Are they about to seize your pension savings? The truth behind Mexico’s new infrastructure law

Last week, while one of the most controversial laws of the year was being cooked up in Congress, I was watching a video about wakeboarding in Barcelona: a session at Cable Park + transfers. Sounds like a luxury, I know. But here's the funny thing: over there they invest in extreme sports and entertainment, while over here, it seems they want our money to go into projects we don't even know will work. The big news is that the Senate has given the green light to the new Law for the Promotion of Investment in Strategic Infrastructure. And make no mistake, this is a big deal. It affects the pockets of every single one of us who has an Afore.

The rumour that got everyone rattled

Alerts started flying on WhatsApp and social media: "They're going to expropriate your Afore!", "The government is going to steal 30% of your retirement!". Sure, the law mentions that Afores can allocate up to 30% of their resources to these projects. If you hear that in the supermarket queue, yeah, it sounds like they've taken our money. But let's dial down the hysteria. The Mexican Association of Afores (Amafore) has already stepped in to clarify that this percentage isn't new. Consar had already updated the investment regime back in October 2024 to allow that cap for structured schemes. The new law doesn't change that limit, and most importantly: it's not compulsory.

Think of it like setting aside money at home to fix a water leak. The law says you can spend up to 30% of what you have in the envelope if you want. But if the repair is extortionate and the plumber's a cowboy, you simply don't hire him. Same thing here. No Afore is going to put your money into a project that smells like a failure. Their fiduciary duty, their legal obligation, and their very reason for existing is to protect your retirement. If they invest badly, you're not the only one who loses; they lose reputation and clients.

So what's the point of this law?

President Claudia Sheinbaum is pushing this law for a compelling reason: the current government is stuck when it comes to public investment. They need money for roads, energy, ports, and water. And who has the money? We do – workers – sitting in the Afores. The idea is to create investment vehicles (so-called VPEs or CKDs) so that private money can flow into public projects, but with clear rules.

The problem – and here's the real debate – is transparency. An opposition senator hit the nail on the head a few days ago. She asked something that keeps me up at night: Who decides if a project is profitable? According to the small print, the committees are defined by the government. That's like asking the fox to guard the henhouse. If the committees are packed with officials who need to sign off on the boss's pet project, who puts the brakes on?

• The spectre of losses: The senator gave some painful examples: the Maya Train or the AIFA airport. No matter which side of the political fence you're on, the numbers don't lie. We're talking about millions in daily losses. If your Afore is forced (even if they say it's not compulsory, the political pressure is huge) to pour money into a black hole like that, say goodbye to your returns.
• The State guarantee: If a project goes bust financially, the State pays up. With what money? More debt. This puts Mexico's credit rating at risk. If we lose investment grade, financially speaking, we're screwed. Interest rates skyrocket, and we all end up paying more.
• Voluntary savings are the key: In the midst of this uncertainty, experts recommend not relying solely on your Afore. The current system (the '97 Law) will give us a pension of barely around 30% of our last salary if we do nothing. That's where PPRs (Personal Retirement Plans) come in. It's the only way to have real control.

Speaking of having control, while I was watching the political mess unfold, I remembered a setup I saw in Northern Virginia last year. Over there, they have a network of smart toll roads that not only eased traffic congestion but generated huge capital gains for local pension funds. That's proof it can be done. I'm also reminded of the Forth Bridge in Scotland, a century-old engineering marvel that's still standing and turns a profit through tourism. Infrastructure can be an excellent business if it's planned properly. The fear here isn't investment; it's the lack of professionalism and political overregulation.

So, what do I do with my Afore?

Look, I'll be straight with you as if we were having a pint. They're not going to forcibly take your money. No 'coyotes' like the news mentions are going to rob your account. But there is a risk that if we don't pay attention, the returns over the next few years will be rubbish because they'll pour the money into vanity projects. As a colleague from the financial world told me, 2025 was a historic year with capital gains of over a trillion pesos, but 2026 has already started with mass withdrawals due to unemployment and a more volatile market.

My advice, after a decade of watching this financial circus play out, is to educate yourself. Check your Afore's net return. If it's near the bottom, switch. It's free and it's your right. And if you can, even just a little, open a Personal Retirement Plan. The tax deduction comes back to you from the Revenue Commissioners the following year, and you get to decide where that money goes: you can put it into equities in the US or leave it in safe debt. Don't leave your future in the hands of politicians. Because while they're deciding whether your money goes to an empty airport or a refinery, they might just be dreaming of a wakeboarding trip to Barcelona.