The Ultimate Money-Saving Tips For 2021

If there’s one thing many people will agree on, then it should be nothing is more important than having savings. 2020 taught us the value of saving and living simply, we plan to continue that this 2021. A lot of businesses closed or scaled down their operations, which led to loss of jobs. Many OFWs were also sent home and despite the financial assistance, P10,000 is simply not enough to survive.

This is why this year, saving is and will be a priority. Here’s the ultimate list on how to save money this year – and beyond:

  1. Health is wealth. At a time like this, nothing beats being healthy and making sure that you are Covid-free. We cannot afford to get sick at a time like this because aside from possibly infecting the people around you, it entails costs, too. Therefore, eat healthy, exercise regularly, and sleep well.
  2. Budget is life. Setting limits and allocating a specific amount for each expense not only prevent overspending but also ensure that money is well-spent. Just make sure you’ll stick to it to maximize its benefits.
  3. Track your spending. You need to know where your hard-earned money is going. Therefore, make a list of every expense, regardless of the amount. This will give you an overview on where you can cut back in order to save more.
  4. Emergency fund is a must. The importance of emergency fund was highly emphasized last 2020. This type of fund is intended to, well, help you during emergencies, which means it should give you at least three months-worth of cash on hand. Take it one P100 bill every week because you’ll never know when you’ll need it.
  5. Know thy prices. One of the beauties of online platforms is that goods are more accessible. However, this could mean more sellers are selling the same items. Before you commit, make sure you check the prices to make sure that you get the most competitive price.
  6. Think before you click. Or add to cart. Online shopping is tempting and sellers will constantly come up with ways to entice people to buy. Before you add to cart, think hard first. Do you really need it? Is it useful? Is it worth the price? Can it wait? If two or three days passed and you still want it, then maybe it is worth it. Don’t let your shopping impulse control you.
  7. Home-cooked meals over takeouts. Restaurant food is tempting, especially during lazy days. Unfortunately, getting too much takeouts can strain your budget. Nothing beats home-cooked meals because aside from generous serving, they are way cheaper, too.
  8. Save electricity. Whether it’s turning off the lights or unplugging unused appliances, these little acts could make a difference in your electricity bill.
  9. Get rid of unnecessary subscriptions. Anyone in the family probably signed up with monthly subscription services. You might not be using your cable TV that much. Regardless, discontinuing subscriptions services could help you save more, which you can use to build your Emergency Fund.
  10. Say goodbye to vices. Similar to pricey subscription services, vices such as smoking or alcohol equates to costs. Quit these vices because you’ll not only save more financially but also, you’ll save your health.
  11. Don’t follow trends. You’ve seen a lot of trends online like fusion of food or even plants. As tempting as it looks, don’t easily give in. Following trends means paying for something, which also means you have to allocate a certain portion of your budget for that item. Unless you are passionate about it, say plants, don’t join the bandwagon.
  12. Sales are okay. Whether it’s 11.11 or 12.12, sales are fine AS LONG AS you stick to a budget and you only buy what is essential. Online sales are not an excuse to splurge. Stick to the basics because you’ll never know when you will need cash.
  13. Pay bills on time. This is a must. Although utility companies give grace period, it’s still not an excuse not to settle those bills. Aside from possible disconnection, you will be required to pay for penalty fees and reconnection fee in case you want to still avail of their service.
  14. Pay loans on time, too. Apart from the bills, it is recommended that you pay off any existing loans. You’ll be able to save more because you don’t have to worry about interest fee anymore.
  15. Stick to a grocery list. This is also important. The supermarket can be a tempting place because of tons of food. Make sure you’ll buy only and only what you need. Avoid overspending and always stick to your list.
  16. Take it easy on loans. Loans can be a good way to augment your financial needs. Unfortunately, this could be a cause of downfall, too, especially if you’re not too careful. Therefore, apply for a loan only when necessary. Make sure to “shop” for lenders and check which among them will give you a reasonable rate and loan terms.
  17. Delay what you can. Do you really need a new smartphone? Is there a need to buy new shoes and clothes? Do you really have to get your hands on the latest Play Station? The point is if you can delay your wants, then much better.
  18. Learn to say NO. Most people think that being an OFW means you have a “deep cash well” since you earn in dollars. You’ll have relatives or friends coming over and asking if they can borrow money. Learn on how to say no politely. You’ll never know when you will need your funds, so it’s better to be prepared.
  19. Saving is a family thing. Parents are not the only ones who should adjust and make saving a habit. Every member of the family must take part in it. As parents, now is the best time to educate your kids on the importance of saving and living simply. Make this as a family effort and you will reap the rewards in no time.

Are you ready to follow this list? 2021 is a good start to start with good saving habits.

