When people think of investing, the most common perception is that it requires that you be equipped with an overwhelming knowledge of the stock market and that it could only be made possible if you have taken economics or other finance-related courses.
And so, intimidation comes after, causing people to refrain from venturing into investing. But that should not be the case.
––– Why? –––
Because you can still pursue investing without necessarily having taken investment-related courses. This is especially true for Overseas Filipino Workers and Seaman, who are often associated with manpower-related jobs. Investing does not necessarily require that you have a college degree in which investing is being tackled, for there are also other ways of investing that do not require complex stock market knowledge.
All you need is an adequate amount of money to invest, basic investment knowledge, and, of course, the patience and the perseverance to succeed.
And so, if you are an Overseas Filipino Workers (OFW), or even a newly hired employee looking for ways to eliminate your debt or invest your money, refer to this guide of the top ten best investment opportunities not just for OFWs but for anyone who wants to build and multiply his/her a fortune.
Why Do I Need to Invest at a young age?
Investing is a long-term process. And arguably, what makes a high-yield investment is when you start early.
By starting early, you get to take advantage of the power of compounding, one in which your investment does not simply increase arithmetically, but geometrically.
It multiplies. So not only do you get to have more time to make more money, but also, you get to earn not through a simple interest, but through a compound interest, which gets higher as the years pass.
Top Ten Best Investment Opportunities for OFWs
1. Mutual funds – UITF
Mutual Fund, UITF, and Balanced Fund are the kinds of funds where the investor participates in a trust fund and then earns money depending on the performance of the type of fund s/he invested on.
What is great about this type of investment opportunity is that you get to invest your money in professionals who know how to grow your money.
Ways to earn:
- Through Mutual Fund
- Mutual Funds are regulated by the Security and Exchange Commission (SEC) and are offered by mutual fund companies like Philam Asset Management and Sunlife Financial, and also by some banks that offer mutual funds, such as BPI. This is considered to be one of the simplest types of investment as it does not require much time and effort as compared to stock market. This fund is typically managed by a professional fund manager who is tasked to grow the money you invested. Some companies do allow you to see the performance of your mutual fund online.
- Minimum Investment: ₱10,000.00
- Through Unit Investment Trust Fund (UITF)
- UITF is regulated by the Bangko Sentral ng Pilipinas (BSP), and you can earn money by investing in majority of the leading banks in the Philippines, such as BDO, Metrobank, Landbank, BPI, PNB, UnionBank, and many more.
- Minimum Investment: Though it depends upon the type of investment product, the typical minimum amount is ₱50,000.00, while for others minimum is ₱5,000.00
Guides When Investing:
- Before proceeding to invest in mutual funds like these, it is necessary that you know your goals as a new investor, your investment horizon, and your risk profile. By knowing these, it would be easier for you to decide what type of investment fund you should invest on.
- Given that you already know what type of investor you are, the next thing to learn is to know your debt schemes. If you are more of a conservative investor, then you should stick to largecap schemes, and if you are a moderate investor, then you must stick to multicap schemes.
2. VUL Insurance
- Variable Unit-Linked Insurance is a kind of insurance that also serves as an investment. In this type of investment, what happens is that a portion of your premium is being paid to your insurance charges, but, at the same time, a portion is being invested. What is great about this is that you can choose what kind of investment you would like to invest on: balanced fund (stocks and bonds), bond fund (bonds), or equity fund (stocks). VUL is highly recommendable for breadwinners, young professionals, and OFWs who have no insurance, or are under-insured, meaning, they have no life insurance yet. In a VUL insurance, by investing your money, since you are insured, in case an unexpected death happens to you, your beneficiaries will get insurance proceeds, which they can use to finish their studies.
- Minimum Investment: Some companies, such as Sunlife, offer insurance plans where the annual premium is ₱26,000.00 equivalent to approximately ₱2,100.00 a month.
- Ways to earn:
- Take note that since part of your payment in VUL is being invested, how much you will receive as you retire, or how much your beneficiary receives in case an unexpected death occurs, will increase depending on the performance of the investment fund.
Guides When Investing in VUL:
- You can avail this type of insurance in companies like Sunlife Financial, Pru Life UK, and AXA. But there are also banks that offer this type of insurance. In some Metrobank branches, there are AXA insurance agents, while in BDO, there are also Pru Life UK insurance agents, whom you can inquire on and negotiate with.
