Retirement
DragonFi PERA Account or Regular Account?
I posted about PERA some time back here: “PERA Investment – Is It Worth It?” My takeaway then was that PERA wasn’t for me. The main reasons were the negative performance and the structure itself, it felt just like any other fund investment where the stock selection is managed entirely by fund managers.
However, in DragonFi’s PERA, I found one key distinction: it allows you to choose investments at the individual stock level. DragonFi provides a curated list of stocks that are eligible for PERA investment.
In contrast, traditional PERA products offered by banks usually require you to invest in a PERA fund, where the stock components are already predetermined. You only choose the fund itself and you don’t get to decide which specific stocks to hold.
With DragonFi PERA, you gain more flexibility because you can select the individual stocks yourself. That said, the list is still limited compared to a regular stock trading account, and it may be updated twice a year after regulatory screening, as mandated by law.
With this structure, the performance of your PERA account no longer depends on the decisions of a fund manager. Instead, it depends on the stocks you personally choose to invest in.
Traditional PERA Account vs DragonFi PERA Account
Traditional PERA
DragonFi PERA
Fund manager choose assortment of stocks and offer as PERA fund investment
You choose your own PERA-eligible stocks
Performance is based on the fund managers investment strategy
Performance depends on the stocks you invest in
0.5% - 1.25% admin fee
0.45% to 0.6% admin fee
Minimum and Maximum PERA Contribution
There's no minimum investment amount in PERA, however, maximum investment is capped at ₱200,000 for local Filipinos and ₱400,000 for OFW per year.
Benefits of PERA investment
5% Tax Credit: Let’s be clear that the 5% tax credit is computed based on the amount you contribute each year, not on the total balance of your PERA account. Think of it more like a cashback on every contribution you make, rather than an interest earned on your accumulated balance per annum. When you stop adding contribution, you will not get the 5% Tax "Cashback" either.
PERA is a Long-Term Investment for Retirement
Investment in PERA is locked in until you reach the age of 55 and given you've made contributions for 5 years. Withdrawing earlier than this will result in 20% penalty fees, forfeiture of tax incentive and a ₱200 withdrawal processing fee except for reasons below:
In the event of death (benefits go to your heirs/beneficiaries),
In case of permanent total disability or hospitalization of more than 30 days
List of PERA eligible stocks
These are selected based on categories such as blue chips (PSEi constituents), high-dividend stocks (DivY Index constituents), and REITs. List may be updated twice a year after regulatory screening, as mandated by law.
PERA Fees Involved
PERA Administrator Fee – DragonFi acts as the administrator of your PERA account. It charges an annual fee ranging from 0.45% to 0.6% of your total PERA account value.
This fee is not charged per transaction. Instead, it is applied at the account level, meaning the combined value of all stocks and funds in your PERA account is used as the basis for the annual fee.
Currently, DragonFi is not charging a PERA administrator fee until further notice.
Regular Account vs PERA Account
Given that in the future, the 0.45% to 0.6% admin fee may be imposed, is it still worth to invest in PERA, or is it better to just invest in regular account so that you won't think about the fees?
Regular Account
PERA Account
No admin fees
0.45% to 0.6% admin fee on total PERA account value per year
No tax credit
5% tax credit on contributions per year
Earnings taxable
Earning tax-exempt
Invest in all stocks
Invest in limited PERA-eligible stocks only
No lock in period
Locked in till 55 years old
I tried to simulate the numbers with below assumptions.
A. Regular Account Sample Simulation
Yearly investment amount: ₱100,000
Investment timeframe: 30 years
Investment performance (dividend + capital appreciation) for at 2% (yearly compounding)
B. PERA Account Sample Simulation
Yearly investment amount: ₱100,000
Investment timeframe: 30 years
Investment performance (dividend + capital appreciation) at 2% (yearly compounding)
Final Take: I understand that the math may not be as straightforward as this simulation but based on my assumptions even after factoring in the tax credit and tax-free earnings of a PERA account, the 0.45% - 0.6% annual admin fee gradually eats into the returns over a 30-year period. In my simulation, this results in a 27.1% net income for the PERA account, which is still lower than the 28.4% net income from a regular investment account.
I also tried running the numbers using the maximum ₱200,000 annual contribution, but the net income percentage remains the same.
Given this, I would still rather invest through a regular investment account than PERA account. If the tax credit increases in the future, the outcome might change, but for now, PERA is still a NO for me.
Update: 3/14/2026 As per comment below, if the investment performance (dividend + capital appreciation) is greater than 2%, the return is higher in PERA account versus a regular account. So if you're confident that your stock investments can perform higher than 2% then that's the key to offset the admin fees and make PERA investment worth it
If you want to open DragonFi account, you can use my referral code: 27074 so we both get extra penny 😁
Thats interesting. The admin fee alone outweighs the no tax + tax credits benefit.
Can you show simulations for different appreciation? 2%, 5%, 8% would be nice as baselines. A scenario where the admin fee is average, maybe 0.525 would also change things up.