How To Get A Police Clearance Online

Pandemic resulted to many things, including your job overseas. Now that you’re back home, you are now looking for means to sustain you and your family’s needs. This means you’re back to job hunting.

Part of local employment is submitting tons of requirements, including police clearance. This pre-employment requirement is crucial because police clearance is a document that proves that the person has NO criminal or derogatory record based on the Philippine National Police Database.

Police Clearance is also valid for six months and comes with a unique QR code, which signifies authenticity.

Here’s some good news: you don’t need to line up, apply for a police clearance, and wait for an hour to get it. Through their website, you can now schedule an appointment and pay for the fees online. Unfortunately, the system does not support – yet – full online application. This means you still need to go to your chosen police station to get your biometrics and photo.

Nonetheless and to avoid the possibility of spreading of the virus, here’s how you can apply online.

Step 1: Prepare all your requirements.

Two valid IDs are needed when applying for a police clearance. These IDs must be original, not expired, and contains your name, clear photo, and signature.

Acceptable IDs include:

  • OFW ID
  • Passport
  • Philhealth ID
  • GSIS ID
  • SSS ID / UMID
  • TIN ID
  • Voter’s ID
  • Driver’s License
  • Postal ID

In case you can only present one ID, make sure you can provide a Certified True Copy of your Birth Certificate, preferably with original receipt.

Step 2: Register

Once you prepared all the documentary requirements, it’s time to register for an account with National Police Clearance System.

Also known as NPCS, this website provides online services to Filipinos to streamline and make application easier.

To register, visit the NPCS website, which you can also access here.

Click Register. The next screens will show Terms and Conditions. Make sure to read through each slide, check the boxes, and then click Next. On the last slide, click I Agree.

Thereafter, fill in the required details. Make sure that your email address is active and you know the password to be able to log in since this will be used to communicate with you.

After registration, check the confirmation message sent to your email address to verify your account. Then, click the verification link.

Step 3: Edit Your Profile

Sign in to your online account using your registered email address and password.

Once you logged in, click the Edit Profile and fill in the necessary details. Make sure that you click the Save Profile button.

Step 4: Online Appointment

After editing your profile, it’s time to set an appointment.

To do this, click Clearance Application button. Then, choose the nearest police station where you can get your police clearance. After, you will see the available schedules. Choose your desired schedule and then click Next.

To confirm your appointment, click Land Bank of the Philippines and then Save Appointment.

Take note that payment details will be displayed thereafter. Take note of these details, especially the reference number since you will use this for payment of police clearance.

Step 5: Payment

This is the limitation of this service. After setting an online appointment schedule, the rest must be done face-to-face.

At this point, you need to pay for the police clearance fee amounting to P160.00, which includes both the clearance fee of P150 and transaction fee of P10.

If you pay through Gcash, then input your Gcash account number in the LBP ePayment portal. Thereafter, it will display transaction details and payment summary.

If you prefer more convenience, then you can also pay through 7/11. Here’s how:

  • In the LBP ePayment portal, click Cash Payment and then click Submit.
  • Choose 7-Eleven as your payment channel and then click Proceed. Make sure that you copy the payment reference number and then pay it using 7-Eleven’s CliQQ mobile app. Make sure that you have a registered account with CliQQ to proceed.
  • Login to your CliQQ account. Choose Government from the list of billers.
  • Choose MYEGPH from the options. Then, enter the Reference Number, mobile number, and amount. Take note that for the amount, it should be P180.00 since the transaction or convenience fee is P30.00
  • Then, click Confirm. A bar code will be shown, which you will use when paying for your police clearance through the nearest 7/11 branch.

Step 6: Scheduled Appearance

Head to the police station on the day of your scheduled appointment. Make sure to bring two valid IDs, reference number from the NPCS website, and official receipt of the payment of Police Clearance. Present these documents to the officer-in-charge.

Thereafter, you will go through biometrics capture and then have your photo and signature taken.

Verification process will follow where the police officer will check your records on the PNP database. Don’t worry since this will only take minutes. Once ready, your name will be called to pick up your Police Clearance.

What happens if you have a hit?

In that case, you will have to undergo another verification process. Once this is settled, you can get your Police Clearance.

This is a good step towards automation and making everyone’s lives easier. Sadly, they cannot do away with the face-to-face because of he biometric processes but nevertheless, this is an improvement of service.

In the meantime, take advantage of this service.

6 Financial Decisions You Need To Avoid In The New Normal

Since the start of the lockdown in March, one cannot help but feel anxious about what will happen in the future. All of a sudden, you can’t do the things you normally do – go on a vacation, have a quick trip to the mall or grocery, going out with your family, attending parties with friends, and the list goes on. There are uncertainties in terms of job security or continuing your kids’ education.

This is why at this point, you need to be more careful and wise when it comes to how you will spend your money. Handling your finances could make or break your financial stability, which means you need to think twice – or thrice! – when it comes to these financial decisions:

Starting A Business

Starting your own business is fine. But if you will start a business that could possibly deplete your cash on hand, then you need to think twice if this is a best decision.

It is best to start small first and see where it goes. Using your Emergency Fund to fund your business is not the wisest decision at this point because you need to be prepared for eventualities.

Also, don’t give up on finding a new job in case you are one of the thousands who were sent back home because of the pandemic. While having a side business is okay, looking for a stable employment could help you weather the rainy days.

Hoarding Essentials

Compared to March and April 2020, going to the grocery now is easier because you don’t have wake up early and wait to go through horrendous lines.

That being said, there is no need to hoard. You don’t have to worry about the supply of goods because you will never run out. Stick to your budget because you will still need your cash to pay for other things, say utility bills.

Impulse Purchase

E-commerce platforms like Lazada and Shopee have been hosting monthly sales to entice people to buy. While there are tons of good deals up for grabs, this doesn’t mean it’s your license to buy whatever you want.

Sure, you deserve good things, too, but at this point, it is best to stick to essentials. Focus on the items that you will need at home and look for deals related to that. This way, you can enjoy more savings , which you can use to other equally important expenses.

Riding The Bandwagon

If you noticed in social media, #plantita and #plantito are everywhere. You will also see new food offerings that will definitely make you drool. There are also viral recipes or hobbies that entice you to do at home.

Before you join, check on your wallet first. Doing what others are doing just because is not advisable. Taking out a loan just to fund that new hobby is also not recommended.

Unless you are passionate about what is uso, use your time and money wisely. Go for something that will benefit you and your family more.

Taking Out Loans

Loans can be helpful. It gives you a breathing room to spend money, assuming that you will use it for a good cause. But if you will apply for a loan just to finance non-essentials or purchases that can wait, then you might want to think twice.

Applying for a loan means you need to pay interest on top of the principal. You need to take note of the due date, too, otherwise, you will be forced to pay penalty fee.

Therefore, think twice before you apply. Otherwise, you might end up in a pile of debt if you keep taking out loans just for the sake of borrowing.

Withdrawing Investments

Investments are meant to last long. In fact, you will enjoy the earnings more if you leave your money.

It’s a different case if you’ll withdraw your investment. Aside from the early termination fee, you might compromise the possible earnings and growth of your money. Unless you really need it, say payment for medical bills or tuition fee of your kids, keep your money first.

These are uncertain and challenging times but it is not an excuse to make impulsive decisions that could compromise your financial standing. Limit your spending to essentials, set up a budget, get rid of unnecessaries, and look for additional ways to earn money.

Hang in there and soon, we will be back to what we used to be.

PERA Investment: Pros, Cons, And Going Digital

One of the inevitable truths we need to face is that we will get older. As each year comes by, you will notice changes in your movement, memory, and skills. This is why it is important to prepare for your later years, also known as retirement.

Have you started with your Retirement Fund? If not, then it’s not too late. There are several options that allow you to grow your money such as long-term Time Deposit, mutual fund, UITF, or even stocks.

If you prefer something safer with minimal risks, then consider PERA Investment.

What is PERA Investment?

Similar to US’ Individual Retirement Account, PERA’s aim is simple: to provide a voluntary retirement program for Filipinos.

PERA is a long-term and tax-free retirement program to encourage Filipinos to start saving for retirement. Your contribution of up to P200,000 every year will be invested in the following:

  • Unit Investment Trust Fund
  • Mutual Fund
  • Stocks from PSE-listed companies
  • Government securities
  • Insurance pension products
  • Annuity contracts
  • Other investment products authorized for PERA purposes

Keep in mind that PERA will not replace SSS pension, rather will supplement the money you can get come retirement age.

How Much Can You Earn?

Earnings vary depending on where the money was invested. Since PERA contributions are invested in various investment channels, the returns are different.

For instance, UITF and mutual fund will give a higher return compared to time deposit. However, this is a safer option compared to stocks. When money is invested in stocks, the return is higher than UITF and mutual fund, although the risk involved is higher.

In other words, the higher the risk, the higher the return.

Why Should You Open A PERA Account?

  • Income Tax Credit – Account holder is entitled to five percent Tax Credit of total PERA contributions.
  • Tax-Free Investment Income – This means the investment is exempted from capital gains tax, final withholding tax, and regular income tax.
  • Estate Tax Exemption – Upon death and when assets will be transferred to the heirs, an estate tax of six percent of net estate, which means all liabilities were deducted, will be imposed. PERA Investment is exempted from that and in fact, the money will be transferred directly to the heirs.
  • Control PERA Investment Products – When you invest in PERA, you have the control on where you want to put your money, depending on your risk profile. There are variety of choices to choose from so make sure you check and study what product is more suitable for you.

When Can You Withdraw Your PERA Investment?

To withdraw, you need to remember the 55 and 5 Rule. This means you will be allowed to get your investment by the time you reach 55 years of age AND you contributed for the last 5 years.

You can either get it in lump sum or choose monthly pension for a certain period or within your lifetime.

Still, there is an exception. In case the investor or account holder is sick for more than 30 days, becomes permanently disabled, or has passed away, the investment can be withdrawn.

What Are The Drawbacks Of PERA Investment?

There are several. Just like any other investment options, PERA comes with risks, too. This form of investment is not exempted from price fluctuation, crash in the stock market, or lowered interest rates. This is why it is important to check every investment option first before you decide where to invest.

Another risk would be penalty for early withdrawals. Although there are early exemptions like serious illness, permanent disability, or death, you have to wait until you satisfy the 55 and 5 rule to enjoy your benefits.

What happens if you withdraw earlier? Then you won’t be able to enjoy the benefits, specifically the tax benefits.

Lastly would be the costs. Every time you make a contribution, you will pay one percent administrator’s fee plus trust and custodian fees of 0.5 percent to 1.5 percent.

To reduce the instances of paying these fees, it is best to contribute in lump sum instead of doing this every month.

PERA Goes Digital

BDO, BPI, Landbank, and Metrobank are the only banks authorized to offer PERA. This means you need to go directly to the bank to be able to apply.

Thankfully, Digital PERA was launched by the Bangko Sentral ng Pilipinas last September 2020 to entice more Filipinos to apply and prepare for their retirement.

Here’s how you can apply:

  1. Create an account though Seedbox Philippines. You can access the website here.
  2. Complete your profile by filling out all necessary information.
  3. Prepare required documents including government-issued ID and TIN.
  4. Answer the Risk Profiler. This is an assessment to determine what kind of investor are you. You will be categorized accordingly – Conservative, Moderate, and Aggressive.
  5. After determining your risk profile, choose the PERA Fund that you want to avail of. Several PERA products will be shown to you based on your risk profile.
  6. Start funding your PERA account. You can do this through various payment channels through BDO, BPI, or Metrobank.

Here comes the best part: you can start for as low as P1,000.

What are you waiting for? Give PERA a chance and start investing for your future. You’ll never know what will happen so it’s best to be prepared.

What is SSS Unemployment Benefit?

Millions of Filipinos, including OFWs, were heavily affected caused by the Covid-19 pandemic. Instead of having a quiet life overseas that allows you to send sufficient amount of money to your family back home, you have no choice but to go back and look for ways on how to earn.

The government, through DOLE, were able to provide P10,000 financial assistance to repatriated OFWs. According to the DOLE website, the agency received more than 617,000 applications and were able to approve 280,253 requests so far (1). Although the government aims to accommodate all applications, there will always be a limitation on budget.

Then, there’s SSS Unemployment Benefits.

What is SSS Unemployment Benefit?

Also known as Unemployment Insurance or Involuntary Separation Benefit, this program is a cash benefit granted to employees who were involuntarily separated from work. Involuntary separation from work includes retrenchment, downsizing, closure or cessation of operations, redundancy, or installation of labor-saving devices among others.

If qualified, the SSS member can get twice the half of average monthly salary credit or ASMC.

Employees who may be covered by this cash benefit are:

  • Employees employed in the Philippines
  • kasambahay or househelp
  • Overseas Filipino Workers, both land-based and sea-based

What are the qualifications:

  • Employee must not be above 60 years old at the time of involuntary separation
  • If the employee is an underground or surface mineworker, s/he must not be above 50 years old
  • If the employee is a racehorse jockey, s/he must not be more than 55 years old
  • Employee paid at least 36 monthly contribution, 12 of which must be within the 18-month period before the month of involuntary separation
  • Employee must not be dismissed due to serious misconduct, commission of a crime, gross and habitual neglect of duties, fraud, and other reasons that will justify the termination of employment
  • Employee did not receive any unemployment benefit for the last three years from the time the termination was severed.

How To Apply For SSS Unemployment Insurance

There are two ways on how you can apply: online application or personal appearance.

Here’s how you can apply online, which is the recommended option to minimize contact:

  1. Log-in to My.SSS account. You can access the website here.
  2. Click E-Services tab.
  3. Choose Apply for Unemployment Benefit Claim.
  4. Fill in the online form. Make sure to provide complete and truthful information.
  5. After carefully reading the certification, click Submit.
  6. Check your email. SSS will send an email requiring you to submit documents such as POLO Certification and Notice of Termination from employer or notarized Affidavit of Termination from Employment, whichever is applicable.

If you prefer personal appearance, then here’s how you can apply at SSS branch near you:

  1. Fill out DOLE Certification. You can get this from POLO where the employer is operating or DOLE Provincial or Field office nearest to you.
  2. Make sure you have the following requirements for submission – Notice of Termination from employer or Affidavit of Termination from Employment, UMID-ATM card, UBP bank card or bank statement showing your name, savings account number, bank branch, and address.
  3. Prepare any valid government-issued ID such as passport, SSS card, Seafarer’s ID and Record Book, UMID card, NBI Clearance, Postal ID, and Driver’s License among others. In case you don’t have any of these IDs mentioned, you can present the original and photocopy of two IDs or documents with picture and signature.
  4. Submit the mentioned documents to the SSS Unemployment Benefits officer-in-charge.

Things To Remember:

Keep in mind that the benefits will be deposited to your SSS UMID card or UMID-ATM card. It can also be deposited in the member’s UBP Quick Card Account. In case you don’t have this, you can apply for an initial UMID-ATM since this is where SSS will credit the unemployment benefits.

In the meantime, you can opt for non-bank cash pick-up or PESONet bank transfer.

Make sure to claim for this benefit within one year from involuntary separation. Otherwise, you will forfeit your claim for unemployment insurance.

How many times can you claim this benefit? Apparently, you can apply once every three years for unemployment insurance. Take advantage of this now since the amount could be helpful to sustain you and your family.

You can check out this brochure for more info about SSS Unemployment Insurance.

References:

(1) https://www.dole.gov.ph/news/ofw-returnees-top-170k-more-to-benefit-from-akap/

PAG-IBIG Offers Housing Loan Restructuring Program For Borrowers

Being an OFW is a sacrifice. You have to leave your family behind for at least two years to be able to give them a better and more secured life. This includes food on the table, bills being paid, education for your kids, and of course, a house you can call your own.

Buying your own house can be heavy on the budget, which is why many OFWs take advantage of PAG-IBIG’s Housing Loan Program. Compared to the housing loans offered by banks and other financial institutions, PAG-IBIG has lower interest rate for easier repayment scheme.

Unfortunately, Covid-19 happened. This prompted hundreds of thousands of Filipinos to go back home while there are still thousands more who cannot go back for variety of reasons. By going home, this means leaving your work that could greatly affect your cash flow. This could be a cause of concern especially if you have pending loans such as housing loan.

If you coursed your Housing Loan with PAG-IBIG, then there’s good news for you. PAG-IBIG is now offering a more affordable monthly amortization and payment relief through the Home Loan Restructuring Program.

Here’s what you need to know about it:

What is the Special Housing Loan Restructuring Program?

This program is offered by PAG-IBIG to all its Housing Loan borrowers who were greatly affected by the pandemic. Through the restructuring program, borrowers can enjoy:

  • Extended loan term
  • Lower monthly interest rate
  • Delayed payment for the principal loan amount, which can be paid towards the end of the loan term
  • Waiver of penalty charges imposed on unpaid monthly amortization
  • Payment relief, which means borrower can opt to start paying the loan anytime between December 2020 and March 2021

Through this program, borrowers will have a lower risk of losing the house.

In case you’re interested of buying a property from any PAG-IBIG Fund acquired asset, you can also apply under the Restructuring Fund.

Features Of Special Housing Loan Restructuring Program

  • Unpaid amortizations will be carried over and made part of the restructured loan
  • Interest rate of 6.375 percent per annum for three years
  • Loan term of up to 30 years, as long as the principal borrower does not reach the age of 70 by the time the loan matures
  • No documentary requirements needed for submission
  • No processing fee
  • No downpayment
  • The program comes with Mortgage/Sales Redemption Insurance and Non-Life Insurance, which serves as a guarantee of payment in case something happens to the principal borrower. Take note that the borrower must pay an equivalent of one year premium within 30 days from the time the loan application is approved.
  • Can be applied to more than one PAG-IBIG Housing Loans

Who can apply?

The Special Housing Loan Restructuring Program is open to all PAG-IBIG Housing Loan borrowers with unpaid monthly amortizations of up to 12 months by August 2020. This means if you were not able to pay the monthly amortization for 13 months and above, then you cannot qualify for this service.

Also, borrowers with cancelled PAG-IBIG Housing Loan or the property was already foreclosed or a subject of litigation cannot apply for this program.

How To Apply

To apply for this program, you can visit the Virtual PAG-IBIG website, which you can also access here. For OFWs, you can access the website here. The online process will be safer, faster, easier, and more secured.

After filling out the necessary information, you will receive a Reference Number, which serves as proof that the agency received your loan application. Keep this since you can use this to check the status of your loan application.

If approved, you will receive a text or email message saying that your loan application is approved. Make sure that your email address and mobile message are active.

What happens if your application is denied?

Don’t worry. PAG-IBIG offers the following programs to help their borrowers settle unpaid amortizations, update their status, and reduce the risk of losing their home:

  • Regular Housing Loan Restructuring Program
  • Non-Performing Asset Resolution Program
  • Plan of Payment

Make sure to avail of this program to enjoy payment relief offered by the agency. As per website, PAG-IBIG will accept applications until December 15 only.

What Happens To Debt After Principal Borrower’s Death?

Death is inevitable. This means no matter what happens, regardless of the cause, we will all die eventually. This is why before that day comes, one must be able to prepare for it to avoid conflict among family members.

One of the most common questions asked is what will happen to debts in case the principal borrower dies. Upon death, does this mean the debt will be inherited by his or her heirs? Are the heirs obligated to pay off the principal’s loan?

Here’s what we know:

Debts Will Stay – Until Paid

According to Article 774 of the Civil Code of the Philippines,

“Succession is a mode of acquisition by virtue of which the property, rights, and obligations to the extent of the value of the inheritance, of a person are transmitted through his death to another or others either by his will or by operation of law.”

Consequently, Article 776 of the same law states that,

“the inheritance includes all the property rights and obligations of a person which are not extinguished by his death.”

What does this mean?

Death does not extinguish any debts or loan obligations. Unfortunately, it will remain until it is paid by the estate. Because of the rules on succession, both assets and liabilities will be passed on accordingly.

What happens to debts?

Don’t worry. When the principal borrower died, individuals or entities like banks and lending companies will NOT go after the heirs. This means the lender cannot harass any member of the family to pay off the loan obligation. The lender cannot also file a case against any family members to pay the debts.

Instead, any outstanding debt will be put against the estate, which includes assets the principal borrower owns and rightfully his up to the time of death. The lender must file a claim against the borrower’s estate that s/he owes them x amount in order to get paid.

According to Philippine laws, debts must be paid first before any assets can be distributed to the heirs. Don’t worry about the family home because the law, particularly the Family Code, Rules of Court, and Commonwealth Act No. 141 protects it against any claims as a result of unpaid debt.

What about debts with a co-maker or guarantor?

First, let’s define a co-maker. According to the BSP, co-maker is a person that promises to pay the principal borrower’s loan in case the latter is unable to do so. The amount depends on what is written in the loan contract.

There are possible scenarios:

  • If the loan contract explicitly states that the principal and co-maker are “jointly and solidarily liable” to the loan, then that means the co-maker is liable for the entire debt and the lender can go after him or her.
  • If there is a specific amount or percentage written in the loan contract, say the co-maker is liable only for 20 percent of the amount, then the co-maker can only be asked to pay up to 20 percent and the rest will be charged to the estate of the principal borrower.
  • If there is no specific provision in the loan contract, then the co-maker is only liable for half of the outstanding debt.

Regardless of the scenarios, the unpaid debts will be assumed by the co-maker, depending on what is written in the contract.

The rules are different for guarantors. Guarantor is defined as a person or organization that guarantees the loan using his or her own financial status. The guarantor’s assets will serve as a collateral and in case of death, s/he will pay off the loan first on behalf of the deceased borrower.

Thereafter, the guarantor can run after the principal borrower’s estate and demand reimbursement. S/he must make a claim as well to be able to collect from the estate.

What can you do as a principal borrower?

Surely, you don’t want to burden anyone with debt. Even if unpaid loans will not be directly charged to your living family members, it could still cause stress and anxiety on them. You don’t want them to go through court proceedings, right?

Here are tips to remember before you apply for a loan:

  • Borrow with a purpose. Don’t just borrow money for the sake of borrowing or buying material things.
  • Set aside monthly payments for the loan. This way, whatever happens, there is a dedicated fund that will pay off the debt.
  • Make timely payments. You won’t be able to incur additional expenses, too.
  • Prioritize loan payment, especially if you have additional funds.

At the end of the day, you don’t want to burden your family. Spend your money wisely and borrow responsibly.

Why It’s Okay To Consider Home Loan Refinancing

One of the main reasons why you wanted to work overseas is to be able to provide a better life, standard of living, and future for your family. This includes buying a house that you can call your own home.

Still, the reality is buying a house includes at least a million and you cannot easily shell out the amount. What you do is to apply for a Home Loan through PAG-IBIG or your preferred bank to help finance the purchase of your home.

Unfortunately, pandemic hit the entire world and your job overseas is affected. You’re also worried that you might lose the house you built for your family. Still, you have no choice but to pay since this is borrowed money after all.

How can you save the house you built? Consider home loan refinancing.

What is home loan refinancing?

Refinancing of home loan is the process of paying an existing mortgage using proceeds of a new loan from a different lender. Compared to the old home loan, the new one has lower interest rate and better terms since the purpose of this facility is to help borrowers become more able to pay off the home loan.

Why should you opt for home loan refinancing?

You can get lower interest rate.

Home loan refinancing is all about timing. Because of the pandemic, the Bangko Sentral ng Pilipinas reduced the interest rate to 2.25 percent, the lowest policy interest rate in the history, by far (1). This is to help reduce the impact brought about by the Covid-19 pandemic by making repayment easier.

What is the effect on your home loan interest rate?

Low policy rate means mortgage rates are low as well, which all lenders must strictly adhere to. Your monthly repayment will be lower, too, because the interest rate is decreased by at least one to two percent. This allows you to have additional savings, which you can use for other equally important obligations.

You want to change your loan repayment term.

Longer loan term is not always recommended because you’ll end up paying more because of the interest. On the other hand, short loan term is not ideal, too, because monthly repayment is higher and heavier on the pocket.

When you refinance your home loan, you can negotiate about how long you plan to pay it off. The good thing about this is that whether you choose short or long loan term, you are still able to save because of the lowered interest rates.

You want lower monthly payments.

Think about this: your current home loan lets you pay P10,000 every month. Because you opted for home loan refinancing, you can enjoy a lower interest rate, thereby reducing your monthly amortization to P8,000.

That P2,000 can be considered as savings or an additional fund to pay off other expenses like monthly utility bills.

You want to consolidate your existing loans.

Let’s say you also have other loans like personal loan or auto loan. Did you know that you can consolidate these together with your home loan into one loan?

Typically, personal loan and credit cards have higher interest rates. When you consolidate it with your home loan, you can enjoy lower rates, which means you will be able to reduce the amount of money that goes into loan payment.

The best part is you only have to worry about one loan. There’s no more excuse for missed or delayed payments just because “you forgot.”

Scout for lenders that offer home loan refinancing. Explore the features since every lender have different offers. Find an offer that you can greatly benefit from. You will be able to save more money, which you can re-allocate for savings, payment of utility bills, or fund for your new online business. More importantly, you won’t lose your home that you built for your family.

References:

(1) https://www.cnn.ph/business/2020/10/1/BSP-policy-rate-decision-October-2020.html

7 Online Business Ideas You Can Try While Waiting For Deployment

It’s not easy to stay in the country, especially when you know that there are bigger and better opportunities overseas. You have mouths to feed and you need to ensure that your family will have a better future; hence you seek greener pastures.

Because of the pandemic, you have no choice but to either go back home or wait for the lifting of travel restrictions so you can apply overseas again. Unfortunately, bills won’t stop coming and your kids need gadgets as they go to their online classes. Your emergency fund is slowly depleting because of the never-ending expenses.

At this point, you decided to venture into online business to earn extra. Even with limited funds, you can still do these business ideas, some perfect for the coming Christmas:

Covid-19 Essential Items

Because of the pandemic, there is a sudden demand for face masks and face shield. Alcohol and other disinfectants are also among the most sought after products. These are now considered as essential items and whatever happens, people will buy these products because they are needed.

Find a supplier with a friendly, reasonable rate and then sell the items online. Your prices must also be within the SRP otherwise, people won’t buy from you. Consider selling items in bundle, say face mask plus face shield, or give free delivery to attract customers. Once you build your customer base, you can start adding other products.

Homecooked Meals

This is among the popular businesses today. Despite the presence of many food sellers, selling homecooked can still be a good business for the simplest reason: who doesn’t eat?

If you have a dish that you can be proud of, then go ahead and offer it. The good thing about this business is that you don’t need to shell out a huge amount of capital. Simply buy the ingredients and containers and you can start selling your famous dishes.

Baked Sweets And Goodies

If cooking is not your thing, then try baking instead. A lot of people can’t say no to a box of chocolate chip cookies or brownies. Everyone needs a bag of pandesal, too.

You can follow the mainstream but if you want to stand out, then try coming up with new food combinations. This will make it easier for you to break into the market.

Make Your Own Beverages

Have you noticed the sudden rise in coffee sellers? You probably saw on Facebook a lot of people selling handcrafted beverages, too. There are even some who focus on cocktails, which can also be a potential for business.

Coffee, milk tea, fruit juices, or even as simple as samalamig, selling drinks can be a good business because who doesn’t need it, right?

Sell Your Preloved Items

For sure, you got tons of items bought when you were still working overseas. You might have unused clothes, shoes, or even items like watch and perfume lying around the house. Why not sell these items and make money out of it.

You can also sell preloved items. Just make sure these items are in very good condition so you can make a good deal out of it.

Become A Reseller

Being a reseller is one of the easiest things you can do if you want to venture into online selling. There are many things you can sell such as food, skincare products, clothes, books, and the list is endless. The good thing about this business is that you don’t have to make a particular product. In case stocks are running out, you simply have to order again from your supplier.

Still, don’t take lightly. Even if it’s not yours, per se, you are responsible for the brand/s you are carrying.

Courier Service

Companies like Grab and Lalamove are on the rise these days because many people are resorting to online shopping. If you have a motorcycle, then maximize it and offer courier services.

Some startup companies prefer in-house delivery service so if you’re up for it, then offer your services. Or advertise this service on your social media accounts. Just make sure to follow health protocols so you won’t get Covid-19.

Earning additional income these days will help a lot in augmenting financial difficulties. Keep in mind that online selling will not be easy. You need to set yourself apart from the other sellers to make your business stand out.

There is no perfect formula but it helps if you will offer unique products, sell items with reasonable prices, immediately respond to customers, and be respectful. Who knows, it might be a stepping stone to something bigger.

POEA Guidelines On Deployment And Repatriation Of Filipino Seafarers

Overseas Filipino Workers are heavily affected because of the pandemic. According to Defense Secretary Delfin Lorenzana, more than 174,000 OFWs were repatriated since the start of the pandemic (1).

However, repatriation is easier for land-based workers since their location can be identified easily. What about seafarers?

Unfortunately, it is more challenging for seafarers to be repatriated by the government. An estimated 300,000 migrant seafarers around the world were unable to disembark and forced to stay in the shipping vessel due to restrictions (2). In the Philippines, about 80,000 Filipino seamen are stranded at sea and have lapsed contracts, although the government is doing the best it can to bring them home (3). Nonetheless, job openings keep on coming and there are still thousands who are considering getting a job at sea.

In line with this, the government, through the POEA, released Governing Board Resolution No. 13, which serves as a guide on the deployment and repatriation of Filipino seafarers.

Here’s what you need to know:

When the seafarer cannot be deployed due to Covid-19 –

Let’s say you already have a signed Employment Contract and all your documentation requirements are complete. You are also scheduled to leave on a certain date – until Covid-19 happened.

Due to travel restrictions that resulted to flight cancellations and regulations issued either by the Philippine government or your country destination, you cannot be deployed.

In that case, the seafarer shall be provided food and accommodation at the principal or employer’s cost. This will be until the seafarer is deployed OR the contract was cancelled.

When the seafarer was deployed BUT become stranded during transit –

You were finally allowed to leave the country. On your way to the country destination, you were stranded because of Covid-19 related reasons. You can’t even go home due to flight limitations.

If you were stranded during transit, then you will also have the right to paid basic pay, accommodation, food, and medical benefits at the cost of the principal or employer. This is until the seafarer is able to join the vessel.

If the seafarer’s service was terminated for a just cause but not related to Covid-19 –

If the seafarer is stranded and cannot go back home because of the pandemic, then the employer shall provide food, accommodation, and medical benefits at their cost until the seafarer can go back to the Philippines.

The employer or principal can recover the costs in accordance with the Employment Contract or Collective Bargaining Agreement.

In case of repatriation –

When a seafarer is bound for repatriation due to reasons related to Covid-19, then s/he is entitled to paid basic pay, accommodation, food, and medical benefits at the expense of the principal or employer. This is until the seafarer is repatriated and able to come home in accordance to Philippine protocols on OFW repatriation.

OFWs may avail of the Balik Probinsiya program so you can go back to your province. In the meantime and while in the quarantine facility, seafarers shall be provided food and accommodation at principal or employer’s expenses, unless otherwise provided by the government.

In case the seafarer cannot be repatriated

There are several situations to consider:

  • If the seafarer cannot join the ship and currently in a quarantine facility shouldered by the principal or employer, then paid basic pay as well as benefits such as food and medical must be given until the seafarer either joins the ship or goes back to the Philippines.
  • If the seafarer completed his period of contractual service and his/her replacement is already on board, then s/he must be paid basic pay and afforded food, accommodation, and medical benefits by the employer or principal until s/he gets back home.
  • If the seafarer is still ashore despite the end of employment contract, then same benefits mentioned previously must be given.

Take note that these guidelines are in effect until March 15, 2022. It may be lifted or extended, depending on the situation. Nonetheless, let us all hope and pray for better days ahead.

References:

(1) https://mb.com.ph/2020/09/01/174000-ofws-repatriated-since-april-lorenzana/ .

(2) https://www.latimes.com/world-nation/story/2020-09-08/philippine-fishermen-stranded-at-sea-by-the-pandemic-we-think-about-jumping-overboard

(3) https://www.marineinsight.com/shipping-news/coronavirus-80000-filipino-seafarers-with-lapsed-contracts-stranded-at-sea/