May 23, 2024

5 Strategies to Get the Most out of Pag-IBIG MP2


5 strategies to maximize Pag-ibig MP2 savings account

In our first blog, ultimate guide in Pag-ibig MP2, you learned the advantages and disadvantages of investing in Pag-ibig MP2. Firstly, in the next article, we will discuss the comparisons of Pag-ibig MP2 when done monthly, annually, or through a one-time investment. Secondly, we will delve into the nitty-gritty of numbers and discuss how to compute Pag-ibig MP2 dividends. Without a doubt, I know you are ready to know the 5 strategies to maximize Pag-ibig MP2.

3 conditions

Before that, let me share the three conditions used for the 5 strategies to maximize Pag-ibig MP2.

1. Minimum investment

The minimum investment amount per month is used, which is ‎₱500. Hence, if the contribution is ‎₱500 per month, it’s equivalent to ‎₱6,000 in a year, and it is ‎₱30,000 in 5 years. Thus, the total investment for five MP2 accounts is Php 150,000.

2. Average dividend rate

We will be using the 7.5% dividend rate, which is the same as the official Pag-ibig MP2 examples, so we can conduct a comparative analysis. However, for a more mathematical approach, you may consider using the average dividend rate for the past 5 years to capture the highs and lows of investment in MP2.

You can read and view the past MP2 performance as well as the average dividend rate here.

3. Simple and compound interest formula

Simple and compound interest formula is used to project the earnings.

5 Strategies to Maximize Pag-IBIG MP2

These are just recommendations that you may or may not employ. So please take this with a grain of salt.

So here are the 5 strategies to get the most out of Pag-ibig MP2.

1. Dividend Payout

The first strategy is the dividend payout, as the name implies. Thus, this method involves receiving your dividends annually. For this reason, if you’re looking for a steady stream of income to finance your needs, there are several reasons why you might consider this approach.

For example, it could be for yearly vacation expenses, fees, memberships, and more.


Monthly Savings (MS) Accumulated MS per Year Cumulative Savings Annual Dividend Payout Total Accumulated Value TAV)
1 500 6,000 6,000 243.75 6,000
2 500 6,000 12,000 693.75 12,000
3 500 6,000 18,000 1,143.75 18,000
4 500 6,000 24,000 1,593.75 24,000
5 500 6,000 30,000 2,043.75 30,000
TOTAL 30,000.00 5,718.75 30,000

How does it work?

  • Open an MP2 savings account
  • Pay your contribution (monthly or yearly)
  • Indicate that you want a yearly dividend payout
  • Elect a bank account upon opening MP2 so you can easily receive your yearly dividends
  • Get your capital at the end of 5 years
  • Repeat as needed

2. Compounded Dividend

The second strategy is best for medium to long-term investors. In the same way, you will get your money and dividends after 5 years. But if you do this, you must be a long-term investor who wants capital growth.

But you may also consider other aggressive investments. It can be mutual funds, UITF, VUL such as single pay VUL (SPVUL), stock market, forex, etc., that have a history of outperforming Pag-ibig MP2 in the past.

Year Monthly Savings (MS) Accumulated MS per Year Cumulative Savings Dividend Amount Total Accumulated Value (TAV)
1 500.00 6,000.00 6,000.00 243.75 6,243.75
2 500.00 6,000.00 12,243.75 712.03 12,955.78
3 500.00 6,000.00 18,955.78 1,215.43 20,171.21
4 500.00 6,000.00 26,171.21 1,756.59 27,927.81
5 500.00 6,000.00 33,927.81 2,338.34 36,266.14
TOTAL 30,000.00 6,266.14 36,266.14

How does it work?

  • Capital and interest earn dividends
  • If you don’t need the money then let it stay here for better returns
  • Get your capital and dividends after 5 years
  • Repeat until you reach your financial goals

3. Tiered

Between the first 2 strategies, compounded dividends showed a much bigger return. Therefore, if you plan to use the money several years from now, you may consider opening a few more accounts. You may do this every year, so at the end of 5 years, you will start to receive the yearly maturity of your MP2 accounts.

After all, who doesn’t want a yearly payout? Totally not me 🙂

This strategy is for?

  1. Best for long-term investors, who want capital growth and security, as they can expect steady returns over time.
  2. If you are willing to invest an increasing amount per year, your investment returns may also increase over time.
  3. In addition, one must have the time and patience to manually open an MP2 account each year in order to continue investing.
1 6,000 6,244    
2 12,000 12,956 6,244  
3 18,000 20,171 12,956 6,244  
4 24,000 27,928 20,171 12,956 6,244
5 30,000 36,266 27,928 20,171 12,956 6,244
6 (24,000)   36,266 27,928 20,171 12,956
7 (18,000)     36,266 27,928 20,171
8 (12,000)       36,266 27,928
9 (6,000)         36,266
Total 90,000 12,266 18,266 24,266 30,266 36,266

How does it work?

