Choosing an AFP

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Space Cat
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Re: Choosing an AFP

Post by Space Cat » Tue Mar 27, 2018 10:11 pm

So, which one is the lesser evil 4 years later? I'm finally starting to pay taxes next month and need to enroll into AFP.

PlanVital was the cheapest one but it collapsed recently. Habitat was the best in 2017, should I go for it then?

Gloria
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Re: Choosing an AFP

Post by Gloria » Wed Mar 28, 2018 9:16 am

Space Cat wrote:
Tue Mar 27, 2018 10:11 pm
So, which one is the lesser evil 4 years later? I'm finally starting to pay taxes next month and need to enroll into AFP.

PlanVital was the cheapest one but it collapsed recently. Habitat was the best in 2017, should I go for it then?
Go with Habitat or Modelo. Keep in mind that there´s a possibility of all AFP´s getting either "revisited" or wiped out completely in a near future.
I'm from the generation of common sense, wisdom and unfiltered answers. I sayeth as I seeth.

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Space Cat
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Re: Choosing an AFP

Post by Space Cat » Wed Mar 28, 2018 1:25 pm

Gloria wrote:
Wed Mar 28, 2018 9:16 am
Go with Habitat or Modelo. Keep in mind that there´s a possibility of all AFP´s getting either "revisited" or wiped out completely in a near future.
Thanks, I guess there's not much to do to avoid this kind of future. I'm not going to use something like APV but 10% to AFP is required for honorarios starting this year.

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Re: Choosing an AFP

Post by admin » Wed Mar 28, 2018 4:05 pm

Here just came across the ranking of commision for the afps

https://www.df.cl/noticias/mercados/fin ... 72704.html

Invest in the fundo A, or "high-risk" fund, because they all have way too many constrains on them all ready.

Everyone keeps bitching about the returns of the afps, but a monkey with a dart board full of ticker symbols could get better returns. A lot of it has to do with the goverment restrictions, that essentially force the afps to do everything you should never do with a long-term retirment fund.
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Re: Choosing an AFP

Post by admin » Wed Mar 28, 2018 4:21 pm

https://www.df.cl/noticias/empresas/ban ... 14907.html

Its the commisions, stupid!!!

Dug in to one of the u.s. mutuel funds offered by a chilean bank a while back. They were charging like a 5% commision. Found out the con artist were just buying the u.s. vanguarde funds with like a 0.30 to 0.50% commision. It took me a good 4 hours of digging to find that out.
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Re: Choosing an AFP

Post by admin » Thu Mar 29, 2018 8:25 am

Here were the average returns this month for the afp funds by risk catagory. It was a crappy month for the markets overall.

http://www.pulso.cl/trader/fondo-pierde ... mundiales/

Given the tiny spread between the A fund and the E fund
, unless you are 80 years old i really see no reason to invest in anything but the A fund since you are being forced to choose.

Of course, i dont believe depending on any goverment scheam for retirment is ap good investment. If i see anything from it someday, wonderful; otherwise i just consider it another tax.

The history of all goverment retirment scheames says, most get wiped out as politicians can never keep their hands off the cookie jar. Why i am very, very against the bullshit the left is pushing to create a goverment run afp.

They need to modernize of the current afp system, but otherwise keep the goverment's hands off. Lower the commissions, implent some of the tax breaks more lke the 401k systems to encourage more savings, etc.

Still, i assume i am on my own when it comes to retirement, and i sure as hell do not want to wait untill i am 65, 70, or dead to cash in on the pyramid scheme of a goverment retirement plan.
Spencer Global Chile: Legal, relocation, and Investment assistance in Chile.
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Re: Choosing an AFP

Post by jehturner » Fri Mar 30, 2018 5:26 pm

Yeah, just the same as the mutual funds. The business model for equity funds seems to go like this:

* Customer provides some capital.
* Fund invests the money and keeps the (average) profit.
* Fund returns the customer's original capital, plus or minus its variation with volatility.
* Ie. customer assumes the risk, bank assumes the returns.

Who wouldn't want to participate in such a scheme?

mem
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Re: Choosing an AFP

Post by mem » Sat Sep 08, 2018 3:50 pm

So to summarize.


Chilean social security/AFP is a joke. The money put into it should be kissed goodbye as a throwaway fee for immigration and alternative to US SS

The only benefit is Chilean AFP/social security is less than US Social Security so with a totalization agreement it can cut your US tax bill

Bottom line: Find the absolute cheapest AFP and who cares if they go belly up later, just find the next cheapest AFP at that time.

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Re: Choosing an AFP

Post by thisisreallycomplicated » Sat Sep 08, 2018 4:52 pm

mem wrote:
Sat Sep 08, 2018 3:50 pm
So to summarize.


Chilean social security/AFP is a joke. The money put into it should be kissed goodbye as a throwaway fee for immigration and alternative to US SS

The only benefit is Chilean AFP/social security is less than US Social Security so with a totalization agreement it can cut your US tax bill

Bottom line: Find the absolute cheapest AFP and who cares if they go belly up later, just find the next cheapest AFP at that time.
That sounds about right
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Re: Choosing an AFP

Post by admin » Sun Sep 09, 2018 8:28 am

mem wrote:
Sat Sep 08, 2018 3:50 pm
So to summarize.


Chilean social security/AFP is a joke. The money put into it should be kissed goodbye as a throwaway fee for immigration and alternative to US SS

The only benefit is Chilean AFP/social security is less than US Social Security so with a totalization agreement it can cut your US tax bill

Bottom line: Find the absolute cheapest AFP and who cares if they go belly up later, just find the next cheapest AFP at that time.

Here is the thing. The chilean AFP system is probably the best mouse trap out there, among a globe full of broken mouse traps.

My beef against the afp system is it could be a lot more efficient, and have better returns. In short, it needs to be modernized. What these idiots earn in commisions should be invested, and their jobs could be replaced by a computer. In fact, i am almost certain most of these afps are being run by computer trading. Not some "expert" giving it deep thought. So why are we paying for a computer algo to do all the work?
Spencer Global Chile: Legal, relocation, and Investment assistance in Chile.
For more information visit: https://www.spencerglobal.com

From USA and outside Chile dial 1-917-727-5985 (U.S.), in Chile dial 65 2 42 1024 or by cell 747 97974.

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