Tag Archives: Financial Planning

Impact of Global Investment Trends on OFW Finances and Opportunities for Investment

26 Monday Aug 2024

Posted by in Personal Financing

≈ Leave a Comment

Tags

, , , , ,

The current positive outlook in global and Philippine investments is having mixed effects for Overseas Filipino Workers (OFWs). While a stronger peso means a lower exchange rate—currently 1 SAR equals 14.82 pesos, compared to the previous 15.5 pesos—this doesn’t necessarily translate to lower living costs in the Philippines. For OFWs with fixed-rate mortgages, the benefits of a stronger peso may be offset by stagnant prices of goods and materials.

Despite the exchange rate improvement, prices for essentials and materials in the Philippines remain high, which can strain OFW budgets. Additionally, if this trend continues, interest rates may eventually decrease, but this hasn’t yet alleviated the current cost pressures.

It’s crucial for Filipinos to adapt to these changing financial conditions by exploring investment opportunities. Investing in Real Estate Investment Trusts (REITs) or mutual funds offers a chance for passive income and potential growth. Now is the time for OFWs and other Filipinos to consider these options to enhance their financial stability and take advantage of rising investment opportunities.

How I Discovered the Importance of Emergency Funds: A Simple Guide for Filipinos

24 Saturday Aug 2024

Posted by in Personal Financing

≈ Leave a Comment

Tags

, , , , , , ,

I have to admit, I had no idea what an emergency fund was until I stumbled upon a YouTube video from ANC Money. They broke it down so well that it finally clicked for me. So, what exactly is an emergency fund? It’s basically a stash of cash that you can tap into when life throws a curveball—whether it’s an unexpected medical bill, car repair, or even a job loss.

Emergency Fund

According to a financial adviser featured on ANC Money, your emergency fund should ideally cover 3 to 6 months of your monthly expenses. This got me thinking: “Do I even have enough saved up for a rainy day?” Spoiler alert—I didn’t.

Here’s something else I learned: your emergency fund doesn’t have to just sit in a savings account gathering dust (and barely any interest). You can actually put it in an investment portfolio that allows you to withdraw within three days if needed. This was a game-changer for me! All along, I thought a bank was the only place to keep an emergency fund, but it turns out there are better options out there.

The key is to find a place where your money can grow faster than it would in a regular savings account. It’s like hitting two birds with one stone—you’re prepared for emergencies, and your money is working for you.

As for me, I’ve got stocks through COL, but no emergency fund…yet. My plan is to start saving 10% of my salary every month until I build up enough to cover 3 to 6 months of expenses. It might take a while, but I’m determined to get there.

Cost of Ignorance vs Financial Literacy

21 Tuesday May 2013

Posted by in Personal Financing

≈ 9 Comments

Tags

, , , , , ,

They say that Financial Literacy Seminar and Financial Investment is too expensive for people to start and I say it is more expensive to be ignorant than to get Investment portfolio such as Insurance , Mutual Funds and other investment.

Let me explain my point.

Most people when asked about their savings and investment, they will just reply, “I don’t have investment, it is only for the rich”. It is the reason why our society needs to be educated about financial literacy.

Ignorance

Saudi OFW who goes back to Philippine with Final exit normally gets End of Service Benefits (ESB) from his employer. This is worth 50% of his/her monthly salary per year for the first 5 years and 100% of monthly salary for the next year of the total service rendered. The problem; whenever an ofw goes to Philippines without any financial literacy, chances are this money will only last for few months and end up being poor while in Philippines. It is also the reason why many old aged ex Saudi want to go back to Saudi to work again.

I can give you an example, let say an OFW earns 5,000 riyals per month (assuming it is his latest salary), and he stayed on his company for 15 years. This will be his computation:

  • First Step : 5,000 x 0.5 x 5 years = 12,500
  • Second Step : 5,000 x 1 x (15-5) years = 50,000
  • Total take home = SAR 62,500 = approx. Php 675,000

Imagine working for 15 years in Saudi Arabia who have no knowledge in Philippine Business, put his ESB in business and ended up of becoming bank craft.

Financial Literate OFW will definitely think of something on how he can grow his money, taking into consideration different risk that he will face on his venture on investment while,

An OFW without any Financial Literacy Background will definitely spend 10% or more for “Pasalubong”, then after arriving in Philippines “Painom” and more. This is just to tell everybody that he came back from overseas work. His friends will approach him to open a business and gives his money with no proper feasibility study. So what do you think will happen to this OFW? Will he enjoy his retirement?

Financial Literacy is important for all of us. Ignorance is the most expensive things in the earth as well as ignorance can also be equated to gambling. Any business without proper study will have high chances of business failure.

Learning Financial Literacy does not mean you don’t have faith in the Lord. Financial Literacy is preparing for your future and having faith that the Lord will help and guide you in your plan.

I always believe in If You Fail to Plan, You Plan to Fail.

Proverbs 22:3 ESV

The prudent sees danger and hides himself, but the simple go on and suffer for it.

Be wise on your hard earned money.