  • Open an MP2 account on a monthly or yearly basis.
  • The contribution per year is Php 6,000. Thus, every year, the contribution increases by Php 6,000.
  • You can do this tiered strategy until you are happy. Hence, do not limit yourself to the example of 9 years.

Demystifying the “Tiered Strategy

Firstly, each MP2 is opened with a Php 6,000 yearly contribution, and dividends are compounded.

In the 2nd year, you will open another MP2 savings account. Thus, your contribution for that year is Php 12,000.

In the 3rd year, your contribution will be Php 18,000, in the 4th year, it’s Php 24,000, lastly, in the 5th year, it will be Php 30,000.

This is where things can get a little confusing.

Accordingly, at the end of 5 years, the first MP2 account will mature. Thus, you will get Php 36,266. But then, remember, you still have four MP2 accounts to pay.

So in that year, the total money that will go into your pocket is only Php 12,266.

Furthermore, at the end of the 6th year, you will pocket Php 18,266. To sum up, the matured MP2 has a payout of Php 36,266 and from there we will deduct the Php 18,000, which is the contribution for the remaining three (3) MP2 accounts. This continues until the end of the 9th year.

What’s the total contribution?

The total contribution is equal to Php 90,000, which is the sum of the first 5 years. Consequently, in the 6th year, you will no longer have to spare some cash as your first MP2 account matures.

However, I have noticed that some articles say that the total investment will be Php 150,000 for the span of 9 years. But will you agree with me that once you have received your first MP2 account, you will use the same money to pay for the remaining four MP2 accounts?

That’s why your total investment is only Php 90,000 because, after 5 years, your MP2 account can now stand on its own.

What happens if I continue opening an MP2 account per year?

Are you also curious about what will happen if you continue opening an MP2 account? If so, the answer is simple you will start to get yearly dividends of Php 6,266.

For this reason, the amount is equal to the payout from the matured MP2 account less the contributions for the remaining MP2 accounts. So, if you will continue opening MP2 accounts, then Php 6,266 is based on Php 36,266 minus 5 (Php 6,000).

Thus, the total investment is still Php 90,000, and you’ll get a yearly dividend of Php 6,266.

4. The Rollover

This strategy is best for long-term investors that can spare a huge sum of money. As an illustration, this is similar to compounded dividends strategy, wherein you will opt to get your capital and dividends at the end of the 5th year.

But at maturity, you will reinvest the capital and its dividends in MP2.

You may continue doing this until you reached your goal. For example, you want to prepare an educational fund for your children; if you want to do this for your retirement, why not.

READ: Sun Maxilink One | Earn Better than Banks

1 1,000,000 1,075,000
2 1,155,625
3 1,242,297
4 1,335,469
5 1,435,629
6 1,543,302
7 1,659,049
8 1,783,477
9 1,917,239
10 2,061,032
Total 1,000,000 2,061,032

How does it work?

  • Open an MP2 account with your one-time investment
  • Get your money upon maturity
  • Open a new MP2 account
  • Re-invest your money and its dividends after 5 years
  • Repeat until you reach your goals

Things to consider:

  1. You must get your money upon maturity because if not, it will be placed at a much lower interest rate.
  2. Opening a new MP2 account is needed every 5 years.
  3. It may take a while before you actually get your money based on the experience of other members.

Demystifying the “Rollover Strategy

The strategy is straightforward. You open an MP2 with a single investment and then receive the maturity at the end of 5 years. Subsequently, you will reinvest the money and its earnings by opening another MP2 account.

So in this example, you get to double your money in the span of 10 years. In Addition, this is about 106% growth in capital.

Again, bear in mind, we used the 7.5% dividend rate, which is higher than the average dividend rate in the past 5 years. Nonetheless, the examples shown here still stand true regardless of the actual rate for comparative purposes.

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5. The Combo

What if we combined the 4 strategies to maximize Pag-IBIG MP2 altogether and see which one will give the best possible return?

But before that, I would like to clarify that the combos presented here are not the only possible combos you can use.


Because in reality, you may not actually follow the strategies presented here, right?

Maybe, you will start doing monthly, then decide to switch to yearly. Or probably from the one-time investment, you decided to add more to your existing MP2 account, and so on. So please spare me from hate.

Combo 1: Monthly, Tier, and Rollover

The first combo is by investing Php 500 per month or Php 6,000 per year. Then opening another MP2 account every year. So at the end of the 5th year, upon maturity, you will open your 6th MP2 account using your matured investment of Php 36,266.

