Stipulated in 1981 by former dictator Augusto Pinochet, the AFP system - which means Pension Fund Administrators - is, to this day, highly questioned by chilean society for not bringing the advantages once promised to the population.
Workers have to contribute, mandatorily, with 10% of their salaries each month. The money applied is used for private financial investments, but the return in terms of pension is very little - around 30% of worker’s last salary before retiring.
In Chile today, 90% of retired people receive less than 147 mil pesos (US$225). This amount is almost half the minimum wage - which is around US$450.
In 2018, president Sebastián Piñera presented a measure to raise contribution from 10 to 14%.
María Luz, 70, has to work as a concierge to make ends meet and help sustain her family - she lives with 3 of her kids and a granddaughter in Santiago.
Published in Folha de S. Paulo.