; Month 2: Php 5,000; Month 3: Php 10,000; and so forth).

However, it should be noted that there’s no penalty for no deposit. The Php 500 minimum deposit mentioned here only applies if you decide to remit during any particular month. So you basically have three options when determining how much you can save per month: 0, Php 500, or any higher amount.

Because there’s no penalty for no deposit, you can save anytime you want, whether it’s monthly, twice a month, quarterly, or once by paying a one-time lump-sum deposit.

You may also deposit a million pesos! You’ll have to issue a personal check or manager’s check, though, if you’ll save Php 500,000 or higher.

You can also enroll and maintain as many MP2 savings accounts as you want. This feature is great for meeting various financial goals. For example, you can have an MP2 account for starting a small business, another account for funding your child’s college education, and so on.

 

What is an MP2 dividend and how is it computed?

A dividend is an amount that the Pag-IBIG Fund pays out to its members who invest in the MP2 program.

Dividend earnings are tax-free, which means you’ll receive the full amount without having to pay the 20% final withholding tax.

To compute your MP2 dividend, multiply the dividend rate for the applicable year by your average monthly balance.

Here’s the formula for MP2 dividend computation:

Dividend = Dividend rate x Average monthly balance

Calculating the MP2 dividend is not as simple as it looks, though.

Before proceeding with the computation, it’s important to understand first what the dividend rate and the average monthly balance mean.

The dividend rate is the interest rate based on the Pag-IBIG Fund’s annual net income. The Fund usually announces the dividend rate for a particular year in the first or second quarter of the following year through a news release on the Pag-IBIG website.

For instance, the dividend rate for 2018 is 7.41%, which the Pag-IBIG Fund declared in April 2019.

Meanwhile, the average monthly balance refers to the average of the MP2 savings you’ve accumulated by the year-end. To determine your average monthly balance, get your total cumulative savings for the year and then divide it by 12 (months).

For easier calculation, record your monthly MP2 savings into an Excel file or Google Spreadsheet and then get their average.

Let’s say you’re saving Php 500 per month from January to December 2020. Plotted on a spreadsheet, your cumulative savings look like this:

pag ibig mp2 dividend computation

The total cumulative savings for 2020 is Php 39,000. Divide that by 12, and you’ll get Php 3,250. That’s your average monthly balance.

An easier way to compute the average monthly balance is to use the AVERAGE function in Excel or Google Spreadsheet, which yields the same amount: Php 3,250.

At this point, you can already compute the dividend for the year 2020 based on a dividend rate of 7.5% (the rate the Pag-IBIG Fund always uses in its sample dividend computations).

0.075 (dividend rate) x Php 3,250 (average monthly balance) = Php 243.75 (dividend for 2020)

To compute your dividends for the next four years, simply repeat all the steps above.

If you avail of the compounded savings option, don’t forget to add the dividend amount from the previous year to the cumulative savings in January of the following year.

But if you avail of the annual dividend payout option, don’t add the dividend amount from the previous year to the current year because it’s paid out to you every year.

For your quick reference, the table below from the Pag-IBIG Fund shows the annual dividend payout over a five-year period if you pay Php 500 monthly to your MP2 account. The second table, on the other hand, shows how much you can earn if you choose to keep your dividends in your account within the same period and use the power of compound interest.

pag ibig mp2 annual dividend payout

pag ibig mp2 compounded savings

 

Why is the dividend rate of Pag-IBIG MP2 so high?

Historically, MP2 dividend rates have been on an upward trend. Since 2016 up to present, the rates have never gone down below 7%.

pag ibig mp2 dividend rates

While these figures seem too good to be true, there’s no reason to worry or doubt as to why the Pag-IBIG MP2 dividend rates are “too high.”

The Pag-IBIG Fund’s strong financial performance over the years has pushed up the MP2 rates. The government agency attributes its solid financial standing to its operational efficiencies and strong housing loan payment collections.

Because the Pag-IBIG Fund invests 70% of its investible funds in its housing loan program, people investing in MP2 earn from the interest payments of housing loan borrowers.

Also, MP2 dividends come from at least 70% of the Pag-IBIG Fund’s annual net income, which has seen steady growth for the past six years. In 2019, the Fund recorded a net income of Php 34.37 billion—its highest ever.

An impressive annual financial performance translates to higher dividend earnings for MP2 accountholders.

 

How to enroll in the MP2 program.

There are two ways to open an MP2 savings account: applying directly at any Pag-IBIG office or using the online MP2 Enrollment System.

 

Option 1: Walk-in MP2 registration at a Pag-IBIG branch.

  1. Submit a completed Modified Pag-IBIG II Enrollment Form at the nearest Pag-IBIG branch.
  2. After encoding your information, the officer will issue an account number for each of your MP2 accounts. You’ll use the MP2 account number/s to remit your savings.
  3. If you want to pay your first monthly MP2 savings right away, inform the Pag-IBIG officer. You’ll be given a queue number for the payment.
  4. When your number is called, proceed to the cashier and pay the amount you indicated on your MP2 enrollment form. Receive your official receipt.

 

Option 2: Online MP2 enrollment.

