Investing in Philippines: How can an OFW return home and not work abroad anymore


Thursday, December 29, 2011

How can an OFW return home and not work abroad anymore


The Philippines is one of the countries who rely on overseas worker remittances to fuel its economy. I am an OFW myself and it is true that working abroad gives one a better chance at having a better life due to the bigger pay. In addition, with that, most people look at an OFW as rich but in reality, the foreign exchange rate makes the difference.

Comparing one's salary in the Philippines against the one overseas may look like that the overseas pay is bigger than your pay here. However, most do not factor in cost of living overseas. Also, the lifestyle one has overseas affects one's saving power. An OFW might have bigger pay and thus has a better capacity to save but when one's lifestyle overseas is that of a spender there is no difference from an employee here in the Philippines worst yet when that OFW who spends while working abroad overspends he or she might go home penniless. A lot of OFW go home without even having their own home and end up bum in their sibling's house because they are accustomed to that lifestyle that they have overseas.


On my way to the NAIA Terminal 1, the taxi driver is an OFW waiting for his Visa for Australia. We are able to share stories about the hardship of being an OFW and all his regrets why he didn't save while he is able. He has two kids to send to school so while waiting he drives taxi for a living. He now has a plan and that is to save up once he gets the work in Australia and start with one taxi. Probably by the time he gets enough money, he can send it to his wife who will buy and start their taxi business, thus two sources of income that is his employment and his one taxi operation at home.


The week before I was claiming my money that was in a closed bank in Pangasinan. Unfortunately, I was not able to get it on time and the bank directed me to go to the main PDIC and request a re-issue. While waiting for the certification the bank manager ask me if I knew of the OWWA loan. She said that I could loan a certain amount and have my wife start a business here in the Philippines. I am still in the process of planning my marriage with my beloved who works here in the Philippines. And with that we have decided to save up for our dream businesses and we will be able to get married soon and I will be able to go back here in the Philippines and either start business, get employed, or practice as a CPA.

OFW's can actually make a big difference in the Philippine economy if only they can wisely use their money. The problem of being an OFW is that a lot of family members will have expectation if one is an OFW. A good example is that when a mother or a father becomes an OFW they send money, toys, and other things to their children to compensate their absence. If the husband is the OFW the wife request money for house remodeling, money to buy her personal beauty stuff, and others. This are normal and OK but most of the time instead of saving and using money wisely family members begin to want a higher lifestyle like your daughter wanting the latest phone so that she would be in her schools elite group, your son wanting a 42" flat screen TV and the latest gaming hardware to play games every day and so many more.

But what if just l like the taxi driver I met would save up and established a business? Probably a small sari-sari store, a small rice retailing shop, a unit of taxi, a small food kiosk in the corner of the barangay where tricycle line up, or even yet an investment in the stock market, UITF, or real estate. As Bob Procter's teaching money should not be kept under one's bed... it should be circulated in a way that gives a return. Yes at first of course it’s hard to see your hard earned money be put into an investment and you can’t even enjoy it but the time you get returns from such investment it will be a very sweet reward or even you would rather re-invest such returns to grow your money and eventually go back home permanently and spend more time with your family.

So how can an OFW like me and the taxi driver start so that we won’t be working away from our love ones?

The answer to this question is to ALLOCATE, SAVE, and INVEST.

It is a fact that we need to eat to live. So an OFW should first establish an allocation for his or her salary. At first, this would be very hard but as you get use to it, you can manage to live with it and be able to go to the next step. As always, one has to list down what he or she is spending on right now. List all the things you are currently paying off like loans, debt, mortgage etc. Then also list down you daily living expenses like food, housing/rent in your overseas work, and the money you send back to the Philippines for your love one's daily living expenses as well. From there you should categories whether such expenses or cash outlay is a need or a want (yup the classic categorization). Try to scrap the wants little by little. This way you won’t be traumatized from the sudden absence of such need.

Whatever is left you can now allocate your earnings to it. At first, you will end up short but as time goes, you will be able to discern what are really are important and from there you can start contribute to your savings.

Make it a point that from now on you will contribute to your savings fund. This is the very first priority. This savings fund is different from the savings fund (click here)I put money in since that one is an allocation for something I want but would rather save up first before buying it. The savings fund here I am talking about is a catch basin for whatever is left after you have allocated some funds for your needs.  I know some of our local banks have branches all over the world and you can deposit your money in there. Your goal is to increase your savings fund so that you can eventually invest it.

After saving a considerable amount, you can now start looking into possible investment vehicle where you can grow this savings fund while you are working. Always ask; that is the key to success. Ask those who have actually gone from nothing to richness. These people have found the answer to how to make money work for them instead of them working for money. From time to time, engage these people to a simple chat and learn from their experience. Also, you can always search the Internet how to start business or how to open some accounts for investments back in the Philippines. A reminder as well that you should do your due diligence to protect your savings from fraud or frauds.

I guess with these knowledge an OFW like me will soon  be able to go back home and spend more time with love ones and make money work for them. Lets dream and lets achieve our dreams.


junorchids said...

I agree to your formula: Allocate, Save and Invest. For the sake of simplification, OFWs can follow this, Income minus Savings equals Expenses. this is to make sure to have a monthly savings. Then invest what you save. If you want a long term investment, the Phil Stock Market is your best option. Your investments will grow over time through the principle of compounding interest! To make sure that your money grows to its maximum growth potential, know the right stocks to buy and when to sell them. For those who are new to Stock Market investments, I may suggest that you find a stock mentor to guide you. With the trend of the market today, one can say that It more fun investing in the Philippines!

junorchids is a truly rich club member by Bo. Sanches.

Investing in Philippines said...

Thank you Junorchids for your input. Lets share to our kababayan this idea so that we can prevent OFWs from returning to overseas work but instead stay in our country and contribute to its growth by being an investor and entrepreneur.