The impact on mexican pensions for individuals affiliated with the 1997 IMSS law, stemming from changes in the 1973 Law, and their level of knowledge on the subject in 2023

Abstract

The shift from the 1973 to the 1997 IMSS pension law has introduced a more complex calculation methodology and is projected to result in significantly lower pension amounts. These changes collectively pose a potential future societal challenge. This study investigates the differences in pension calculation results between the laws (including the latest modifications), analyzes the projected return rates supported by mathematical formulas based on payments varying in geometrical progression annuities from Kellison, and assesses the knowledge level of Mexican workers regarding these pension systems. Based on a survey of 570 respondents using statistical approach; the findings reveal that 92% to 97% of Mexican workers lack sufficient understanding of pension matters. Furthermore, 77.7% to 86.9% do not have an alternative pension plan. The analysis concludes that the 1997 law will yield lower pension benefits compared to the 1973 law, with projected return rates falling below 50%.