Online registration for MP2 is quicker than enrolling manually, as you won’t have to fill out the form at the Pag-IBIG office. However, you’ll still need to go to the nearest branch to complete your MP2 enrollment.

Here’s how to enroll in the MP2 program online:

  1. Go to the Modified Pag-IBIG 2 Enrollment System.
  2. Type your Pag-IBIG MID number, surname, first name, and birthdate in MM/DD/YYYY format. Then enter the code as it appears on your screen. Click the Submit button.

pag ibig mp2 3

 

  1. Fill out the online form. The fields for Pag-IBIG MID no., Name, Date of Birth, Present Home Address, and E-mail Address are already pre-filled, so no need to fill them out (On the screenshot below, the personal details are concealed for privacy purposes).  Make sure to enter your Monthly Income and Desired Monthly Contribution—these are required fields.

pag ibig mp2 4

 

  1. Read the terms and conditions below the online enrollment form. Then enter the code you see. Finally, click the Submit My Application button.

pag ibig mp2 5

 

  1. A page confirming your successful MP2 enrollment will appear. Take note of your MP2 account number on the upper right corner. The page also contains your accomplished enrollment form (Again, personal details are concealed on the screenshot below).

pag ibig mp2 6

 

  1. Read the terms and conditions. Write your name and sign at the bottom of the page. Write down the date as well.  Click the link at the bottommost part of the page to print your MP2 enrollment form. You may save it first as a PDF file for printing later. If you’re an employee, print an additional copy and submit it to your HR staff or employer, so you can remit your MP2 savings via salary deduction.

pag ibig mp2 7

 

  1. Optional: If you want to open another MP2 account, repeat steps 1 to 6.
  2. Visit the nearest Pag-IBIG office and submit the printed copy of your MP2 enrollment form/s.
  3. If you want to pay your first monthly MP2 savings right away, inform the Pag-IBIG officer. You’ll be given a queue number for the payment.
  4. When your number is called, proceed to the cashier and pay the amount you indicated on your MP2 enrollment form. Receive your official receipt.

Go back to the main article: How to Compute Your Pag-IBIG Contribution: A Complete Guide to Contribution Table and Payment

 

How to make the most out of your MP2 investment to achieve important life goals.

Here are the different ways to maximize your MP2 investment based on your goal.

1. For long-term investment (10+ years).

If you’re in your 20s or 30s, you have more than 10 years to invest your money for any long-term financial goal, like building your retirement fund or buying your dream home.

For this, your strategy should be growing your money over time. Here’s how to do it through Pag-IBIG MP2 savings:

  • Open an MP2 account with the compounded dividend option.
  • Make a one-time MP2 contribution (ideally not less than Php 30,000).
  • Withdraw your earnings at the end of the five-year maturity period.
  • Re-invest your earnings by opening a new MP2 account.
  • Repeat the process for another five years and so on.
  • Withdraw your total cumulative savings and dividends when you’ve reached your target earnings.

 

2. For capital preservation.

If you’re in your retirement age (or approaching it), you can’t take investment risks anymore. So instead of investing in the long-term, your goal is to preserve your capital so that your money doesn’t lose its value to inflation.

Pag-IBIG MP2 can help you achieve that goal through the annual dividend payout option, which allows you to receive dividends per year while keeping the value of your investment. Here’s how to do it:

  • Open an MP2 account with the annual dividend payout option.
  • Make a one-time MP2 contribution (The higher the amount, the higher return you’ll get).
  • Receive your dividend every year through your Pag-IBIG Loyalty Card Plus or the bank account you registered in your MP2 account opening.
  • Withdraw your cumulative savings once your MP2 account reaches the five-year maturity period.
  • Re-invest your earnings by opening a new MP2 account.
  • Repeat the process for another five years and so on, as long as you need a steady stream of income.

 

3. For multiple medium-term investment goals.

The Pag-IBIG Fund allows opening as many MP2 accounts as possible. Take advantage of this feature if you have several goals to achieve for the next five years or so.

The optimal number of accounts will depend on the expenses you’re preparing for. Each account will be created for a specific purpose, such as travel fund, tuition fund, wedding fund, home/vehicle purchase, etc.

Here’s how to maximize your MP2 investment for your medium-term goals:

  • Open two or more MP2 accounts at the same time with the compounded dividend option. If your budget is limited, you can open one account per year for the next two years or more.
  • Make a one-time contribution per MP2 account.
  • Withdraw your earnings upon maturity of each account.

 

Tips and Warnings.

