Now that you’re years away from hitting the big 3-0, you should start taking responsibility for your finances. Unfortunately, most of you didn’t get the memo. A recent study revealed that only 21 percent of Filipino millennials are actively investing their money, 28 percent invest “when they feel like it,” and ten percent don’t even save a single peso. There’s no better time than now to start investing. To help you get started, here are some suggestions for investments young professionals can easily start today.
1. Mutual Funds
There’s a reason why mutual funds recently became a trend among young professionals. A mutual fund involves adding your investment to a unified fund, which will then be invested in stocks, market funds, and bonds. You can start investing at P5,000 and the mutual fund company regulated by the Securities and Exchange Commission will be in charge of growing your money for you. This makes mutual funds the ideal investment for beginners. Just be ready to lose some of your investments due to unpredictable market trends.
2. Unit Investment Trust Fund (UITF)
Similar to a mutual fund, a UITF also pools your investments into a huge fund. The only difference is that banks regulated by the Bangko Sentral ng Pilipinas are the ones in charge of managing your investments. Don’t worry, professional fund managers will still take care of your money and if you wish to withdraw money from your fund, you’ll easily get it in your bank account. Plus, you can even start with an initial investment of P1,000. But just like mutual funds, prepare to take the risk of losing some of your investment.
If you don’t mind spending time learning it, get yourself started with stock investments. Joining the stock market means you’re buying stocks from a corporation, effectively making you one of its shareholders. You’ll earn more when the corporation performs well but alternatively, you’ll lose when they don’t. This makes it a high-risk, high-reward investment since stock market prices are notoriously unpredictable. But don’t get discouraged because you can easily start with a P5,000 investment and a basic knowledge of the stock market.
4. Variable Universal Life Insurance
Hit two birds with one stone when you invest in a variable universal life insurance plan. For as low as P2,000, you can insure yourself and your loved ones while also earning profits every month. What’s great about a VUL insurance is its liquidity, in that you can access your funds after a specified amount of time. This can be helpful in surviving financial setbacks in the near future. Because of this, VULs are popular among millennials who are starting to take charge of their financial lives.
5. Pag-IBIG/SSS Investment
If you’re looking for an affordable investment and you don’t like taking risks, you could try investing your money in government-regulated programs like the SSS PESO Fund and the Pag-IBIG MP2 Savings Program. For just under P500, you can have your own investment fund that doesn’t require you to pay monthly and to pay on time. You can save at your own pace and there’s an even a lower chance of losing all of your investment. Your dividends rely on the financial performance of SSS and Pag-IBIG, so expect inconsistent earnings.
6. Small Business
Gone are the days when having a business requires huge capital. For as low as P1,000, you can invest in your own small business. You can start small with a buy-and-sell business, or maybe spend a couple of bucks to buy a small franchise. You can even bet on your passion like baking pastries, sewing neat pillowcases, or making souvenirs, among others. It doesn’t have to be grand, as long as it generates enough to add to your overall income. It’s a great safety net in case you suddenly enter the unemployment pool; having your own small business would enable you to support yourself while you look for new job opportunities.
7. Invest in Yourself!
No, this is not a joke entry. Think about it: what’s the most important asset that you can invest in right here, right now? It’s yourself, of course! It’s time to improve the existing skills you have and learn new ones to help you grow professionally. Here are some great ways to invest in yourself.
- Perhaps the easiest of all: browse free tutorial videos on YouTube
- If you get an invite to attend seminars and workshops, take it!
- Professional certification programs are also available for you to explore
- Find online courses so you can learn in the comfort of your home
- Consider enrolling in graduate school
There’s no such thing as being overprepared when it comes to planning for the future. Don’t let your age hinder you from starting an investment right now. To increase your chances of high returns, don’t put all your eggs in one basket. Diversify your investments so you can grow your money in multiple ways. Making smart investments, combined with simple steps to control your spending habits, can reap rewards in the future. Once you hit 30 and you start contemplating about settling down, you’d be glad you started investing and caring care of your finances in your early 20s.