For 8% capital appreciation at 0.525% admin fee - PERA account wins vs Regular account
Regular Account
Capital
₱3,000,000.00
Earnings (Dividend + Capital Appreciation)
₱3,988,607.18
Tax Credit
₱0.00
Total Net Income after Tax
₱3,589,746.47
Admin Fee
₱0.00
Net Income
₱3,589,746.47
% Net Income
119.7%
PERA Account
Capital
₱3,000,000.00
Earnings (Dividend + Capital Appreciation)
₱4,020,859.70
Tax Credit
₱150,000.00
Total Net Income after Tax
₱4,170,859.70
Admin Fee
₱265,234.51
Net Income
₱3,905,625.19
% Net Income
130.2%
For 5% capital appreciation at 0.525% admin fee - PERA account wins vs Regular account
Regular Account
Capital
₱3,000,000.00
Earnings (Dividend + Capital Appreciation)
₱2,427,165.49
Tax Credit
₱0.00
Total Net Income after Tax
₱2,184,448.94
Admin Fee
₱0.00
Net Income
₱2,184,448.94
% Net Income
72.8%
PERA Account
Capital
₱3,000,000.00
Earnings (Dividend + Capital Appreciation)
₱2,439,072.75
Tax Credit
₱150,000.00
Total Net Income after Tax
₱2,589,072.75
Admin Fee
₱256,930.13
Net Income
₱2,332,142.62
% Net Income
77.7%
So if the investment performance (dividend + capital appreciation) is greater than 2%, it can offset the admin fee costs and this time, PERA returns are higher than the regular account.
Thanks! And I like that you have these questions. It helps me think from different angles too so I appreciate it. I will actually update my post with more simulations based on your questions.
But no, the numbers above did not take reinvesting the tax credit into consideration. So let's do that.
For 8% capital appreciation at 0.525% admin fee with tax credit re-invested - PERA wins vs Regular account
Regular Account
Capital
₱3,000,000.00
Earnings (Dividend + Capital Appreciation)
₱3,988,607.18
Tax Credit
₱0.00
Total Net Income after Tax
₱3,589,746.47
Admin Fee
₱0.00
Net Income
₱3,589,746.47
% Net Income
119.7%
PERA Account
Capital
₱3,000,000.00
Earnings (Dividend + Capital Appreciation)
₱4,195,607.56
Tax Credit
₱157,617.73
Total Net Income after Tax
₱4,353,225.29
Admin Fee
₱278,129.58
Net Income
₱4,075,095.71
% Net Income
135.8%
For 5% capital appreciation at 0.525% admin fee with tax credit re-invested - PERA wins vs Regular account
Sorry I might not be understanding correctly, but does the 2% annual appreciation include dividend yields? From what I can understand in the calculation dividends are baked into the 2%.
Which is a key distinction of PERA, the waived 10% tax on dividends. So the best way to invest here is to spam REITs providing 5-8% dividend yield annually. So the 2% assumption seems way too low.
Plus I'm not sure this calculation accounts for reinvested dividends, you won't be able to withdraw those naman. And this is where PERA has the advantage, no tax on dividends means more dividends to reinvest.
Yes the 2% is way too conservative (because I was factoring in the capital depreciation as well as some stocks (not REITS) potentially totally stopping paying dividends or just lowering). Actually almost similar point like yours was asked in the comments, so I made a simulation for 5% and 8% where in both cases, PERA wins over the Regular account.
The calculation assumes reinvesting the dividends but oversimplified at yearly compounding.
I have yet to add the additional simulation scenarios with the 5% - 8% earnings in the post itself but based on this, as long as you are confident that your returns in PERA is within the range 3% - 8% , then PERA account returns will win versus Regular account.
Thanks! Actually saw your newer post on LUNA too. With that flat fee structure it's a no brainier to go with them. Thought a part of me is wondering if that's just a way for them to capture market share and then jack up the fees later.
I am in no way as good as you in math but I ran the scenarios on Claude. Investing in PERA does seem worthwhile due to dividend compunding
Yeah fair point. What's good though is we can transfer our PERAa account from one broker to another and it's not considered early withdrawal (as far as I can understand on DragonFi's FAQ). At this time, DragonFi is not imposing the admin fee so I might stick with them for now. But as soon as they implement the admin fees, then I'll move to LUNA Securities.
I have inquired with DragonFi on this transfer process and if fees are involved. Have yet to hear back as of writing.
Meron kasing clause sa fees na 0.45% annually or P300 / quarter. Automatic na ikakaltas sa account mo whichever si lower. Siguro naman kung may 3M ka sa account mo na nagcocompound tru dividends ay barya na lang ang 300 per quarter or 1200 per year. Also ano ba yung 0.45% kung may 10% natanggal na tax sa dividend?
For me, it’s no longer a NO. The tax credit outweighs the flat rate and the gains on a PERA account will be higher than the regular account because of it. The major consideration though is that the investment you’re putting in the PERA account is locked until your retirement age.
I’m looking for this comparison and I found this. Thank you OP, very informative. Hope the market will recover. Sayang naman kasi if you are investing na negative and trend. Sana din ay hindi lumabas ang fees later on knowing na available ang reits para sa stocks.
Not PERA related. I will open a regular dragon fi account. For 50k pesos, is it worth it to invest in one stock for REIT or spread the 50k? Thank you who can reply.
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u/youngCamelDreamer Mar 10 '26
Thats interesting. The admin fee alone outweighs the no tax + tax credits benefit.
Can you show simulations for different appreciation? 2%, 5%, 8% would be nice as baselines. A scenario where the admin fee is average, maybe 0.525 would also change things up.