All you need to know about the second salary plan and retirement scheme in the UAE

UAE is a thriving and prosperous country that offers a range of employment opportunities for professionals globally. With its diverse workforce, the government has implemented various measures to ensure financial security for employees, such as the Second Salary Plan and Retirement Scheme.

The Second Salary Plan is a program initiated by the UAE government to encourage people to save for retirement. It is a voluntary scheme that allows employees to set aside a portion of their salary for future use. The program is open to all UAE residents, including expatriates, and offers a range of investment options to suit individual needs.

Employees who participate in the Second Salary Plan are required to contribute a minimum of 5% of their basic salary towards their retirement savings. Employers are also required to make a matching contribution of 5%. This way employees can save up to 10% of their salary towards their retirement.

The Second Salary Plan offers a range of investment options, including mutual funds, stocks, bonds, and real estate. The program is managed by many reputable financial institutions in the UAE, including the National Bank of Abu Dhabi, Emirates NBD, and Mashreq Bank.

The Retirement Scheme is a mandatory savings program that requires employers to contribute a percentage of their employees' salaries toward their retirement savings. The program is mandatory for all UAE nationals, and expatriates who have been working in the country for more than one year.

Under the Retirement Scheme, employers need to contribute a minimum of 5% of their employees' basic salary towards their retirement savings. This contribution increases to 15% for UAE nationals who have been working for their employer for more than 20 years. Expats working in the country for more than one year are also eligible for the scheme, but the contribution rate is set at 2%.

Both the Second Salary Plan and Retirement Scheme offer significant benefits for employees in the UAE. They provide a secure and reliable means for people to save for their retirement, and the investment options available through these programs allow individuals to tailor their savings to their personal needs.

The UAE government has implemented several measures to ensure that employees can save for their future. The Second Salary Plan and Retirement Scheme are just two examples of these initiatives, which offer significant benefits to individuals living and working in the UAE. By participating in these programs, employees can secure their financial future and enjoy a comfortable retirement.