100k one time deposit in pag-ibig mp2, how much after 5 years?

September 25, 2025No CommentsDividends

If you make a ₱100,000 one-time deposit into Pag‑IBIG MP2 and let it grow for 5 years, here’s what you might expect—comparing both compounded and non‑compounded dividend options. I used a trusted MP2 calculator to simulate this scenario and cross‑checked dividend rates that averaged around 7%, which is currently in line with recent declared rates

Table of Contents

Option 1: Compounded Dividends (Reinvested Each Year)

With the compound interest option, your dividends stay in the account and earn returns in subsequent years. This results in exponential growth over time.

Estimated values (assuming a consistent 7% annual rate):

Year	Start	Dividend (7%)	End-of-Year Balance
1	₱100,000	₱7,000	₱107,000
2	₱107,000	₱7,490	₱114,490
3	₱114,490	₱8,014	₱122,504
4	₱122,504	₱8,575	₱131,079
5	₱131,079	₱9,175	₱140,254

After 5 years, this yields approximately ₱140,254, with ₱40,254 earned in dividends.

This compounding aligns with the standard calculation framework:
Final Amount = Principal × (1 + r)^t

Here:
₱100,000 × (1.07)^5 ≈ ₱140,255

Option 2: Non-Compounded Dividends (You Withdraw Each Year)

With non-compounding, you receive 7% of your original principal (₱7,000) yearly, and the principal remains unchanged.

5 × ₱7,000 = ₱35,000 in total dividends
Principal (₱100,000) remains intact
Net total after 5 years = ₱100,000 (principal) + ₱35,000 (dividends) = ₱135,000

You earn less compared to compounding—about ₱5,000 less over 5 years.

Why Compounding Gives You More

The power of compounding means each year’s dividends also earn returns. As shown, your money grows faster because:

Year 2 dividends are calculated on ₱107,000, not ₱100,000
Details in the calculator equate to effective interest rate ~7% annually

Summary Comparison

Option	Final Balance	Total Dividends	Notes
Non-Compounded (Yearly)	₱135,000	₱35,000	Dividend withdrawn yearly, principal intact
Compounded (5-Year)	₱140,254	₱40,254	Dividends reinvested, exponential growth

Why This Matters

You maximize earnings by choosing compounding—getting about ₱5,000 more over 5 years.
Dividends are tax-free, making MP2 particularly efficient.
Principal is secure—backed by the Philippine government.
Medium-term planning—you can let it mature and then reinvest.

What the Calculator Website Advises

Provides breakdowns for different frequencies (though your one-time deposit is just the initial amount).
Confirms that a single lump-sum deposit grows best when dividends are compounded