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Monday, March 13, 2017

5 Money Tips for OFWs + 5 Guidelines on Borrowing Money


As a Filipino that works abroad or OFW, how long would you like to work in other country and be away from your family? Do you have a goal to be able to come back in the Philippines for good, let us say, after 10 years of working?  Others may say, this is impossible because of too many spending to meet, especially with a family back home without a stable income.  But according to wealth expert Vice Rapisura, president of the Social Enterprise Development Partnership, Inc. it is possible for an OFW to set a goal to come back home.

As a Filipino that works abroad or OFW, how long would you like to work in other country and be away from your family? Do you have a goal to be able to come back in the Philippines for good, let us say, after 10 years of working?

Others may say, this is impossible because of too many spending to meet, especially with a family back home without a stable income.

But according to wealth expert Vice Rapisura, president of the Social Enterprise Development Partnership, Inc. it is possible for an OFW to set a goal to come back home.


He said the poor financial literacy, lack of a financial plan is often the cause why OFWs come home empty-handed despite the higher salary they get while working in other countries.

Sad to say, some OFWs are even poorer than before they left, he said.



Here are some tips from Vince:

1. Set a goal
OFW should make a goal to be able to come back within 10 years of working abroad.

He said it is possible with this process: 
  • The first two years or the beginning state -This time, OFW should pay his debt first he incurred to be able to work abroad example the placement fee, plane tickets, etc. 
  • The two-three years or the medium term - Here, OFW should focus on the basic needs of his or her family. 
  • The three-five years of the long term -OFW should spend for their financial goals like being able to buy a house, open a business and many others.
2. Know where you are

Take the test to describe your financial practices. The rating scale will help you determine whether or not they are good practices.
You may take the test here.
3. Budget your money

OFW should follow the 5-15-20-60 budgeting rule
  • 5% of the income going to insurance premium 
  • 15% - savings 
  • 20% - investments 
  • 60% - expenses

(Watch: Budgeting Rule)

4. Clear your debts (The "utang" guidelines)
OFWs are not exempted to debts, in fact, there are many OFWs that sent into prison because of debts while working abroad. It is said that borrowing money is common among many Filipinos also with OFWs.

Vice suggest following this cardinal rules as guidelines on borrowing money

  • Borrow money only when you plan to use it for productive purposes. This means using the money to finance something that creates income.
  • Income from this project should be greater than the interest you will pay.
  • Installment amount should not exceed 20% of your regular income.
  • Do not borrow to finance wants. To be able to buy the things you want, save for it or create an investment portfolio that will provide you with a passive income.
  • Lastly, borrow only from formal financial sources. This way, you can take advantage of lower interest rates and establish your credit history.

(How to get out of bad debt)

5. Invest

It is not true that investing requires a huge amount of money. This thing hinders many from investing.

According to Vince, you can start investing with small amounts by simply opening a savings account. As you get more money using your active income (salary, commission, etc), you gain the propensity to invest in other investment vehicles.

Just make sure you are investing in the right place. Study or do a research first before putting your money into an investment so that you won't be a victim of investment scams which OFWs are more prone.

MORE RELATED ARTICLES:

Read More: 7 Practical Tips for OFWs to Earn Extra Income

There are other ways to add income to a family by engaging in a small business.1. Online Selling - Online shopping is a trend nowadays. Fashion apparel, gadgets, processed foods remain the highest selling online item. It can be run 24/7 at home with low operating expenses. For the capital, you can borrow it from your OFW family member.2. The Carinderia or Food Business - Any business that deals with food are surely profitable for as long as there is proper management of the business. The food business will always be a popular business idea for Filipino OFWs.

Read more: http://www.jbsolis.com/2017/03/tips-for-ofws-to-earn-extra-income.html#ixzz4bFZWWyg7



READ ALSO: 9 tips to become debt-free!

Do you have piled up bills needed to be paid? Or are you able to manage your loans timely? Do you still consider yourself as a debt-free person? Well, one of the things that stresses us out or somehow gives us headaches is debt. Student loans, house loans, electrical bills are just some examples of debt that gradually consume your money in no time!In order to avoid that, discipline in spending money and prioritizing your needs are the keys. Hence, in a segment of Good Morning Kuya of UNTV, Ms. Riza Matibag-Muyot, a financial teacher, shared about tips on how we can be debt-free.


Read Also: 7 Habits That Will Help You Save More And Live Providently

The thing we always say no matter how much income our household gets every month, "not enough". But why is that? There are some families who's monthly salary is less than what you are receiving and yet they manage to save and stay out of debt more than we do, or while they seem to have enough ours never seem to meet our needs. Here are some tips to save and be self-reliant.

1. Buy more of the fresh produce, a little at a time on the local farmer's market- We can always get fresher vegetables and fruits if we buy in the local market instead of supermarket, plus we can also haggle. Don't buy too much for what you need. Fresh produce are perishable and you don't want it to go to waste.

Read more: http://www.jbsolis.com/2015/04/7-habbits-that-will-help-you-save-more.html#ixzz4bFcYv9Ie






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