RetireJapan

Hey Everyone,

With the new year comes renewed vigour to save money after some crazy overspending

I am finally looking to dive into iDeco, but I'm a bit confused by the eligibility. I've asked my employer about this a few times but it seems they're just as lost as I am.
When going through the eligibility questionnaire on the iDeco website, it asks:
Q3企業型確定拠出年金（企業型DC）に入っていますか。

The only pension I know I am enrolled in is the Shigaku Kyosai (PMAC) pension as I work in a private school. I'm not sure if this counts as a DC, which I think would make me ineligible for iDeco? If it is not, it says I can make 12,000 monthly contributions.
Is anyone else with a private school, paying into Shigaku Kyosai, and using iDeco?
Alternatively, is there anyone working in a private school, paying into Shigaku Kyosai, and part of a "corporate defined contribution (DC)" pension plan? Is that a separate from the PMAC (Shigakukyosai) pension?


I still don't know if I'll be retiring in Japan nor if I will be able to fulfil the 10 year requirement... Thinking maybe I can use my taxpaying years in Canada to count towards it if not.
I know I should have gotten started with iDeco years ago (got here 2020), but better late than never, I suppose! I realize I may not be able to access the benefits until 65, but I'm thinking the amount is pretty low, and the reduction to taxable income + tax-free withdrawal would actually still make it all worth it.

Thanks!

There is 企業型DC and 個人型DC (this one is iDeCo - the individualDefinedContribution ).

If you're not paying monthly contributions (deducted from your salary) into a selection of funds where you can log in and track their performance, you're probably not enrolled in a 企業型DC.

This is the actual form you'll have to fill it. For section 5, it looks like you're 52 or 53. Unhelpfully it doesn't tell you what limits those translate to...
https://www.ideco-koushiki.jp/library/p ... sample.pdf

I don't work for a private school though, I'm just a regular salaryman. Maybe others can help.

I definitely don't get to select any funds! Looks like the PMAC pension is just the mandatory one that replaces (but is bigger contributions than?) the Public Pension.

Thanks for the insight!

Probably just put down 52 and hope for the best? The application goes for approval by the pension service, so in the worse case they'll reject it if you were wrong.

linkthe2nd wrote: ↑Wed Dec 27, 2023 3:47 pm I definitely don't get to select any funds! Looks like the PMAC pension is just the mandatory one that replaces (but is bigger contributions than?) the Public Pension.

Yes. This. It is your industry version of 厚生年金.

beanhead wrote: ↑Wed Dec 27, 2023 4:00 pm

linkthe2nd wrote: ↑Wed Dec 27, 2023 3:47 pm I definitely don't get to select any funds! Looks like the PMAC pension is just the mandatory one that replaces (but is bigger contributions than?) the Public Pension.

Yes. This. It is your industry version of 厚生年金.

Someone else mentioned somewhere that they were in the Shigaku Kyousai, and were able to contribute Y12,000 per month to iDECO.

linkthe2nd wrote: ↑Wed Dec 27, 2023 1:41 pm The only pension I know I am enrolled in is the Shigaku Kyosai (PMAC) pension as I work in a private school. I'm not sure if this counts as a DC

Shigaku kyousai is not a DC pension. You are a Kyosai member, so your iDeCo is based on being a public servant or similar.

12,000 yen a month maximum for now, rising to 20,000 yen a month from September 2024.

12,000 yen is quite low number.
What is the optimal course of saving as shigaku kyousai members?
Is there a corporate DC type saving account available for them?

zak wrote: ↑Thu Dec 28, 2023 7:35 am 12,000 yen is quite low number.
What is the optimal course of saving as shigaku kyousai members?
Is there a corporate DC type saving account available for them?

Probably iDeCo NISAtaxable

1.Pay the maximum into Shigaku Kyousai - This is deducted Pre-Tax, so no tax withholding, but no refund...

2. Pay the maximum into iDECO
iDECO contributions are paid from Post-Tax Income, so tax is being withheld through the year, but are actually from Pre-Tax Income, so you will get a Tax Refund equal to your Marginal Rate of Income Tax and Reconstruction Tax on that money at the Year End Adjustment - Nenmatsu Chosei - in Dec payroll, or after Tax Filing - Kakutei Shinkoku - the following April.
In this case, total iDECO contributions in 2024 of Y12,000 x 8 + Y20,000 x 4 = Y176,000
Depending on Tax Band.... Refund of 5.105%, 10.21%, 20.42%, 23.483%, 33.693%, 40.84%, or 45.945%... (if the contributions fall within a single band...)
which you can immediately sweep into NISA tax free.

3. Pay whatever you can into Tsumitate NISA through the year.

4. When you get the Tax Refund for the Withholding Tax that was paid on the iDECO contributions through the year, immediately sweep that tax refund in to NISA, either Tsumitate as a Bonus Payment or the Growth Portion as a Lump Sum payment...

5. The Tax Deduction of the iDECO will also have reduced your taxable income, and so your Residents' Taxes at 10% for the year will also be reduced, reducing your Residents' Tax Payments from July of the following year thru June the year after that by Y176,000 /10 / 12 = Y1,460 per month, which you can add to your NISA contributions...

6. If you have any more to invest, you can do so in the NISA to the maximum allowances, and then through a Tokutei Account or a regular account...