Tag Archives: financial

“Now is the time to invest,” says Sun Life Asset Management as sales expand by 50% in 2016

Financial literacy is a topic that is very dear to my heart. As someone who didn’t know anything about savings and investing, I struggled early in life financially – not because I was wanting but because I was irresponsible.

When I was younger, I was one of the “one day millionaire” kids who go through hard-earned salary in a matter of days, spending it on shopping, food and my many juvenile hobbies that I always end up in the red days before the next payday.

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I spent my twenties subsisting paycheck-to-paycheck, not because I do not have enough in life, but because I was too irresponsible to fix my own finances. The sad thing is I am not alone. A recent study by Standard & Poor’s (S&P) showed that only 25% of Filipinos understand financial literacy.

“While the array of financial products available in Asia continues to grow rapidly, S&P’s FinLit Survey suggests that most consumers lack a general understanding of credit, compound interest and other key concepts,” the ratings firm noted. (SOURCE)

In a recent media briefing, leading Financial organization Sun Life Asset Management Company, Inc. shared the good news that the Philippine economy continues to grow strong. In a media statement, Sun Life Chief Investments Officer Michael Enriquez explained that with the increased consumer and government spending, the outlook remains fundamentally positive:“Remittances from overseas Filipino workers, the BPO industry, and the large number of Filipinos who are of working age are among the factors boosting our economy from the consumer’s end. On the other hand, the rise in government spending is bringing about more jobs and has also increased the demand for construction materials.”

Enriquez advised investors to stay the course, and even boost their investments. “With stock prices cheaper, it’s a good time to buy so they can enjoy the greater gains once the market goes up,” he said.

This is the best opportunity to invest in Mutual Funds, Enriquez advised.

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Photo credit: Sun Life Facebook page (here)

One way to take advantage of this scenario is by investing in mutual funds, such as the Sun Life Prosperity Funds managed by Sun Life Asset Management Company, Inc (SLAMCI). The Sun Life Prosperity Funds have been performing strongly amid the developments in the market. The Sun Life Prosperity Philippine Equity Fund, for instance, yielded a five-year return of 39% and a 10-year return of 119%; while Sun Life Prosperity Balanced Fund marked a 28% and 89% growth in the five and ten-year return respectively; and the Sun Life Prosperity Bond Fund lodged a 12% and 44% return for the same duration. The said figures are as of December 31, 2016.

“We’re delighted that our investors are reaping the rewards of their commitment to invest for the long-term, and we hope to see more Filipinos treading the same path so they too can experience financial security,” SLAMCI President Valerie Pama said.

As a leading financial organization, Sun Life espouses the importance of financial literacy among Filipinos. This is something that the company spends time and effort as part of its advocacy, Pama shares. To do this, the company conducts active engagement of new financial advisors and even rolls out free seminars on financial literacy that are open to the public.

I can relate. After my disastrous twenties, I finally settled into a more responsible financial outlook when I started my 30s. I began a triple bank account dividing my monthly salary, savings/emergency account and travel account. I started buying insurance – maintaining accounts on two different insurance companies. Two years ago, I discovered Mutual Funds and Sun Life and began my investment with just PHP5,000. I figured that all my hard work and all that overtime work will go to waste if I don’t start investing in my future. One day, my health will fail, I will retire but will still have a fairly-comfortable lifestyle, thanks to my savings and investments.

The recent pronouncement of SLAMCI gave me courage to be more bullish on my investments. My mutual fund with Sun Life still needs a lot to be desired and are on the very conservative side. The bullish approach and the positive economic outlook as announced by the company gave me the idea to shift the fund into a more risky approach across a ten-year period. Currently, I am still crunching numbers but hopes to achieve this dream within the year.

Considering the volatility of the economy and what ever may be happening in the world, I am comforted with the fact that SLAMCI continues to look out to its many customers. Their advocacy to financial literacy is slowly chipping away the notion that “investing is complicated.” With proper knowledge and research, and with a company you can depend on like Sun Life, a brighter tomorrow is possible.

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Why is it hard to be financially responsible?

Infographic from the Money Summit & Wealth Expo 2012
Infographic from the Money Summit & Wealth Expo 2012

How do Filipinos rank in financial literacy?
News from Rappler, 16 July 2013

The Philippines recorded 68 index points and ranked 8th among 16 Asia-Pacific countries covered by the latest MasterCard Index of Financial Literacy.