YEAR SAVINGS 1st MP2 2nd MP2 3rd MP2 4th MP2 5th MP2 6th
7th MP2 8th MP2 9th MP2 10th
0 6,000 6,000
1 6,000 6,244 6,000    
2 12,000 12,956 6,244 6,000  
3 18,000 20,171 12,956 6,244 6,000
4 24,000 27,928 20,171 12,956 6,244 6,000
5 30,000 36,266 27,928 20,171 12,956 6,244 36,266
6 24,000   36,266 27,928 20,171 12,956 38,986 36,266
7 18,000     36,266 27,928 20,171 41,910 38,986 36,266
8 12,000       36,266 27,928 45,053 41,910 38,986 36,266
9 6,000         36,266 48,432 45,053 41,910 38,986 36,266
10 0 52065 48,432 45,053 41,910 38,986
11 0 52065 48,432 45,053 41,910
12 0 52065 48,432 45,053
13 0 52065 48,432
14 0 52065
Total Investment 150,000 52,065 52,065 52,065 52,065 52,065

In addition, you will notice that this strategy is almost similar to the tiered example above. But there are two main differences:

  1. The total investment here is Php 150,000. This is because, in the 6th year, you will open your 6th MP2 account using the Php 36,266 you get from the first matured MP2 account. Then you still have 4 remaining MP2 accounts, so you must invest an additional Php 24,000 for that year, and the same goes for the remaining years.
  2. You will start to receive your matured MP2 account in the 10th year.

So, how much is the return after 14 years?

The total return on investment will be maturity minus the capital. Accordingly, it will look like this.

5 x (Php 52,065) – Php 150,000 = Php 110,325

Hence, it is equal to a 74% return in 14 years.

Combo 2: Annual, Tier, and Rollover

In this combo, you will open one MP2 account every year for the next 5 years. Then reinvest the money upon every maturity of MP2 accounts.

YEAR SAVINGS 1st MP2 2nd MP2 3rd MP2 4th MP2 5th MP2 6th MP2 7th MP2 8th MP2 9th MP2 10th MP2
0 30,000 30,000
1 30,000 32,250 30,000    
2 30,000 34,667 32,250 30,000  
3 30,000 37,269 34,667 32,250 30,000
4 30,000 40,064 37,269 34,667 32,250 30,000
5 30,000 43,068 40,064 37,269 34,667 32,250 43,068
6   43,068 40,064 37,2694 34,667 46,298 43,068
7     43,068 40,064 37,269 49,770 46,298 43,068
8       43,068 40,064 53,503 49,770 46,298 43,068
9         43,068 57,516 53,503 49,770 46,298 43,068
10 61,830 57,516 53,503 49,770 46,298
11 61,830 57,516 53,503 49,770
12 61,830 57,516 53,503
13 61,830 57,516
14 61,830
Total Investment 150,000 61,830 61,830 61,830 61,830 61,830

The total investment is Php 150,000.

Thus, the return on investment is Php 159,150. Meanwhile, it will look like this in an equation.

5 x (Php 61,830) – Php 150,000 = Php 159,150

Hence, that’s a total of 106% growth in the capital after 14 years.

Combo 3: One time and rollover (simply the “Rollover”)

Lastly, this combo is just the same as the rollover strategy above. But the only difference is we extended the timeframe to 15 years.

You might be raising an eyebrow. But let me explain first.

The two combos above are only 14 years, right? However, this example is for 15 years simply because the 3rd MP2 will mature after 15 years.

YEAR SAVINGS 1st MP2 2nd MP2 3rd MP2
0 150,000 150,000
1 161,250
2 173,343
3 186,344
4 200,320
5 215,344
6   231,495
7   248,857
8   267,522
9   287,586
10 309,155
11 332,341
12 357,267
13 384,062
14 412,867
15 443,832
Total Investment 150,000 443,832

With a total investment of Php 150,000, the return on investment amounts to Php 159,150.

To illustrate this with an equation, the calculation would be as follows: Php 443,832 – Php 150,000 = Php 293,832, which represents the profit gained from the investment.

Additionally, it’s important to note that the return on investment of Php 159,150 is a significant increase compared to the initial investment of Php 150,000.

That’s a total of 196% growth in the capital after 15 years. It’s no surprise that the one-time investment will give the best possible return, as it was already illustrated in our previous blog about the comparison of monthly, yearly, and one-time contributions in MP2.

Let’s wrap it up!

Congratulations! You finally reached this part. I know it’s a long read, and some parts are difficult to follow. So take your time and read the previous blogs about this topic to equip you with the right knowledge in MP2.

Just like what I said in the beginning, all strategies presented here are only recommendations. And even if you can easily identify which strategy will grant you the maximum return doesn’t mean it’s the right strategy for all.

GET NOW: Pag-IBIG MP2 Calculator

Remember that our goals and financial resources are not the same while we aspire for the best possible return. So feel free to adapt to the most realistic strategy and step up your game as you progress in life.

There is nothing wrong with taking baby steps. It might take you a while, but the most important thing is that you can get there.

Happy investing!


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