Investment Ideas for Retiring OFWs

Overseas Filipino Workers or OFWs are our modern-day heroes. They contribute a lot to the country’s economic growth through the remittances they give their families in the country, which can help them have a financially secure future. In August 2022, their personal remittances reached $3.02 billion, which is 4.4% more than the $2.89 billion they remitted in the same month of 2021.

OFWs don’t solely work hard to contribute to the economy, but also to support the families they left here in the Philippines. They sacrifice their time and face the challenges of living and working alone in another country to help their loved ones have a financially secure future.

However, if you’re one of these modern-day heroes, you probably know the struggle of saving money and building your retirement fund. You may not have enough spare money to save while supporting the family you left in the Philippines. Any money you have left from remittances is used to pay for your needs while living abroad.

One of the challenges of saving money in a bank or mobile wallet is that you can always access it. This means that you can easily withdraw from your savings to fund your expenses.

Instead, you should consider investing your money. Doing so will allow you to avoid withdrawing from your savings and grow your money over time. To help you get started, here are some investment ideas for retiring OFWs and those who want to prepare for their future ahead of time:

#1 Stocks

Participating in stock trading is one of the most beneficial ways of growing your money. It can provide you with long-term investment opportunities, which can give you a bigger return. Stocks are also a more liquid investment compared to other investment ideas for retiring OFWs, meaning that you can easily sell them and get your money once you retire.

OFWs can now participate in Philippine Stock Exchange (PSE) even if they’re currently based in another country. You can work with some stockbrokers to set up an account for a minimum of Php5,000. You can also easily buy and sell stock online.

However, joining the stock market may be intimidating to beginners. To help you get the feel of the market, you should buy stocks from companies that have a long-term horizon. These investments have less risk and volatility and will allow you to invest your money more safely.

Once you understand how the market works, you can begin going for riskier and more volatile investments that will provide you with a bigger return. Over time, you can become a more successful investor.

#2 Mutual Funds and UITFs

Mutual funds and Unit Investment Trust Funds (UITFs) can both be described as pooled investments that earn profit based on the fund’s performance. One of the differences between these two ways to invest for retiring OFWs is that you buy shares with mutual funds and units with UITFs. Mutual funds are also managed by professional fund managers, while UITFs are handled by banks.

The greatest advantage to choosing this kind of investment to build your retirement fund is that you can participate in them for as low as Php1,000. Mutual funds and UITFs also require less time and effort because they are professionally managed. This means that you don’t have to spend your time learning about the market while also feeling at ease that your money is in good hands.

#3 VUL

A variable unit life insurance policy or VUL is a type of life insurance policy that comes with a savings component, which allows you to invest part of your cash value in professionally managed funds. This means that you can get protection while enjoying the opportunity to grow your money.

This kind of investment is ideal for OFWs who are still looking at different types of life insurance policies. It is a great first choice for a life insurance plan because it can provide you with flexible premiums that will allow you to pay depending on your financial capabilities. Some insurance companies also offer life insurance investment plans in Peso and Dollar denominations.

#4 Real Estate

Investing in real estate is one of the fastest and safest methods of growing your money. It is a tangible asset that can become extremely profitable. This is possible because real estate value tends to appreciate over time and is not as volatile as mutual funds or stocks.

When you invest in a real estate property, one of the things you can do with it is rent it out to get regular cash inflow even when you’ve retired. You can then use this income to pay for your necessities during your golden years or invest it again.

You can also choose to sell your real estate property when the appreciation value goes up. Doing so will allow you to earn a profit from your investment, which you can use for other investment opportunities.

#5 Business

Starting a business can be risky and challenging at first. But when you become successful, you can have enough cash flow to support yourself during retirement. The income you get from your business may even exceed how much you’re earning as an OFW.

You can start a business while working as an OFW. All you need to do is work with a family member who’s in the Philippines, such as your spouse, or partner with a trusted friend. You can also franchise a business, which might be more stable for beginners because it has a tried and tested system already in place.

Invest in Your Future

Build your retirement fund by trying the different ways to invest for retiring OFWs listed above. These investment opportunities can provide you with peace of mind once you decide to go home to your family and spend your golden years comfortably.