Where should I in­vest my sav­ings?

FHM (Philippines) - - PULSE3 -

money. When you bor­row money against fu­ture salaries, and the money bor­rowed is spent on con­sump­tion, there is a high risk that you will bor­row again in order to re­pay your loan be­cause you will most likely use your salaries some­where else ei­ther for per­sonal or fam­ily needs. Many OFWS are poorly ad­vised on how to use bor­row­ings wisely.”

An­other mis­take, Ong adds, is pri­or­i­tiz­ing ex­penses first be­fore sav­ings. “One would nor­mally look at what to spend first and leav­ing what­ever is left to sav­ings,” he says.

Ong, who writes a per­sonal fi­nance col­umn for En­trepreneur Philip­pines, says the habit of sav­ing de­pends largely on the lifestyle of the per­son. While some peo­ple may find it hard to save, oth­ers may find it easy.

“The first thing to do is change your mind­set,” he says. “Un­der­stand and em­brace the rea­son why you need to save. Come up with a sav­ings plan, per­haps, start with 20 per­cent and in­crease it slowly un­til your dis­ci­plined spend­ing has ad­justed to your new lifestyle in order to achieve a higher sav­ings per­cent­age.”

Paras seems to be do­ing it right. He says he has al­ready bought prop­erty in Min­nesota and par­tic­i­pates in the US govern­ment’s 401K, a re­tire­ment pro­gram. He says his com­pany also matches a cer­tain per­cent­age of his con­tri­bu­tion.

“Out­side of that, I have a monthly sav­ings goal,” Paras ex­plains. “I take that out of my ac­count and place it in a higher yield sav­ings ac­count even be­fore I start pay­ing off bills. I also in­vest in the com­pany I work for through an ESPP (Em­ployee Stock Pur­chase Plan) pro­gram. I dab­ble in cryp­tocur­rency (Bit­coin, Ethereum) but very ca­su­ally. I don’t put money in it that I’d be scared to lose at the casino—be­cause it’s re­ally a form of gam­bling at this point. We’re start­ing to talk to a few in­vest­ment man­agers to put our sav­ings to work, but noth­ing con­crete on that yet. I have prop­erty in the Philip­pines, but don’t re­ally in­vest in any­thing else there.”

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