What is voluntary AFP savings?

The Pension Fund Administrators give you the opportunity to make additional savings to the mandatory by law. With this capital, you can make from an investment in the medium and long term, to improve the conditions of your pension. You can learn about it by reading this article, where we tell you what is voluntary AFP savings.

What is a voluntary contribution?


The Pension Fund Administrators or AFPs are within the existing financial institutions in Colombia. These are responsible for managing the pension fund to which by law you quote a percentage of your salary. This fee is called mandatory contribution, and its objective is to finance your future retirement pension.

However, the AFPs also function as a kind of savings entity that collects money from the public. When you make an additional contribution to the mandatory in an AFP, you are making a voluntary contribution to it. And in this way of saving, it is known by the name of voluntary savings AFP.

AFP voluntary savings.


This is a type of savings that is exclusively aimed at improving financial conditions at the time of retirement. This is because everything you save in this way, you can only have after the time of your retirement.

Voluntary pensions , in Colombia, are a form of voluntary savings that gives a linked or independent worker the possibility of complementing the mandatory pension, obtained during his working life. The worker makes periodic contributions to a Pension and Severance Fund that manages the resources through investment portfolios with different levels of risk and profitability.

As an additional contribution you make to the pension fund, to have additional savings when your retirement occurs.

As an additional contribution you make to the pension fund, to have additional savings when your retirement occurs.

Surely you wonder what advantage this saving has in an AFP instead of the common savings instruments. There are three characteristics that make the AFP option the best, namely:

  • By saving in the AFP you get the legal certainty that your saved capital cannot be seized.
  • The contributions you make are exempt from the income tax payment, which implies other indirect savings.
  • Your contributions are not subject to a minimum amount of contribution or set deadlines, like other savings instruments.

This particular way of saving allows you to:

  • Have at the time of retirement all the capital you have saved with this instrument.
  • Increase the fees you receive from the pension fund, once retired.

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