Now that you have a family to support and provide for, you should start reviewing your finances and shopping for investment options to achieve financial security early on. This can be a challenging subject to discuss with your spouse or other members of the family, but it’s worth a shot for your future’s sake.
Whether you’re just starting your family or posing as the breadwinner among your siblings, you carry a great weight of financial responsibilities. However, it’s really crucial to plan for you and your family’s financial security.
Helps you avoid financial instability
The earlier you start to invest, the better your family’s financial situation will be covered down the road. Over time and with your growing money, you will be able to purchase things you need, want, or otherwise can’t afford had you not decided to invest. You can even use your investment earnings to save yourself from debt.
Helps prepare for your children’s future
Investing as early as now means your money will earn substantial returns over time. This is going to help you have more money to allocate for your children’s college fund or education plan without derailing your other expenses.
Secures your future and your family
Putting your money to work in investment vehicles is like setting the direction for a secure future. Investing is more than being rich; it’s all about having a safety net for your family in case emergencies or tragedies happen. By establishing a nest egg, you know you’ll have a large sum to live off when you get laid off work, resign, or retire.
Allows you to take risks
Regardless of the type of investment you choose, you’ll always have to deal with risks. By investing early, you’ll have enough time to recover if you happen to invest in high-risk ventures or under volatile conditions. On the contrary, investing later can leave you with limited investment options since you’re more cautious and trying to avoid potential losses.
Improves your spending habits
You get to hit two birds with one stone through early investing, as it helps you save, as well. Instead of spending your money on unnecessary expenses, you’re more inclined to stick to your budget so that you’ll have enough to put toward your investments.
Where to invest
On top of your fixed bills and expenses, other costs can add to the mix. So, how do you build your wealth and prepare for the future? Invest your money where it can multiply, such as the following:
Unit Investment Trust Funds (UITFs) allow you to buy and own units of a company. UITFs are investment products managed and offered by banks. Since companies offering UITFs need to register with a government agency or entity like the Securities and Exchange Commission or the country’s central bank, you know your UITF investments are safe and legit.
Mutual Funds (MF) are similar to UITFs; the main difference is that mutual fund companies manage MFs. Professional fund managers handle the funds, so you don’t have to stress over making investment decisions.
Investing in stocks means you’re buying units of ownership in a corporation, which sells some of its shares to raise money for the business. By owning or investing in a company’s stock, you become one of its owners. You can earn a return on your stock investment either by selling it for a profit or by getting a share of the company’s revenue if the stock you bought pays dividends to shareholders.
Cryptocurrencies are essentially digital coins that people can use to trade. It’s a highly volatile market, but it offers enormous growth potential. You can purchase crypto coins on cryptocurrency exchanges.
Sure, you can look into financing options if your business idea would cost a lot, but small businesses don’t require significant capital. You can even use your performance bonus or incentive pay from work to kickstart an online shop for homemade goodies or other retail products.
There are different types of insurance you can invest in, with life insurance being one of your best options. Life insurance itself is divided into two main categories: Term life insurance and Permanent life insurance.
The first type is also called Term Life insurance, which gives you guaranteed death benefits as long as the policy is in effect at the time of the policyholder’s death. This type doesn’t come with cash benefits, unlike permanent life insurance. When you invest in this type, the money that you’re paying for your policy goes toward a death benefit and cash savings. This allows you to reap the benefits of being insured.
Summing it up
Rather than leave your money sitting in a bank account, which has the potential to lose its value due to inflation, you can put it to work and earn high returns through investments.
Investing has risks, but that’s why it’s standard advice that you diversify your portfolio—for security and more significant gains. There’s no better time to organize your finances and work towards a secure future than now. Start early to multiply your money!
BPI-Philam Life Assurance Corporation is a strategic alliance between two leading financial companies in the Philippines – The Philippine American Life and General Insurance Company (Philam Life) and Bank of the Philippine Islands (BPI).