What Prevents Filipinos from Making Future Preparations

Every Filipino wants access to the greatest healthcare when necessary. Every parent in the Philippines wants the greatest education for their kids. Every working Filipino looks forward to a happy and comfortable retirement. All of them require in-depth planning of finances. While we wish and look forward to those things, the question remains unanswered – Are Filipinos putting forth the appropriate effort?

Here is the reality:

• In a 2020 study, there are 7.6 million Filipinos who are 60 years of age or older, yet only 20% of them are covered by the Social Security System or the Government Service Insurance System, according to the Philippine Statistics Authority.
• In 2020, BSP Gov. Benjamin Diokno said eight out of 10 Filipinos aged 60 and above, who are in many cases already retirees, do not receive a pension to fully cover their living expenses.

Why then have many Filipinos not prepared for the future or are still not prepared if they want the best retirement, medical, and education options for themselves and their families? Why don’t they invest and save for expected and unforeseen events in life?

In this article, we wanted to talk about the harsh reality of why Filipinos are unable to make future preparations for themselves and for their families.

There isn’t enough money left to save

This is consistently the top reason offered by most Filipinos without sufficient savings. However, if we continuously adopt this logic and reasoning, none of us will have any savings. If we follow the formula income minus expenses equals savings, there is likely to be nothing left over because there is no limit to our ability to spend. Instead, we should use the formula, income minus your savings and then whatever is left for personal expenses. No matter how little the amount, we must try to save regularly. Perhaps our discipline is what’s lacking rather than the fund.

The “Bahala Na” mentality of Filipinos

Most Filipinos prefer to take no chances. Filipinos tend to trust fate with their future because of their carefree attitude. The worst-case scenario is that they leave their future in the care of their relatives. Since Filipinos are renowned for having close-knit families, this advantageous characteristic has also turned into a drawback. Some parents impose or demand that their children support them financially when they are elderly and retired. While our kids can assist us, it should only be out of a sense of obligation.

“Can continue to work after retiring”

Many Filipinos do not completely stop working and generating money when they retire. It may simply be a change from working for someone else to working for yourself or beginning your own business. Many retirees believe they may continue to work long after they stop working, especially in today’s market where internet opportunities are plentiful. This prospect of post-employment income somehow minimizes the significance of having the resources to support our lifestyle once we retire.

Now, there is nothing wrong with continuing to work but rather than doing it out of need, you ought to be doing it out of desire. Instead of doing the things you still have to do, you ought to be doing the ones you enjoy. There should be a time in each of our lives when we can simply take a stroll around the park and breathe in the fresh air.

Lacking knowledge of how to execute financial planning

A significant portion of the population either has little to no knowledge of saving and investing or learns about it considerably later in life as adults. Additionally, due to their lack of information, they have little to no access to the various savings and investing options in the Philippines. Filipinos with greater and better incomes are more aware. The more knowledgeable people become and as they have more access to these tools, the higher their income level will be. Because of this, many people believe that only wealthy people can save money and make investments, and that to be successful, one must have a lot of money.

But this is not completely accurate. If only Filipinos knew that they could begin saving and investing with as little as PHP 32 pesos per day which amounts to PHP 1,000 a month, and an additional minimum investment of PHP 500, they can already start building and protecting their wealth for the future. These opportunities shouldn’t be available to only a select few people. Regardless of their socioeconomic status, more Filipinos should have access to them.

Start learning finance today and see the difference it can make in your future!

It is obvious that Filipinos still need to improve their financial literacy. More reasonably priced savings and investing options are made available like United Fund, Inc. and Cocolife Fixed Income Fund, Inc. to encourage more Filipino individuals to start saving even little amounts.

There is never a bad time to learn

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