- When investing in VUL insurance, be keen on what the insurance agent is saying, Don’t abruptly agree on investing. Make time to search and study the fund’s performance, by looking at Bloomberg or the website of the company.
- In VUL, like in most insurance plans, the younger the person, the lower his/her payment will be. So don’t wait until you get older, for the premium will be more and more expensive.
- By investing in the stock market, you become a shareholder of the company you invested in. And by being a shareholder, you get to own a part of the company. In general, investing in stocks is a long term commitment. And a hands-on approach is definitely needed if you wish to earn a formidable sum of money.
- Minimum Investment: ₱5,000.00
Guides when investing in the Philippine Stock Market
- Know the investment option that would suit the kind of investor you are. There are websites that allow you to assess whether you are a conservative, moderate risk-taker, or risk-taker. But there are also workshops that can help in guiding and giving you a recommended list of stocks.
- Stock is not an easy form of investment. So, you really would have to educate yourself by attending training’s and seminars. But there are also online investment courses you can avail so that you can learn more about investing even at the comforts of your home. Instead, I’m suggesting you invest small sums of money over time using a method called “peso cost averaging.”
Unknown by many, you can also invest through crowdfunding. Here, what happens is that you invest to a start-up business, and depending on the performance of the business, you can get enormous returns.
Ways to earn:
Cropital is a globally recognized organization that enables investors not just to grow money, but also to impact the lives of smallholder farmers.
- farmon.ph – learn more here.
Same as with cropital, farmon functions as an organization that aims to bring future in farming.
Philcrowd is Philippines’ first crowd-sourcing company, and it is especially designed for conservative investors, allowing them to invest for as low a ₱5,000.00 through its Easy Fund, but it also features other funds, such as Baby Fund, Flexi Fund, and Veggie Fund.
Guides when investing in Crowdfunding
- Be keen on choosing a platform. Make time to review the site before proceeding. Look in detail at the information they provide. If you find that it lacks all the necessary information needed, then this should ring bells. Ensure that they have complete information of what they would do to your money, more so, clear and concise information as to why it is a great investment prospect.
- Diversify. Don’t invest all your money in a single place. Find a way to invest in a wide range of areas and business types.
5. Micro-lending and peer-to-peer lending
- Micro-lending and P2P lending are methods of financing that allow people to borrow and lend money without having to go through financial institutions such as banks. But now, these two also serve as a source of fixed income for investors.
- Minimum Investment: ₱1,250.00
- Ways to earn:
You can earn in macro-lending and peer-to-peer lending through different online lending platforms. These lending platforms then bring together the borrowers and the lenders who would like to have their money invested and earn through interest rates. Here are some of the most popular lending platforms you can choose from:
- MoneyMatch PH
Guides when investing in P2P lending:
- Same as with other investment opportunities, always take your time reading about what you would like to invest on.
- Always do some research regarding the online company including its eligibility requirements, possible interest rate risk and liquidity risk, and loan diversification. Also, make time to read reviews regarding its pros and cons.
6. Forex Trading
Forex Trading, as defined by FXCM, is a decentralized global market where all the world’s currencies trade. This is arguably the most liquid market in the world with an average trading volume exceeding $5 trillion.
To make money through forex trading, you must have enough experience. Otherwise, you might lose everything you make. However, the good thing about this is that you have no competition.
More so, the more people work on forex, the more money they make.
- Way to earn:
How you earn through forex trading is also similar to those found in stock market. Forex traders essentially earn by buying and selling currencies. So, you then exchange one currency to another in the expectation that the price will change.
7. Small Business.
- Know what type of investment you would like to invest in. You can invest in small businesses either through equity and debt investments. Now, equity investors earn by buying an ownership stake of the company. So, here they provide capital in exchange for profits or losses. If you are after a small business investment with a higher yield, this is a better option. In contrast, debt investors earn by loaning money in exchange for the promise of interest income and repayment of the principal. What’s great about debt investment is that if the company goes bust, they are given greater priority over the equity investors. Feel free to choose whatever it is that suits your goal taking into consideration the risks.
- As said earlier, do not forget to diversify. Don’t invest in a sole place. Rather, also find other ways to invest for a better risk tolerance.
- As an investment strategy, also consider the taxes and fees associated with trading. If you are not diligent enough, you might lose over 30 percent of how much you have invested.
