Every Little Bit
START TAKING FINANCIAL RESPONSIBILITY WITH THESE EASY STRATEGIES
1 Save up for an emergency fund Take note that this is not for buying a gadget you’ve been eyeing for a long time or for planning a holiday — it is to tide you over a temporary loss of income. The figure should be at least three to six times your monthly expenses. Maintain a separate account for this kind of saving.
2 Start protecting your assets It is extremely important to get a good protection plan before you start on further investments or savings. Your options range from a good hospitalization plan to a whole life insurance plan. It doesn’t matter how healthy you are — it’s your personal responsibility to begin this as soon as you start earning an income. It will help prevent any possible medical expenses that would eat into your savings.
3 Write down your financial goals and objectives Most people save for the sake of saving, and do not know the exact reason why they save.
It helps to write down your short- and long-term financial goals, such as buying a house, getting married, preparing for your children’s college education and your retirement. These figures will tell you how much and how long you have to save to reach them.
4 Budget and calculate your monthly surplus Maintain a disciplined spending pattern and always set a tight budget for your expenses, especially the variable ones. To calculate your monthly surplus, subtract your monthly expenses from your monthly wages. Most people spend before they save, when the best method is to actually save before you spend. This reduces your chances of overspending.
5 Allocate your resources After figuring how much you are able to save each month, assign that amount to your financial goals. Do not neglect your short-term goals because of your long-term goals, and vice versa. Knowing the exact time frame for a particular goal will enable you to find the most appropriate investment tool.
6 Find the right savings instrument Consider the time frame and your “risk appetite”. It may not be advisable to look at an investment for short-term goals; and if you have a low risk appetite, you might want to consider fixed deposits or endowment plans. A financial adviser can assist you in choosing the instrument best for you.
GET SET FOR LIFE
Here’s why life insurance is a wise investment
“Life insurance creates long-term savings and attractive investment opportunities, plus you have money for old age and estate transfer needs,” says Amy Tamayo, vice president of marketing at Insular Life. For those working overseas, life insurance can yield additional benefits. For instance, Insular Life also allows their policyholders to have assured funds for the education of their children or long-term health care.
For more details, log on to www.insularlife.com.ph
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