Setting Up Your Finances: A Guide for the Hardworking OFW

 

If being hardworking was the only requirement for acquiring wealth, then our Overseas Filipino Workers or OFW’s should be swimming in millions of dollars, pounds, or dinars ala Scrooge McDuck.

 

But we all know that there’s more to financial security than sheer hard work; careful planning forms the other part of the equation.

 

So, before you even set foot on that airplane bringing you to Australia, the US, or Canada, be sure to chart out your own financial roadmap in accordance with the following principles:

 

1. Work out short-term and long-term financial goals with your family

 

This is especially important if you already have children who are of school age; their educational expenses ought to be factored into the monthly budget. Short-term financial goals have to do with your contribution towards providing a respectable life for the family, mainly earning and remitting an amount that will help cover the costs of feeding and housing all immediate members. (If you are the sole breadwinner, your monthly contribution should cover all the aforementioned costs.)

 

Don’t forget to make allowances for emergencies as well, especially during the rainy season.

 

Long-term financial goals are all about setting up sustainable income streams in the Philippines that will enable you to stop working abroad and come home. This part of the planning should also include your retirement plans, so look into the rising costs of inflation, your own monthly living expenses, and the ways in which you can invest your money to come up with the amount you need to support yourself with in your twilight years.

 

You wouldn’t want your children to have to make the painful decision of leaving the family behind to help support you in your old age now, would you?

 

2. Maintain a bank account in the Philippines

 

If you don’t have a bank account, now would be the best time to open one. This will kickstart your savings journey, and will also help you transfer funds more seamlessly to your family from anywhere in the world.

   Philippine Bank Setting Up Your Finances: A Guide for the Hardworking OFW  

To make it easier for your family to receive your remittances, you can open a joint account with your spouse or any other member whom you deem responsible enough to have access to the funds. Over time, you can also add nominees to the account for added flexibility (e.g., in case your spouse also ends up working abroad and one of your children need to have access to it).

 

There are plenty of accredited banks in the Philippines, so pick one that best suits your needs. Some banks even have specialized “Kabayan” savings accounts that were tailored especially for the needs of OFW’s and their families, so don’t be afraid to shop around.

 

3. Send regular remittances through the proper channels

 

Have a schedule for remittances in place so that your family will be able to budget properly. You may also want to advise them to keep an eye out for weekends or non-working holidays that could delay their access to the remitted funds.

 

Never send money back home through casual acquaintances or extended family members that you aren’t really familiar with. Should anything go wrong, it would be very difficult to get to the bottom of things or even to get the money back.

 

You should only remit money through legal and recognized channels, either through bank to bank transactions or other accredited financial institutions.

 

iRemit, for instance, is powered by the biggest bank in the Philippines and is both an AUSTRAC Remittance Sector Registry Independent Remittance Dealer and a registrant of the Australian Securities and Investments Commission, so you can rest assured that your money will reach its intended destination.

 

4. Get insurance

 

Many Filipinos are iffy about getting insurance for fear of “tempting fate,” but the truth is, we live in uncertain times. If anything happened to you, God forbid, that would render you temporarily or permanently unable to work and you were uninsured, then your family’s financial future would be in jeopardy.

 

A good health insurance plan could also keep your family safe against being one medical emergency away from getting into debt, provided that you choose the right amount of coverage in anticipation of possible future expenditures.

 

5. Keep yourself informed

 

With the Internet being accessible to just about everyone, you really have no excuse when it comes to reading up on local business or economy news that could open up opportunities for you. You never know when an exciting investment opportunity might present itself and such things don’t last long, so you wouldn’t want to kick yourself for missing it, especially if you’ve got quite a bit of money tucked away.

   Keep yourself informed Setting Up Your Finances: A Guide for the Hardworking OFW  

Being up to date on economic and political news in your host country and in the Philippines can also alert you to major changes that you need to prepare for. Should diplomatic relations between the Philippines and Australia go south again, for example, you may want to start looking for other countries to work in should the powers that be decide to revoke OFW work visas in retaliation.

 

6. Make your money work for you

 

As we mentioned at the beginning, OFW’s have quite the industrious work ethic, and that’s great, but you don’t want to work for money your entire life. The smart thing to do is to double your money by leveraging your substantial income into sound investments that would pay off in the future.

   Make your money work for you Setting Up Your Finances: A Guide for the Hardworking OFW  

Study the different kinds of investment options out there: real estate, stocks, mutual funds, and perhaps even a small business or franchise that your spouse can manage back home. Analyze each one carefully and do your homework before jumping into any of them to minimize any unforeseen risks.

 

Proper, careful planning is often the key to realizing just about any goal out there, and when executed properly, can help you and your family live a life that’s infinitely richer than you initially dreamed of.

Serena Estrella

Serena joined iRemit back in 2016, and has tormented its Marketing Head constantly ever since. To get through the rigors of writing about grave concerns like exchange rates, citizenship requirements, and PH-AU news, she likes to blast Mozart, Vivaldi, ONE OK ROCK, and Shigeru Umebayashi in the background. She does a mean Merida voice in her spare time too.

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