March 1, 2018
To call Overseas Filipino Workers (OFWs) the modern-day heroes or Bagong Bayani is an understatement.
Remittances from OFWs worth billions of dollars drive the Philippine economy. The unsung heroes endure homesickness and difficult working and living conditions just so their family back home can live comfortably and have a better future. Some of them don’t even get to return home alive.
Do you have a loved one working abroad? Be grateful. The least you can do to repay your OFW’s hard work and sacrifices? Stop treating them like an ATM and start making their hard-earned remittances count.
OFWs, together with their families, must work together so that they can return home for good without getting broke. While waiting for that moment, OFWs and their loved ones can take these five steps to make that dream homecoming happen.
When can you afford to settle down in the Philippines? Be clear about your timeline. It can be as short as two years or longer than 10 years, depending on your earnings, expenses, and savings.
Create a definite and realistic exit plan. For example: “I want to return X years from now. By then, all my children have graduated from college, and we have built our new home in Bulacan.” This will make your homecoming feel more like an attainable goal than a far-fetched idea.
Involve your family. Discuss your target homecoming timeline with your spouse, children, and parents. Make them understand your perspective, too. This way, it’s easier to get their commitment to helping you meet your goal.
Nothing wrong with wanting to give your family a bulk of your salary to cover their living expenses. But isn’t it too much of a sacrifice to starve yourself often just so you can send back home a balikbayan box filled with expensive items for everyone in the family?
Don’t think twice about setting limitations on the remittances you’re sending back home. After all, you’re the breadwinner—you have control over your hard-earned money.
Create two sets of budget: one for your family and another for yourself. Ideally, keep at least 30% of your salary as your savings. It isn’t a selfish act—you can’t pour from an empty cup, right? You’re just setting aside some money so that you won’t run out of funds when you decide to return home for good.
You’ve probably heard about stories of OFW families instantly upgrading to an extravagant lifestyle (with little kids toting the latest smartphone and tablet models to boot) but then struggle to pay for hospital bills when a family member gets sick.
While it feels good to splurge on luxuries to make your loved ones happy, think about what matters more: having enough savings for your family’s future. If your family has become overdependent on your remittances as their only source of income, time to revert to a simpler lifestyle.
That huge, pricey smart TV can only do so much in saving your family during an emergency. Neither is it useful 10 years from now.
This is a crucial step in building your life back home. Setting up a business is a better idea for returning OFWs than finding a new job locally. For one, you won’t get the level of income you’ve earned abroad. Running a startup business will make your money work for you even when you’ve stopped working overseas.
Again, get your family involved. Explore several small business ideas to augment your income as an OFW. You can provide funding so that your family can run a sari-sari store, catering business, grocery store, franchise business, or a travel agency.
You can also seek assistance from the Overseas Workers Welfare Administration (OWWA) for building and funding your own enterprise. OFWs can avail of the agency’s livelihood and loan programs for OWWA members who want to return home for good and become self-reliant.
This OWWA livelihood program provides a financial assistance of PHP 20,000 and free entrepreneurship development training to returning OFWs. It may also refer potential marketing networks that can help sustain a business.
OWWA members can apply for Balik Pinas! Balik Hanapbuhay! at the nearest OWWA regional office, through the OWWA website, or via phone call (8917601 up to 24, local 5217, 833-6992, or 09175908654).
You can get an OWWA business loan through one of the agency’s partner banks (Land Bank and DBP). If you’re still working abroad, your legal spouse, parent (aged 60 below), or child (aged 18 above) can file an application on your behalf.
This OWWA loan program offers a low annual interest rate of 7.5% that’s fixed for the entire loan duration. This secured loan can be repaid either for up to one year or seven years.
For single proprietorship, the loan amount ranges from PHP 100,000 to PHP 2 million. If you’re applying as a part of a group (partnership, cooperative, or corporation), you can borrow up to PHP 5 million.
To apply for the loan, submit your business plan to the nearest OWWA regional office. You’ll be required to attend the entrepreneurship development training on what you need to know about starting and sustaining a business.
Saving money is better than saving nothing at all. But over time, the value of your savings will get lower as a result of inflation.
Investing yields higher long-term returns than savings. It also helps you beat inflation. Look for investment opportunities in the Philippines that match your risk appetite and financial goals. As an OFW who earns about thrice as much as a local worker, you’re in a better position to grow your funds faster through investing in real estate, stocks, and other investment channels.
Another viable investment option is the Personal Equity and Retirement Account (PERA), a voluntary retirement account in the Philippines. OFWs stand to benefit the most from PERA because they can invest higher amounts (maximum of PHP 200,000 annually) than non-OFWs (maximum of PHP 100,000 annually). They also enjoy higher tax exemption of up to 5% on their PERA investment.
Investing in PERA is a good way to prepare for your retirement in the Philippines, as the funds are invested in a variety of financial vehicles: bonds, mutual funds, UITFs, and stocks.
As of this writing, only BDO and BPI are accredited by the Bangko Sentral ng Pilipinas to provide and administer PERA investments.
To start a PERA account, an OFW or authorized representative can submit to the bank the following requirements:
Many OFWs are raring to come back home for good to be reunited with their loved ones. But they can’t do it sooner. They still need to work abroad to support their families. Being the sole breadwinners, OFWs provide financial assistance even to their extended family.
If you’re one of them, don’t worry. Start saving, investing, and increasing your family income so that one day, your dream homecoming will finally become a reality.