The Philippines’ score in MasterCard’s 4th annual survey is almost the same as the Philippines’ index score of 68.2 in 2011.

“This Index of Financial Literacy is a good measure of whether and how people in the Asia/Pacific region are making informed decisions around their home finances,” said Georgette Tan, MasterCard’s group head of Communications, Asia/Pacific, Middle East & Africa.

The recent survey, released on July 3, was conducted with 7,756 respondents aged 18 to 64 from Asia/Pacific markets between April and May 2013.

Three major components are considered in the calculation of the final index score: basic money management (50% weight), financial planning (30% weight) and investment (20% weight). Regional Aggregates had been calculated via the average of the components of individual countries before these weights were applied.

Philippine respondents rounded up 67 index points for basic money management, 74 index points for financial planning and 58 index points for investing.

The ability to manage money involves skills such as day-to-day budgeting, paying up bills, handling credit commitments and saving up for big purchases. Investment proficiency includes understanding bank statements and complex investment concepts.

New Zealand remained at the top of the list, with 74 index points, and also in matters related to fundamental money management skills. China has come out as the most proficient in investment, Myanmar in financial planning.

Japan fell at the bottom of the chart with its overall financial literacy at 57 index points.

“There are divides across our markets that reflect the gap between the developed and the developing. Financial literacy is a concern where a large proportion of society are without the support and education that is taken for granted in the developed world,” Tan added.

A developing country, the Philippines was the sole market from the list to have low levels of financial literacy from the demographic of 30-year-olds who are married at the same time. Becoming financially savvy is more pronounced with marriage and increasing family obligations, such as household expenses, education and financial commitments.

Link to original site here

saving is a bitch
saving is a bitch

How about you? Do you find it easy to arrange your finances and set it in order?

For almost five months now, putting my finances in order has been my sole obsession. I don’t know what prompted my quest to scrimp, save and invest aside from the fear of dying and leaving nothing to my family in spite the crazy hours I spent working.

As embarrassing as this may sound, my financial IQ is nil and almost non-existent. I lack the discipline to save my money and look the other way when it comes to my wants and not needs. I am currently trying a lot of ways to save, invest and keep. I’ve read somewhere that 10% of our salary should go to our savings, 20% to our investments (different from the rotating money in the bank) and 70% should go to our day-to-day expense.

I wish I could tell you that everything is going according to plan and that all my savings are growing according to the same gaant chart that I prepared with gusto. However, the reality is that, like any other Filipino, my monthly expense sometimes outweight my monthly earnings. Instead of allotting money first for my investments (mutual and emergency fund) and savings (revolving fund) accounts, what happens is that I am forced to pay for my bills before I set money for my savings. According to the many investment and financial websites I have studied, what is correct is to pay yourself first before you pay others.

Here are some financial literacy tips from Investopedia

1. Responsible use of credit cards
If you have a credit card and you’re barely paying the minimum payment due per month, then there is something seriously wrong with your financial spending. Credit cards are convenient tools and provides you financial flexibility but they shouldn’t be taken in as substitute to cash. Stop using your credit cards to pay for your wants (yes, very easy to say when there’s no H&M, Forever 21 or GAP near your office). Credit cards should be used for emergency expenses only (thing is: a plane ticket qualifies as an emergency to me).

2. Pay yourself first
As mentioned earlier, make it a habit to pay yourself first before you start paying your bills and other obligations. Since this is the part of my financial journey where I struggle the most, I am planning to do something to improve how I do this. One plan is to NOT use my money, and not withdraw anything unless I have paid myself using the medium I discovered — 10% savings (revolving funds) and 20% (investment/emergency funds).

3. Have an emergency fund in hand
Shit happens — people get sick, appliances get broken, unemployment happens and insane discounted tickets to Japan gets announced (kidding on this one); it’s best to always have money in store to use for instances such as these. Since I was young, I was told that one must have at least three times the worth of her salary in her bank account. But apparently, amount should be equivalent to six times your salary in order to cover living expenses and even cases like hospitalization.

4. Stop keeping up with the neighbors
Just because your neighbor happened to buy a new car doesn’t mean you have to line up to the dealership also. Be contented with what you have. Your neighbors do not pay your bills, so their opinion doesn’t and shouldn’t count on how you live a financially-independent life.

5. Have a budget
…and stick with it.