6 insights towards financial wellness
It is normal to spend one's hard-earned
money, but financial experts would advise investing a portion for the future.
Nuri Barrios, Unit Manager of Sun Life and a
licensed Mutual Fund Representative shares the following insights on achieving
financial wellness:
1. Investment is the key to passive income.
Investment is money at work. It is the secret of the rich.
2. Know that saving is different from
investing. Saving is for short-term
needs (e.g. bills, immediate expenses, emergency fund); but money meant to stay
intact for years should be invested.
3. A good investment is something that earns better
than the inflation rate.
4. It doesn’t matter how much you earn, “Invest a
little each time, all the time,” is a wise advice from Bam Aquino, Sun Life’s
investment advocate.
5. Read. A good book to start with is “Rich Dad, Poor
Dad” by Robert Kiyosaki. Learn about different investment vehicles, like Mutual
Funds. Sun Life Asset Management Company considers mutual funds as “investments
made easy.”
6. Once your heart is open to investing, partner
with a credible and stable financial institution (like Sun Life Asset
Management Company or SLAMCI ) to achieve your investment goals. Investing is a
long-term endeavor. Make sure, your
partner will be able to see you through.
Invest on
a mutual fund for only P5,000
The notion that only the wealthy can invest
in a mutual fund or other non-conservative wealth- creating or wealth-protecting
tools is a myth. Nowadays, one can invest for as low as P5,000.
“In a mutual fund, you can start small with P5,000
and you will have the same return as that of the large investor,” said Valerie
Pama, president of SLAMCI. “When looking for an investment, think of these
three things – safety, liquidity and yield. You can get these three in mutual
funds,” she added.
In a mutual fund, money from different investors
are pooled by a company, invested in different securities and issued to the
public as shares. An investor looks at the net asset value per share (NAVS). If
NAVS goes up, an investor can create profit if he sells his mutual fund shares.
But if the NAVS decreases, the investor losses if he sells it.
Historically, if money was invested in Equity Fund
(a choice of fund among Sun Life’s Prosperity Funds), 10 or 11 years ago, the Average
Compounded Return would have been over 15% per year. Balanced Fund placements
around the same time would have garnered an average of over 12% per year.
Funds
with P5,000 Minimum Investment
Sun Life Asset Management Company has several funds
pooled under what is called the Sun Life Prosperity Funds.
With P5,000, one can start an investment account
and this amount is already diversified among different financial vehicles.
Whether you are conservative or risk-taker, there are funds suited for your
appetite. Although mutual funds are ideally for the long-term, investors can
opt to redeem their fund shares any time at the current value if there is an
emergency.
1. Money Market Fund - ideal if you are
conservative and would like your money to stay for a short period of time yet
earn from it. This fund invests on special savings accounts.
2. Government Securities Fund - ideal for
conservative investors. This fund invests mainly on government debt.
3. Bond Fund - for moderately conservative
investors, this fund invests on government and high-quality corporate debt thus
ensuring that your money is stable but still earns.
4. Balanced Fund - if you are somewhat conservative
and risky yet you want to earn and can afford to lose some of your investments
for higher return. This fund invests on high-quality debt and equity securities.
As of June 2015, this is the largest in the market, with assets under
management (AUM) of over P16 billion.
5. Philippine Equity Fund - if you want high return
but willing to take a 'high risk', this fund is for you as it invests mainly on
high-quality equity securities.
6. Philippine Stock Index Fund - if you can
tolerate high risk and if you want your money invested in broad diversified
securities with the Philippine Stock Exchange Index.
Bigger investors can also look into the Dynamic
Fund, Dollar Abundance Fund and Dollar Advantage Fund. Read more here: Sun Life Prosperity Funds
In SLAMCI, each mutual fund has its board of
directors who are experts in the industry. The team does the research, creates
strategies, decide where to invest and evaluates to make sure that investors’
money goes to the right places. Additionally, SLAMCI is part of Sun Life
Financial, a global company based in Canada that has been operating for 150
years. Sun Life Financial Philippines is 120 years old.
“A lot of people think that they need a large sum
of money to invest. So, we tell people to do a sleep test. Take it in small
measures until you get the feel of it,” Pama concluded./
***
For more information, you may contact Nuri Barrios through
0917.302.7692.