Retirement Funds Administrators (AFORE) are companies authorized to manage Mexican individual retirement accounts as authorized by the Ministry of Finance and Public Credit of Mexico. They are structured as companies that manage these funds under strict regulations. These administrators are regulated by the Comisión Nacional del Sistema de Ahorro para el Retiro (CONSAR). AFOREs manage accounts that accumulate contributions by the employer, the Mexican federal government and the employee. The fund will then payout on retirement of the employee at the age of 65 or on other specific criteria.

Sub-accounts

Individual retirement accounts are split into four separate sub-accounts which are:

Retirement, lay-off and old age

This sub-account contains funds contributed by the employer, federal government and employee.

Voluntary contributions

An employee may also contribute extra funds voluntarily. Additional contributions may be done directly with the AFORE or automatically deducted from the employee's salary.

Housing

This is a sub-account into which employers contribute an equivalent of five percent of the employee's salary. Funds are deposited with the INFONAVIT through the Fondo Nacional de la Vivienda ("National Housing Fund") and the AFORE only registers contributions and balances.

Complementary contributions

This sub-account will contain additional funds contributed by the employer or the employee to increase the pension balance. These funds can only be withdrawn after retirement.

Withdrawal criteria

Withdrawals of funds from these accounts is possible under certain situations such as: