6 Tips to Help You Save for Retirement

They say being an OFW is not forever. That’s true. This is why it is important to strike while the iron is hot and save as much as you can not just for emergency purposes but also for your retirement.

“How can I do that?” you might ask. Where to start and how much you should set aside is also a big question.

Don’t worry. This post will tell you everything you need to know and do to help you save for your retirement.

1) Two words: Start early. 

This is the first step in establishing your retirement fund. There is no hard-and-fast rule but to start early and start as soon as you can. The earlier you start, the more you can save.

2) It’s more than just having a savings account. 

You might think that the only way to establish a retirement fund is by setting aside a certain amount every month and depositing it in a savings account. Apparently, that is not enough.

Keep in mind that building a retirement fund is more than just making regular, monthly deposits. Your money won’t grow big, especially if you target millions by the time you retire at 35, which is why you need to invest in other financial products too. Don’t limit yourself with savings account and explore other options such as stocks, mutual fund, or bonds since they yield higher returns.

Read more about your investment options here. 

3) Set aside an amount and then COMMIT. 

At this point, you established the many ways on how you can grow your money. You also decided on the investment option to try to boost your retirement fund. The next thing you need to do is to establish how much money you will set aside for your fund and making sure you stick to it.

For instance, if you are 30 years old and you want to save one million for your retirement fund, then you should set aside P3,000 every month for 30 years to attain this.

It’s not going to be easy since it requires discipline and commitment. It will be challenging at first, but once you start getting used to it, saving for your retirement fund will be a breeze. Remember, consistency and commitment go a long way.

4) Live simply and within your means. 

Don’t be too complacent just because you are earning in dollars. You will never know what will happen and you need to set aside a portion of your income for retirement, so it is best to always live a simple life and within your means. Pay for the basic necessities and do not spend you money on things that you will not need later on.

Before you buy something, ask yourself if you really need it and how long you plan to use it. Think twice before you buy.

5) Take it easy on loans. 

There are instances when you will need to apply for a loan, especially when you are short of cash. That’s understandable. Before you submit your loan application, evaluate and ask yourself if you really need one. The money you will use to pay for the monthly amortization is better off with your retirement fund. Plus, you don’t want to be buried in debt, do you?

6) Pay off existing debts, if any. 

Do you want to know another secret to having a bigger retirement fund? Try your best to be debt-free. You will never be able to contribute a big amount in your retirement fund if a portion of your salary is also paying off debts.

Therefore, pay any existing debts, whether personal loan, housing loan, or even credit card debts. At the same time, avoid incurring further debts. If you can’t afford a new car yet or a vacation with the family, then delay them for now. It will be easier for you to grow your money if you are debt-free.

With these tips in mind, are you ready to put up your retirement fund?

What You Need to Know About PERA (and Why You Should Have One!)

When it comes to retirement fund, you would often think of a savings account or your contributions in SSS. You may also rely on your insurance or investment plans, although it may take some time before you get the proceeds. In that case, you might want to consider opening PERA.

You might ask, what is PERA and how does it differ from other retirement funds? Read on to find out.

What is PERA? 

PERA stands for Personal Equity and Retirement Account.

Sometime in 2008, Republic Act 9505 or PERA Act of 2008 was passed to promote savings mobilization and capital market development in the Philippines. It is also a voluntary retirement savings plan, which you can have in addition to your SSS or GSIS. More importantly, this will benefit, you and other OFWs who are unable to contribute to SSS or GSIS but still need to establish a retirement fund.

You can open to up to five (5) PERA accounts, but it must be under one administrator.

Who and How to Open PERA

Anyone with Tax Identification Number or TIN and stable income can open PERA. Even OFWs who are still abroad can open savings or investment account with through your legal spouse or child.

Requirements include:

  • Overseas Employment Certificate issued by POEA
  • Any official document reflecting your income
  • If your spouse will open an account in your behalf, submit a Marriage Certificate, Sworn Certificate attesting spouse to transact on your behalf, and supporting documents showing your OFW status.
  • If your child will open an account in your behalf, submit Birth Certificate, Sworn Certificate attesting your child will open an account in your behalf, and supporting documents proving your OFW status.

The Cost of Investment

Every year, you are allowed to put up to P200,000 every year. For non-OFWs, a maximum of P100,000 is allowed. Nonetheless, make sure to ask the bank where you plan to open an account regarding the minimum amount in opening an account.

The purpose of this facility is for long-term use. To maximize the benefits of this account, it is best to withdraw your money by the time you reach 55 years old and meeting the required number of contributions (it’s five).

Why OFWs Should Have PERA

You might be wondering: why apply for PERA when you already have a sufficient savings account? Here are reasons why you should have one:

  • Tax credit, wherein your contributions are entitled to five percent (5%) every year
  • Your money grows tax-free since the account is exempt from income tax, withholding tax, capital gains tax, and 10 percent cash received from corporations.
  • Any withdrawals made by the time you turned 55 and onwards cannot be taxed as long as you made consecutive contributions for at least five years.
  • PERA is not part of your assets, which means it cannot be taken by creditors or dissolved in case you declare bankruptcy.
  • The employer can contribute on the fund as long as the amount is within the annual limit.

Don’t get too excited. Despite the benefits, applying for this type of facility is intended for your retirement plan. This means you cannot withdraw early, otherwise, you will pay a penalty fee. On the other hand, in case you withdraw due to cover the expenses of an accident, illness-related hospitalization of at least 30 days, or total permanent disability, no penalty fee will be charged.

At present, only BPI and BDO were accredited by the Bangko Sentral ng Pilipinas as PERA Institutional Administrator.

The Different Aspects of Financial Planning for OFW

Many OFWs agree on one thing: they work abroad for money. Money could help provide a better and more secured future for the family, which is why you are willing to make that sacrifice.

Here’s the thing: working overseas and sending money back home are just the first two steps in achieving financial freedom. In fact, many OFW families are either financially broke or have no sufficient savings or investment – and surely, you don’t want to be one of them.

The key here is proper financial planning. Here’s what you need to know about and how to start with financial planning: Financial Planning for OFW

Monthly Income

Admit it. Earning in dollars gives you a sense of pride and fulfillment, knowing that you can provide better for your family. Still, don’t let the dollar sign in your payslip forget the reason why you are working overseas and spend more than your usual.

Keep in mind that the cost of living in other countries is higher compared to the Philippines. Before you splurge, make sure you get to know the place where you are assigned. Check the prices of essential goods, cost of rent (if house is not provided), food, and transportation. If time permits, consider getting a second job for added income.


Now that you identified how much you will be spending, it’s time to set a budget. It may not seem a lot, but budget can be a lifesaver. It teaches you the value of discipline since you set aside portion of your earnings for equally important things. At the same time, it helps you keep track of your spending and allows you to adjust certain areas in order to save more.

Start by listing all your expenses everyday, no matter how big or small your purchases are. Make this a part of your daily routine until you are able to create a realistic budget.

When it comes to budget, make sure you won’t miss this next part.


Sending money back home is mandatory. In fact, this will always be part of your budget. Still, here is something you need to remember: don’t send all of your earnings.

Many OFWs send more than half of their salary and leave little for themselves. This may be a selfless act, but you’ll end up with nothing when the real emergency comes in. Include remittance in your budget, but make sure you consider other expenses too. You may be earning in dollars, but it is not your sole responsibility to provide for the family – and the rest of your relatives.


Since you set aside money for remittances, make sure you leave something for savings as well.

To make it easier for you to save, think of a goal you want to achieve by the end of your contract. It could be a new car or a small business for your family to help augment the expenses. Use that as a motivation to encourage you to save more.

Here’s a tip: open a savings account, preferably with online banking facility. If you can, don’t inform your family about this, so you won’t be tempted to withdraw anytime. Transfer portion of your earnings and do your best not to use the funds. Consider this as your emergency fund so you have something to use in case of rainy days.


Don’t limit yourself with savings. If you want to attain financial freedom, you need to be wise with your investments too.

Many OFWs are scared to invest, saying that they don’t understand what investments are or how the stock market works. The good news is there are many information available in the Internet, which gives you a crash course about the different investment options. Read about them during downtime and familiarize yourself to know more about what’s best for you.

Since you are into investing, remember about your goals on why you want to work overseas. Similar to savings, this is also a good motivation to encourage you to work harder and fastrack financial freedom.

Money and Saving Tips for the New OFWs

Every year, thousands of Filipinos are deployed in various areas around the world to work for better opportunities. Every year, thousands of new faces with variety of skill level join the OFW workforce.

If you are one of them, don’t be too excited. Working overseas allows you to earn in dollars, but this doesn’t mean you should spend money in whatever way you want it and just to keep your family happy. If you are one of the new OFWs deployed, then this one is for you. Below are money and saving tips you need to remember to get the best out of your employment without compromising your financial future:

1) Don’t send everything and set aside for savings. 

Most, if not all OFWs will agree on this: the main reason why they work abroad is to provide a better life and future for the family. OFWs earn in dollars, thereby allowing you to earn more than what you can get back home.

Still, don’t use the “I’m earning in dollars” excuse to send everything to your family and leave almost nothing to savings. Being an OFW, although is a privilege, is still full of uncertainty. Anytime, war or crisis may happen that could cut your “trip” and send you back home. You don’t want to go home with almost nothing in your pocket, so make sure you set aside a portion of your salary for savings.

This leads you to the next tip.

2) Open a bank account specifically for savings. 

According to the latest Consumer Finance Survey of the Bangko Sentral ng Pilipinas, 1.6 out of 24 million households have less than P5,000 in their deposit account. Worse, not many households maintain a deposit account since they don’t have enough money to open one.

Don’t be one of them.

Even before you leave, make sure you already opened a deposit account, preferably with online transfer facility, exclusively for savings. You can remit directly from that account, which could come in handy in case of emergency.

Check out this post to know more about banks that offer Savings Account for OFWs.

3) Take it easy on shopping. 

There will always be a temptation to buy new clothes or gadgets and send it back to the Philippines. That’s okay. The problem lies when you always give in to temptation.

The best way to address this is to plan your shopping. Wait for sale, consider buying in thrift stores, and only spend within your budget. After all, your son won’t need new basketball shoes every month.

4) Share a room with fellow OFWs. 

You’re abroad and living the life, and that’s good. Still, this doesn’t mean you should live on your own as well. Unless your employer provided housing arrangement, consider sharing a space with fellow Filipinos. Renting your own place can be costly. When you share a place with a few people, you will be able to defray the expenses since you share the costs with few more heads and save more for the rainy days.

5) Don’t follow the crowd. 

You saw your housemate bought a new iPad for his daughter while your other housemate has a balikbayan box full of clothes and shoes for his family. It is tempting to do the same and you surely want to give that to your family.

The problem is you can’t afford it and that’s okay. Don’t keep up with the crowd just to save face. It’s okay if you can’t splurge on your family now. There’s nothing embarrassing about it. Instead, use that as a motivation to work harder.

6) Set your goals and stick to it. 

There is a reason why you went abroad. Aside from providing a better future for your family, you also want to achieve certain goals in life and working overseas can be a stepping stone towards that. Life as an OFW is not easy, so make sure you set your goals, set your eyes into it, and work hard in order to achieve it.

Common Obstacles that Stop OFWs from Being Millionaires

Every year, POEA will release the latest OFW statistics that show how many Filipinos with different skill levels were deployed and where. The number varies every year, but this will remain constant: hundreds of thousands of Filipinos are seeking greener pastures abroad to provide a good life for their family. After all, with the OFW earning in dollars, a good and stable life is within reach.

Here’s the biggest question: how come there are many OFW families are still not living the comfortable life?

Perhaps, these obstacles are the reasons why:

1) Lack of Goal Setting and Financial Planning

It is not the OFW’s sole responsibility to provide a better life for the family. In order to succeed, the family must work together in setting goals and planning about the future. This means OFW families must sit down, agree on what they want to achieve in 5, 10, and 15 years time, set guidelines and plans on how to achieve it, and make sure to stick to it.

It doesn’t matter how long you work overseas. Most of the time, working as OFW for 20 years won’t guarantee you a fat wallet. As long as you and your family agreed on what to do financially especially when you are abroad, then you might achieve financial freedom earlier.

2) Family Dependency Plus Lavish Lifestyle

Here’s a common scenario among OFW families: once someone starts working abroad, everyone else depends on him. The standard of living also changes, which explains why your monthly salary is often used up.

If you want to be a millionaire, then you and your family should maintain a simple lifestyle. Learn how to say no to extended family’s requests and take it easy in buying pasalubong. Sticking to your financial goals and making sacrifices will help you a lot in reaching your first million.

3) Financial Illiteracy 

What kind of financial products do you have aside from savings account? Most Filipinos are not aware of the various financial products available, making the Philippines among the least financially literate – and OFW families are not an exception.

If you want to grow your money, don’t settle with having a savings account. Having one is a good start in establishing financial freedom, but take time to explore and try other investment options. You can start with Time Deposit or mutual funds. Bonds and investing in the stock market are also good options and yield higher return. If you are willing to risk it, buying a property or putting up your business can help you achieve financial freedom.

Know more about your investment options here.

4) Limited Information and Lack of Financial Education 

There are many reasons why Filipinos are financially illiterate. Perhaps one of the biggest factors is the lack of education. Investment options or budgeting tools are not often taught in school and most of the time, you will have to find about it on your own.

Make use of the Internet, know the different options aside from savings account, and determine which tool is most effective to grow your money. Don’t be afraid to ask questions too, since it is part of your learning process.

Don’t let these situations get into your head and stop you from reaching your first million. It will take time and a lot of effort, but fighting these circumstances make all sacrifices worth it.

What You Need to Know about Emergency Fund (And Tips on How to Set It Up)

They say being an OFW is not forever. That’s true. There will come a time when you need to go back home and look for another opportunity to work abroad and sustain your family and their needs. There are also instances when you need to go back home due to existing conflict in the country where you’re working or you will be sent back home due to unforeseen circumstances.

This is why it is important to have an emergency fund – to help you start from something due to events that you didn’t see coming.

Read on to find out everything you need to know about emergency fund, plus tips on how to set it up.

What is an Emergency Fund?

As the name suggests, an emergency fund is an account specifically for unforeseen, unplanned situations. These situations could be a major illness, loss of job, or a major expense. Experts suggest that regardless of your socio-economic class, everyone needs an emergency fund because you will never know what will happen.

There are various channels that could help you set up your emergency account. You can open a savings or checking account specifically for that purpose, money market account, or even keep money in a safe (although this is not advisable due to proximity and convenience).

Tips on How to Set Up Your Emergency Fund

1) Think ahead. The purpose of an emergency fund is to ensure that you have something to sustain you for the next few months until you are able to get back on your feet. In setting up your emergency fund, make sure to think ahead. Imagine much it would be, the amount you need to allocate every month, and how long your fund will last (preferably at least six months) and work for it.

2) Make it liquid and accessible. Emergency fund is used for emergency purposes. Therefore, it should be liquid and accessible. Savings or checking account is the most feasible option since both are highly liquid and can be withdrawn easily.

3) It should be automatic. In order to make it work, your emergency fund must be filled regularly. Make your contributions automatic and pay for the amount lost in case you forgot to deposit on certain months. If you can enroll your emergency fund account in online banking, then link it with your other accounts to make transfer easier.

4) Maximize loose change. Only few people would love to carry around a bag full of coins. Make use of those loose change by adding them in your emergency fund. You might even be surprised with how much money these coins could add in your account.

5) Evaluate spending choices. Do you really need to open all the lights when you’re sleeping? Do you always order more than what you can consume and finish in restaurants? How many times do you have to take the cab than ride the train or walk? These simple acts seem harmless, but you end up paying more. Take a look at your spending and lifestyle habits, get rid of wasted money, and contribute it in your emergency fund.

More importantly, let your emergency fund be. Let this fund serve its purpose and don’t use the money to cover for your family’s material expenses.

6 Pasalubong Tips and Tricks for OFWs Going Home

“Uy, pasalubong ah!” 

How many times do you have to hear this phrase every time you go home for a vacation or during Christmas season? Surely, a lot of times. Whether or not it’s the season of giving, giving pasalubong to your family (and even relatives and friends), is mandatory and expected. After all, you are earning in dollars.

Does this mean you should use a big chunk of your money buying the latest gadgets and other material things to keep your family happy? The answer is NO.

Here are tips you need to remember when buying pasalubong for your family members:

1) Always set a budget. This is the first step you need to do when buying something for your loved ones back home. Setting a budget allows you to take note of your expenses without hurting your wallet. Just make sure you will stick to it since what’s the purpose of setting a budget if you won’t follow it?

2) Make a list. Apart from making a budget, a list would help you a lot in shopping for gifts for your family back in the Philippines, especially if you belong in a big family. A list helps you keep track of what to buy and its corresponding receiver; thus preventing you from missing out people.

This leads you to the next pasalubong tip.

3) Consider the preference or interest of your recipient. Each person in the family will want something that is different from the others. Instead of guessing and assuming, it is best to ask your family about what they want to receive from you. This way, you are sure that what you gave is appreciated and the money you used to buy it won’t go to waste.

4) Buy something meaningful. It is easy to buy generic things like keychain, refrigerator magnets, or purses for everyone. The question is will they like it? This is why it is important to ask and make a list because you want your family to appreciate what you gave. At the same time, you are sure that they will use it and not just toss it somewhere in the house.

5) Don’t make promises you can’t keepYou know what your kids want and your mother even requested something from you for the first time. While buying something for the family is a good gesture, do not make promises if you can’t buy them. Be honest about your finances and remind your family that you might not be able to buy everything because you are on a budget.

6) Never feel obligated to give. Pressure will always get into your system and feel obligated to buy something for your family and even extended family. Bring yourself back to Tip No. 1 and remind yourself why you are working overseas. It is not your responsibility to fulfill the material needs of everyone in the family just to keep them happy. Set aside something for yourself and for your future instead of focusing on material possessions that will fade, deteriorate, or get damaged overtime.

6 Tips on How to Handle Your Credit Card Wisely

Are you thinking of applying for a loan, whether personal, car loan, or a home loan? Before the bank approves your application, they need to make sure that your credit standing-slash-capacity to pay is exceptional. One of the best ways to prove and boost your credit standing is by applying for a credit card – and making sure that you use it wisely.

Here are top tips and tricks to help you use your credit card the right way: Tip No. 1: Get a credit card that suits your needs. 

Despite the “Mastercard” or “Visa” on your credit card, banks these days offer various credit cards to cater to specific needs. Explore your options and choose a credit card that is best for your needs. In this case, consider BPI Family Credit Card or Security Bank’s Complete Cashback to help you stretch your cashflow.

Tip No. 2: Set a monthly limit – and make sure to stick to it. 

It is tempting to spend, now that you know you have a card to back up your purchases. Apparently, banks look into your spending and if they see that your purchases are greater than your payment, then you might be at risk of getting your loan declined.

Therefore, set a monthly limit and stick to it. This limit should depend on your capacity to pay in full. If you hit your limit, cut any form of spending until the next month.

Tip No. 3: Remember: Your credit card is not an extension of your wallet. 

Keep in mind that the amount swiped on your credit card is equal to the amount you have to pay come billing time. Don’t overspend.

Tip No. 4: Always pay on time and in full.

Have you seen the term “Finance Charges” on your billing statement? That means “interest” in addition to your purchases and you will constantly have it every month unless you pay the amount in full. The worst part is this finance charge keeps adding up, thereby making your total amount due bigger. To avoid that, pay in full and on time.

You might also consider setting an automatic payment for your credit card to avoid the hassle and getting charged for interest or late payment fee. This is why it is important to set a limit so you don’t have to worry about bills eating up your savings.

Tip No. 5: Review your credit card statement all the time. 

Is your credit card providing charging the right purchases? You’ll never know if they do unless you check your statement as soon as you get them.

Therefore, make it a habit to review your credit card statement and make the necessary adjustments when needed. Aside from ensuring the right charges, reviewing your statement allows you to see where your money goes and help you adjust your spending pattern.

Tip No. 6: Keep your credit card secured. 

From the time you get your card, make sure you sign at the back, list your credit card number, and save the hotline number of your credit card company. This will make it faster for you to notify the bank in case your card was lost or stolen.

Consequently, keep your credit card information to yourself. You don’t want people stealing your information and make you pay for their purchases, do you?

Owning a credit card entails responsibility. The challenge now is how responsible are you in using your credit card. The choice is yours.

Money Matters: 7 Money Tips for OFWs When Going Home

One of the most awaited events for every OFW family is when you go home, especially if its been years since you last set foot in the country. Whether it’s a one-week or one-month vacation, going back home means nonstop eating, shopping, and catching up with friends and family. This also means the possibility of depleting your hard-earned money slash savings and going back to where you are working with almost nothing left in your pocket.

In case you are heading home, make sure you read these tips – and keep your finances in check: 1. Set a budget

This is the first rule every OFW must remember when vacationing.

Admit it. There is a tendency to splurge on your family member and give in to friends when you’re back home, especially if it has been years since they last saw you. Nevertheless, never leave without setting your budget. Set aside money and categorize them accordingly – shopping, dining out, quick vacation, and even last-minute or emergency expenses. More importantly, make sure to stick to it. This will help you limit your expenses and at the same time, prevent careless spending.

2. Know needs from wants. 

Now that you are in the process of setting a budget, make sure you differentiate needs from wants.

You might be tempted to buy everything that you can before heading back to the Philippines. Before you make those purchases, stop, think, and decide whether your son really needs that new rubber shoes when you just sent him a new one a month ago. By differentiating needs from wants, you will be able to limit your spending and focus more on the non-material things. You’ll save your wallet, too.

3. Take it easy on pasalubong

Every OFW is guilty on this. After all, giving pasalubong is part of the Filipino culture and at the same time, a love language.

Wait, do you really need to buy one for your friend’s niece or give something to your neighbor? As much as possible, limit pasalubong to immediate family members. You would be able to save a lot if you don’t let the pressure of giving something to everyone get in your head.

This leads you to the next tip.

4. Learn how to say NO. 

Asking for pasalubong or making a list of bilin is common in Filipino society. Most of the time, pressure sets in and it’s hard for you to say “No” when someone asks for this and that.

At this point, learn how to say no. You don’t have to give in to everyone’s demands just because they helped you get a job overseas or your kumpare wants nightly drinking sessions in your honor. You can’t please everybody. If they can’t understand that you are in a tight budget, then it’s not your problem anymore.

5. Remember that you are not a millionaire. 

Working overseas comes with many uncertainties. In an instant, political conflicts, natural calamities, or changes made by your employer could ship you back to the Philippines.

Therefore, don’t live like a one-day millionaire. Never splurge on something that you might regret later on. What you have is a product of your hard work and sacrifices abroad. Spend your money wisely.

6. Set your long-term mindset. 

As harsh as it may sound, you are only as good as your employment contract. Once it’s done and your employer no longer extends your services, you have to face the consequences of going back to the Philippines and look for a new job to sustain the family.

This is why it is important to set your long-term mindset and goals. Instead of focusing on the present and sending money and material things to your family, make sure you are able to prepare for the future. You can’t work abroad forever, so as much as possible, save and invest.

7. Don’t forget your local accounts and investments. 

Do you have local bank accounts? Before heading back to your work overseas, make sure you check your local accounts to see how money is being spent. This is a good opportunity to check any dormant accounts where you get charged with P200 or P300 dormancy fee every month. Checking on your investments, if any, is also a must to keep you updated of how much money you are able to grow.

If you don’t have a local account, then it is best to set up one (or two). Take your time home as an opportunity to study investment options to help you grow your money. This way, you are sure that you have something to lean on in case of emergency.

The time you spend with your family is worth more than the material things you give them. Focus more on things that matter without emptying your wallet. Working overseas is both a blessing and a privilege. Make use of it in the best way that you can without going bankrupt.