Sharing you some financial tips that every Overseas Filipinos should know
Many Filipinos choose to leave the comforts of their homes for better opportunities abroad. Because of the higher take-home pay, no matter how hard it is to leave their loved ones behind, Filipinos are willing to work abroad just to be financially stable. They are actually the country’s modern-day heroes — they work in a foreign land to provide a better future for their loved ones.
There are 2.3 million OFWs in 2018 but sadly, many still weren’t able to attain that goal even after years of working abroad which results to inevitable migration — working abroad for an indefinite period of time. This happens mostly due to unsound financial management. That is why BDO Foundation (BDOF) aims to educate Overseas Filipinos through a financial literacy program that will be able to help them attain that goal and return back home. I’m attaching this clip fortunate that I got invited as an OFW’s relative to learn more about handling our family’s financial resources. Click on.
The grass is not always greener
I, myself, have a sister who is an Overseas Filipino worker. My parents used to be OFWs as well. I grew up seeing my dad only once or twice a year. It is true that the grass is not always greener. Being an OFW doesn’t mean that life is always good and based on our family’s experience, it will not guarantee you financial stability if you don’t know how to manage your finances right (you and the recipient of your remittances).
Vital part of the economy
Did you know that Overseas Filipinos are a vital part of the Philippine economy? This is because of the impact of their remittances which continuously grow as more and more Filipino workers have found jobs abroad. Early this year, BDOF partnered with Overseas Workers Welfare Administration (OWWA) and Bangko Sentral ng Pilipinas (BSP) for a financial literacy program targeting Overseas Filipinos, their families, and recipients of remittances. This program called PiTaKa or Pinansyal na Talino at Kaalaman, is in line with BSP’s National Strategy for Financial Inclusion and to develop a financially literate citizenry.
PiTaKa or Pinansyal na Talino at Kaalaman, is now a requirement in both Pre-Departure Orientation Seminar (PDOS) and Post-Arrival Orientation Seminar (PAOS) of every Overseas Filipinos. This program aims to eventually change the financial behaviors of Overseas Filipinos — from being spenders to regular savers, investors, or business owners. This also aims to help Overseas Filipinos have the capability to sustain their financial health and at the same time productively contribute to the national economy while living together with their families in the Philippines.
Whether you’re planning to work abroad or already working abroad, we all know what you’re main goal is, and that is to attain financial freedom. Here are some of the tips you need to know as an Overseas Worker.
1. Proper Budgeting
It is very important that you create a budget and strictly follow it. Prioritize to pay off your debts and lessen your unnecessary expenses. Based on my sister’s experience, she created her own budget flow abroad which includes the amount of money she will spend there, the amount that will go to the bills that need to be paid, and of course, her savings.
2. Save, save, save
As an Overseas Worker, you must learn how to save your income. You worked hard for it, so don’t let it go to waste. Set aside an amount from your salary for your savings. Don’t just rely on the recipients of your remittance to have savings. Based on the 2nd Quarter (2019) Consumer Expectation Survey of BSP, only 33.9% of the households surveyed put the remittances that they receive into savings and only 7.6% put them into investments. You must have your own savings as well abroad. You’ll never know when it will come in handy.
I remember back then, my dad used to send remittances to my mom when he was still working abroad. Sadly, due to a number of expenses, my mom wasn’t able to save money from the remittances that she received. And when the time came that my father lost his job abroad, we don’t have much money left. Luckily, my dad was able to save a little from his salary though it was not enough. That’s the downside of sending all your money back to the Philippines. Remember, your work abroad is not forever. So it’s really important to have your own savings.
3. Find ways to grow your income
Investments are one of the best ways to prepare for your post-OFW life or build your retirement fund. And there are many ways to invest at instead of spending all your money with nothing in return.
a. Real Estate
Real estate can bring great returns. It is one of the preferred investments for OFWs since it is a tangible asset compared to others (stocks and mutual funds). Besides, it is good to have your own place instead of renting. You can also use your properties to make additional income through short-term rentals via online platforms like Airbnb. And you can also sell it in the future giving you a large cash reserve.
Owning a business is also another great investment for OFWs. It’s another source to earn additional income. You can start with small franchises like food carts and kicks. But remember to always have a buffer of emergency fund, just in case things don’t go well. It is also better if you do some research first on what is the trending businesses today before getting one. And if you’re planning to work with business partners, choose someone who you can really trust because you are not always in your home country.
One of the famous investments nowadays is stocks. With the rise of online trading platforms, OFWs can now invest in stocks even if they’re based abroad. One of which is COL Financial, an online broker. They allow OFWs to open a trading account without a personal appearance. If done right, stock investing can grow your money. You can possibly get annual returns of 50% with this investment but of course, you need lots of effort to make this happen.
d. Mutual Funds and UITFs
For as low as PHP1,000, OFWs can invest in mutual funds and unit investment trust funds (UITFs). Look for mutual fund companies to open an account for mutual funds while UITF accounts are available in most banks but require a personal appearance.
These are just some of the ways you can grow your money. You’ll learn more about it in the financial literacy seminars of BDOF. Be financially inclusive. Learn more about the financial literacy program of BDOF on BDO Unibank’s channel on Youtube.