- Find the right investment advisor. As you look for the optimal one, do not hesitate to ask questions regarding the payment methods, as well as the decision-making processes.
8. Real Estate (foreclosed properties)
This kind of investment requires higher money for you to invest so as to serve as a payment for the land you are going to purchase. But with the right choices, rest assured that you are going to earn more than the worth of money you invested, oftentimes even higher than all the other investment options reiterated here.
Guides when Buying Foreclosed Properties.
- When find foreclosed real estate properties to acquire, you can go to insurance firms, banks, and government institutions, such as SSS, GSIS, Home Development Funds, and National Housing Authority. Take note that you always check the land title for encumbrances (debts, mortgages, and things as such).
- Most foreclosed properties are sold as-is, imperfections and all, and therefore will almost always require repairs. So, you really may have to shell out cash before you make it available in the market for sale. However, while some properties require only minor repairs, there are those that have extensive damages requiring you a lot of time and money to have it repaired. And so, when you buy, check the property well to know if it is a worthy investment. Scrutinize if there are infestations, or if the plumbing and sewage system is damaged, or if there are damages on the walls that require immense repair. The good thing about this is that once repaired, its value will appreciate higher than other properties in the same location.
- When assessing, also consider the location. If it is located in a higher growth area or is still developing into a high growth one, there are higher chances that its value will appreciate. The same is true for those properties near expressways and train stations.
With the rise of bitcoin and other cryptocurrencies, cryptocurrencies are probably the hottest investment opportunity at this age of technology. Essentially, cryptocurrency is a digital currency that serves as a medium of exchange. It is protected by a technology called blockchain, which prevents hackers from hacking the centralized point of vulnerability in digital currencies. Some of the leading cryptocurrencies are bitcoins, litecoins, and ethereum.
- How to earn:
Depending on the demand for digital currency and the available supply of it, the value of cryptocurrency may appreciate. So, you can take advantage of that by buying when the price is low and selling when the price of the cryptocurrency is high.
Guides when investing in cryptocurrency:
- As said earlier, you should buy low and sell high. One good thing about investing in cryptocurrency is that you can purchase it online. And so, regardless of your country or location, in the Middle East or wherever, you can buy the cryptocurrency of your choice.
- If you are in the Philippines, one of the available options is to purchase through websites, such as coins.ph. Moreover, coinbase is also a good website to buy cryptocurrency. However, it is not yet available in the Philippines, but if you are in other countries and it is available in your country, take advantage of it.
- As regards how much is the minimum investment, it depends on how much you would risk losing. Only invest how much you would risk losing entirely.
10. Blogging and Vlogging
- Blogging and vlogging are also great investment opportunities. However, making money from blogging and vlogging requires continuous work and experimentation. In case you are in need of guidance, here are a few points to consider when you are planning to pursue those. What is great about this is that you can integrate your hobbies and passion into your blog/vlog.
- How to earn:
Bloggers/Vloggers earn by monetizing their website through PPC ads (when readers click on the ad) and CPM ads (based on how many people view your ad). The most popular network for this is Google AdSense. They can also earn by including affiliate links and selling digital products. Vloggers, most especially, may likewise earn from making sponsored videos.
Gambling, sweepstakes, and things like that. Several Filipinos love these because they are easier ways to earn money. You just have to allow an ample amount of your money and wait for a miracle to be bestowed upon you. But when will you wait?
And how probable is your chance to win? Seriously, if you are smart about money, you know that there is no shortcut to genuine success, for it requires more than luck.
It requires time, patience, and perseverance.
And by investing, sure, you may have to wait a long time to have a feel of your hard-earned money, but it is still so much better than settling for uncertainty, waiting for something which may not even come at all. And definitely, by investing early, you will have surer yields.
Also, investing can help you earn many times higher than when you let your savings idle at a bank with just [0.15-0.25%] interest rate yield a year.
Investing enables you to earn not just 0.25 percent but from 5-100%. It can even double and triple depending on how committed you are to investing. With the proper investment strategy, patience, perseverance, and will to succeed, then surely are you a step closer to earning more money than your.
Most Filipinos stay away from investing not necessarily because they are not equipped with necessary investment-related knowledge, but simply because they shun long term money-making opportunities.
What they want is easy money that can be earned short term.