Starting this Monday, all formal workers on the payroll can access their money given by their Service Time Compensation (CTS). This social benefit, which is delivered twice a year in May and November, is a support to the worker when facing unemployment.
In a normal context, the full withdrawal of CTS funds is only possible when a worker ends their employment contract or dies. While you still have work on the payroll, you can make partial withdrawals when the amount accumulated in the CTS account exceeds the equivalent of four salaries. In that case, the surplus can be withdrawn.
But after the approval of the Law that allows the total withdrawal of the CTS, all workers will be able to withdraw that money until December 31, 2023.
With that in mind, Roberto García, Leader of the AhorroYa! of Prima AFP, advises how best to manage the payment of the CTS.
- Be cautious. Only withdraw from your CTS fund if necessary. The purpose of this money is to help in times of unemployment instead of everyday expenses. In addition, financial institutions usually pay competitive interest to keep these deposits intact.
- Prioritize paying your debts. If you have a surplus in your CTS account and debts with the financial system, prioritize the payment of your expensive debts to relieve pressure on the CTS, such as credit card or vehicle credit.
- Evaluate making a change of bank. You always have the option and power to change banks if you are not entirely satisfied with your CTS deposited there.
- Save for your pension fund. You can also put that money in an AFP account without a pension purpose. Thus, the money can be withdrawn at any time and generates the same profitability that the mandatory funds are earning, which in the last 15 years have had an annual return of more than 7%. The only requirement is to have at least 5 years in an AFP. In addition, Prima AFP members can save practically without noticing it, through the purchase of fuel and household appliances at stores associated with the Savings Now! program. (https://bit.ly/3DcYrap).