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Pension plans


During the past decade, the pension system in Colombia has undergone modifications, as the country has tried to avoid liquidity and solvency issues that were common in the past. Deep reforms were implemented, the retirement age was changed as well as the eligibility criteria for state and private pensions.
The old age retirement limit in Colombia is currently 57 for women and 62 for men.

There are two pension systems currently operating in Colombia. One is the state scheme (Prima Media), the other is the private one (called Ahorro Individual Solidario). All employees must be enrolled in at least one of them. The mandatory contribution is 16% of the gross salary, payable between the employer (12%) and the employee (the remaining 4%). If non-monetary payments made by the employee exceed 40% of the salary, they are subject to the contributions as well. 

State Pension Plan

The institution that administrates state pensions is Colpensiones. Among the pension schemes offered by Colpensiones are old age pension schemes, disability pensions and special old age pensions (for parents of a disabled child, permanent disability, or high-risk professions which benefit from early retirement). 
In order to benefit from a pension, the person must have contributed to the system for a minimum of 1300 weeks. The amount of the pension depends on the contributor's average salary during the decade prior to retirement, and cannot be lower than a minimum salary. 

In order to claim a pension, the applicant must file a request with Colpensiones, enclosing, as a minimum, a duly signed form, the affiliate's ID, EPS information, and a declaration that the applicant is not already receiving a pension from Colpensiones.

Private Pension Plan

Alternatively, contributions may be made to a private pension fund, in the amount  specified by the policies of each fund. Regulated by the the Law 79/2003, the private plans in Colombia only return the contributor the total amounts paid during the subscription period, effectively functioning as a savings account.
The amount of the pension depends on the contributions made, as the law does not establish any minimum or maximum limits for the pension.

Expat Pension Plans

Foreigners who are legally contracted to work in Colombia as employees are contributors to the pension schemes, and eligible to receive benefits upon retirement. However, the law stipulates that if the person is also a contributor to the national pension scheme in his or her home country, affiliation to the Colombian pension scheme is voluntary.

Additionally, Colombia has signed agreements with four countries (Spain, Chile, Argentina and Ecuador), in order to allow for years worked in the respective country to accrue for pension in Colombia, and for amounts contributed to the pension scheme to be included in the pension. 

If your country does not allow for years worked in Colombia to count toward your state pension, there may be an opportunity to buy back time once you have returned to your home country and are once again contributing to the pension plan. Again, inquire with your state plan about the particulars.

Collecting Pension while Abroad

Colombian state pensions may be collected in U.S. or Canada, as long as the mandatory contribution period of 1300 weeks has been made. In order to collect your pension from abroad, you must file a request with Colpensiones. Special documentation may apply.


20/08/2018

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