  • If you choose to save monthly, the minimum amount you can remit each month is Php 500. Since there’s no limit to how much you can save, you can remit anything higher than Php 500 initially and during the succeeding months. For example, you can save Php 500 during the first month, remit Php 20,000 during the next, Php 10,000 in the third month, and so forth.
  • Payments don’t need to be consistent. You can save once a month, twice a month, every quarter, or just once through a lump-sum deposit.
  • You can even skip a payment without incurring any penalty. Just to be clear, the Php 500 mentioned previously is the minimum amount you can contribute should you decide to remit during any particular month. But in case you forget to remit or you have nothing to remit at all, rest assured your account will remain active. In other words, you have three options when deciding how much to remit to your MP2 account per month: 0, Php 500 or higher. 
  • The 5-year lock-in period starts from the time you make your first deposit, not when you generated your Pag-IBIG MP2 number from the website.
  • Upon application, you can choose to receive either annual dividends or leave your savings untouched for the next 5 years so you can earn more though compounded savings. The annual dividends are paid out to members through the Pag-IBIG Loyalty Card Plus.
  • To quickly check whether your latest payment already reflects in your Pag-IBIG MP2 account, create a Virtual Pag-IBIG accountOnce you already have an account, follow the instructions here to view your updated record of contributions or MP2 deposit history. On average, it takes 3-5 days for the payment to finally reflect in your account.
  • If you’re paying through a third-party payment channel, always keep a proof of your transaction like the actual receipt or screenshot showing your payment has been received (if you’re using a mobile wallet like GCash).

Frequently Asked Questions.

1. When should I pay my Pag-IBIG MP2 savings?

2. What is the best way to invest in Pag-IBIG MP2? Is it through monthly, annual, or one-time savings?

3. How can I pay my Pag-IBIG MP2 savings?

4. Which is better: increase my regular Pag-IBIG contributions or save my money under MP2?

5. Is it better to cash out Pag-IBIG MP2 dividends every year or keep them invested for the next 5 years?

6. When can I withdraw my MP2 savings?

7. How can I claim my MP2 savings?

8. How can I check or monitor my Pag-IBIG MP2 contributions?

9. Can I re-apply for a new MP2 Savings once my MP2 Savings matures?

10. Where does Pag-IBIG invest my MP2 contributions?

11. How can I open a Pag IBIG MP2 account if I’m an OFW working/living abroad?

12. What is the difference between Pag IBIG MP2 and SSS PESO Fund? Which one is a better government savings program?

13. What is the best and cheapest way to remit/send money to your Pag-IBIG MP2 account?

 

About the Author.

Venus Zoleta is an experienced writer and editor for nearly 15 years, covering topics on personal finance, travel, government services, and digital marketing. Her background is in journalism and public relations. In her early 20s, she started investing and purchased a home. Now, she advocates financial literacy for Filipinos and shares her knowledge online. When she’s not working, Venus bonds with her pet cats and plans her next travel adventure.

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112 thoughts on “How to Invest in Pag-IBIG MP2 Program: An Ultimate Guide

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  6. Hello, I just want to ask regarding Pag ibig MPll, I was registered already, and paid 1 month only way back year 2015, whst will I do, so that I can invest in MPII?

    1. You must be an active Pag-IBIG member who pays the regular contributions regularly. The list of qualifications is already discussed above (see “Who can save under MP2?”).

  7. Dating member ako ng Pag ibig nais ko po ituloy, ngayun sa ibang bansa ang trabaho ko, pano at ano ang gagawin ko.
    Salamat sa pagtugon.

    1. First, you need to reactivate your Pag-IBIG membership: https://filipiknow.net/reactivate-pag-ibig-membership/

      Once you’re regularly paying your regular contributions again, you can now enroll in Pag IBIG MP2: https://filipiknow.net/how-to-open-pag-ibig-mp2-for-ofw/

    1. You can only assign beneficiaries/heirs for your Pag-IBIG Savings I/Provident Savings. I’m not sure if these will be the same beneficiaries who can claim your MP2 savings in case you die. Better ask Pag-IBIG directly.

  8. Dear sir,
    How can I have a PAGIBIG MID. I only have my original,light yellow ID NUmber Card. Can I use this yellow card in enroling online for an MP 2 Savings? I hope you could reply the soonest possible time. Thank you.

  9. Hi. Do I need to go to the nearest PAGIBIG branch to be officially registered to MP2? Even though I enrolled online?

  10. Hi im planning to pay online. But may covered period po sya. Ano po ibig sabihin nun? Di ko kasi alam ilang months ang ilalagay ko or para ano sya.

  11. Hi, is it possible to contribute more that what was indicated in the application? Say, I put in 5K per month in the application, so that makes 300K for 5 years. Can I deposit a total of 500K, or am I limited to 300K only and just open another account for the excess?

    1. Yes, you can remit more than Php 5,000 per month. There’s no limit to how much you can contribute although you need to issue a check if you want to remit Php 500,000 or higher.

  12. hi,
    i have registered online and was given an MID no. I have mp2 account.The problem is everytime I try to make a payment online to my mp2 account ,it will not let me.I clicked verify but it will not go forward.Im getting frustrated now.
    please help.
    thank you

  13. I want salary deduction for my pag ibig 2,’but our agency said that there is no such thing as salary deduction in pag ibig 2..im from dep ed department..what is the code used for salary deduction? Pls help me..

  14. GOOD day! Can I open a separate MP2 account aside from my company’s monthly contribution ? Thank you.

  15. Hello nagenroll ako ng mp2 thru OL last fri, ok lang po ba kung hindi ako mismo ung magsubmit at magbayad ng initial dep/app form sa PAG-IBIG branch since I have work po and pinili ko wag mag salary deduct. Thank you.

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