Simple Q&A - iDeCo

[JapaneseMike]

Hey there, finally planning to start my Ideco/Nisa.

Regarding the Ideco allowance, is it retroactive? E.g. if I worked and paid taxes in Japan for a shortwhile before starting my Ideco, can I make a larger first payment than the max of my monthly allowance?

Also I hear everyone recommend Monex/Rakuten/SBI - but when I checked online here: https://www.dcnenkin.jp/search/commission.php
It doesn't seem they are the cheapest, or may have closing fees etc. Any reason to not do it through a large bank e.g. SMBC? Fees seem similar, I already have an account there, and it's more likely "too big too fail" than internet startups in the long run. Just wondering what are your takes on this.

Thanks!

No. You don't get an annual allowance in iDeCo, you get a monthly one. If you don't pay it in a certain month, you can't go back.

I know this because when I initially opened my iDeCo, it was July or August, so I wanted to pay back the first 6 months since I figured I had 'an annual limit' - needless to say I was shot down.

Moral of the story, don't miss your payments.

[zeroshiki]

The reason to go with low cost brokers (SBI/Rakuten/Monex) is that they offer low cost funds like emaxis Slim or SBI Vanguard in their iDeCo offerings. iDeCo is managed by a different entity so even if your broker goes belly up (I have a hard time believing SBI will ever collapse though) your funds will be safe.

If you don't care about low cost funds in your iDeCo (and you should) or your bank already has the fund you want, then sure go ahead and open the iDeCo with them.

[RetireJapan]

Hey there, finally planning to start my Ideco/Nisa.

Regarding the Ideco allowance, is it retroactive? E.g. if I worked and paid taxes in Japan for a shortwhile before starting my Ideco, can I make a larger first payment than the max of my monthly allowance?

Also I hear everyone recommend Monex/Rakuten/SBI - but when I checked online here: https://www.dcnenkin.jp/search/commission.php
It doesn't seem they are the cheapest, or may have closing fees etc. Any reason to not do it through a large bank e.g. SMBC? Fees seem similar, I already have an account there, and it's more likely "too big too fail" than internet startups in the long run. Just wondering what are your takes on this.

Thanks!

Nope, you are losing your allowance each month that goes by -and it will take 2-3 months to get the account open. iDeCo is strictly month by month, no retroactive payments allowed.

Generally the big online brokers (not really internet startups) have better lineups of funds and lower fees than banks. But if you check your bank and you're happy with their lineup no reason not to go with that.

One thing to keep in mind is that whoever you do it with (apart from Rakuten Securities), the iDeCo account is likely to be handled separately, with a different website/login to your other accounts.

[stump117]

Thank you all for your answers. Very helpful!

I'll try to open an account ASAP today then, already lost quite a bit of time! Is there a source that lists the funds available on the most popular platforms? So far only found comparison of the quantity of funds.

One additional thing I'd like to ask. My spouse (non-JP), has a dependent visa tied to mine. She is unemployed for now, but my employer has been paying her nenkin I believe (will triple check when they are back from Obon week).

In that case, any chance she qualifies to category 1 "Self-employed, student, etc."? Or is she automatically a "Housewife" category 2? Not sure how to read the table on the official website: https://www.ideco-koushiki.jp/english/

Also I assume we will need to create two separate accounts right?

Sorry for the basic questions!

[Beaglehound]

Thank you all for your answers. Very helpful!

I'll try to open an account ASAP today then, already lost quite a bit of time! Is there a source that lists the funds available on the most popular platforms? So far only found comparison of the quantity of funds.

One additional thing I'd like to ask. My spouse (non-JP), has a dependent visa tied to mine. She is unemployed for now, but my employer has been paying her nenkin I believe (will triple check when they are back from Obon week).

In that case, any chance she qualifies to category 1 "Self-employed, student, etc."? Or is she automatically a "Housewife" category 2? Not sure how to read the table on the official website: https://www.ideco-koushiki.jp/english/

Also I assume we will need to create two separate accounts right?

Sorry for the basic questions!

You will certainly need separate accounts. As long as she is a dependent in terms of being on your shakai hoken, I would think she will be limited to the category 2 contribution level.

[kuma]

Thank you all for your answers. Very helpful!

I'll try to open an account ASAP today then, already lost quite a bit of time! Is there a source that lists the funds available on the most popular platforms? So far only found comparison of the quantity of funds.

One additional thing I'd like to ask. My spouse (non-JP), has a dependent visa tied to mine. She is unemployed for now, but my employer has been paying her nenkin I believe (will triple check when they are back from Obon week).

In that case, any chance she qualifies to category 1 "Self-employed, student, etc."? Or is she automatically a "Housewife" category 2? Not sure how to read the table on the official website: https://www.ideco-koushiki.jp/english/

Also I assume we will need to create two separate accounts right?

Sorry for the basic questions!

You will certainly need separate accounts. As long as she is a dependent in terms of being on your shakai hoken, I would think she will be limited to the category 2 contribution level.

Your wife will be Category 3 (provided she's insured by your shakai hoken as you suspect).

https://retirewiki.jp/wiki/IDeCo#Contributions summarises the categories using slightly different language than the official iDeCo site in an aim to clear up a couple of potential points of confusion.

Unfortunately the the official iDeCo English table introduces some confusion through the language they use. 'Full-time homemaker' could actually be a spouse on a low salary; the critical point here is whether or not the spouse is covered by his/her partner's shakai hoken.

[RetireJapan]

Unfortunately the the official iDeCo English table introduces some confusion through the language they use. 'Full-time homemaker' could actually be a spouse on a low salary; the critical point here is whether or not the spouse is covered by his/her partner's shakai hoken.

The Japanese explanations are substandard too, because instead of just saying that iDeCo is based on what kind of nenkin you pay, they try to give categories of people/jobs that they think are typical of the people that are paying those types of nenkin.

Whereas they should just come out and say it (and give examples in brackets). It would eliminate a lot of confusion.

[kuma]

they should just come out and say it (and give examples in brackets). It would eliminate a lot of confusion.

Brackets swiftly added to the wiki

[nickr]

Quick question just to check something for my peace of mind (sorry if this has already been asked):

I applied for iDeco through Rakuten a while ago. Checking the website, my current status is "Step 4: 審査中(国基連) - 国基連にて審査中です"

Yesterday, I got two things in the post from "JIS&T":
1. a letter with my 加入者口座番号 & name
2. a postcard with a "Call Center password" and an "Internet password"

There aren't any instructions on how to proceed, so should I just keep those safe and wait for Step 5 (口座開設完了)?

Thanks.

[beanhead]

Quick question just to check something for my peace of mind (sorry if this has already been asked):

I applied for iDeco through Rakuten a while ago. Checking the website, my current status is "Step 4: 審査中(国基連) - 国基連にて審査中です"

Yesterday, I got two things in the post from "JIS&T":
1. a letter with my 加入者口座番号 & name
2. a postcard with a "Call Center password" and an "Internet password"

There aren't any instructions on how to proceed, so should I just keep those safe and wait for Step 5 (口座開設完了)?

Thanks.

Yep, just wait a little bit longer. Rakuten will inform you when the account is ready. Then you log in and choose your funds to purchase.