Picking the right financial products and services can feel overwhelming, especially with so many available options. Moreover, it’s not always easy to apply and get approved for them.
Whether you want to start a business, get a credit card for the first time, or apply for a personal loan, it pays to get the right financial products. During Moneymax’s recent #ElevateYourFinances panel discussion, industry experts answered questions and shared tips on choosing the right products to achieve your financial goals.
The panel included Rahul Rasal, Group Head of Retail Products at Security Bank; Jessica Faye Tan, Head of Marketing at Moneymax; Jared Uichico, Vice President - Head of Partnership Distribution at Manulife Philippines; Simon Javier Calasanz, Country Manager at Mastercard Philippines; and Raymund Villanueva, Head of Brand and Growth Marketing at GoTyme Bank. The event was hosted by Mikki Sachiko.
If you missed the Facebook live event, that’s okay. Check out the highlights and key takeaways from the event, so you can get the best financial products and elevate your finances!
How to Choose Financial Products for Saving More Money?
For Rahul Rasal, choosing a financial product to save more money depends on your specific needs. Your needs should match the financial product.
“For example, if you’re applying for a credit card, are you going to use it for lifestyle purposes, or are you going to use it for credit? If it’s the latter, there’s a risk that you’ll exceed your means,” he said.
Simon Calasanz shared the same sentiment about knowing your needs before getting a particular financial product. “Do your research. Customers are now spoilt for choice. You can use comparison tools like Moneymax to compare products easily and find the right one for you.”
Jessica Faye Tan recommends looking for banks that offer higher interest rates. “The word ‘interest’ has a negative connotation, but it can help people who are looking for higher interest rates in their savings accounts. It's definitely one of the things to look out for if you want to grow your money with very little risk.”
In addition, Jessica highlighted the importance of protecting one’s wealth through insurance and emergency funds, especially during these times of uncertainty and economic decline.
Raymund Villanueva also believes in putting your money in high-interest savings accounts. But more than looking at high interest rates, you should know how to budget correctly. “Track every expense. By seeing what you’re spending on, you can improve your personal budgeting,” he advised.
For Jared Uichico, there’s no one size that fits all. You have to consider your financial capacity, financial situation, time horizon, and risk tolerance. Do your research and speak with trusted and licensed experts, financial advisors, bank relationship managers, or even financial services resources online like Moneymax.
“The beauty of now is that there are so many different channels and ways to access this information and financial products,” he said.
What are the Financial Products and Services to Consider for Increasing Your Income?
Inflation is real, and we’re all starting to feel its impact on our finances. With this, more and more Filipinos are looking for ways to earn more, such as businesses or side hustles. Which type of financial products and services should you get if you want to boost your income?
For newbies or young professionals, Rahul stressed the need to build a good relationship with a bank before starting a business or side hustle.
“Banks are favorable to their clients and may offer them a personal loan. A personal loan is advantageous because you get three to five years to repay. It also doesn’t require any collateral, which you may not have when you're just starting out,” he explained.
Jared agreed that it’s important to build a relationship with an advisor or bank to make sure you have the right financial resources and professional support system. Furthermore, you need to mitigate some of the risks so that if something happens to you, you have the income to continue your business.
“Take care of yourself. And once you've started your business, take care of your people,” he said.
In addition, look at products that can help you operate your business at the least cost possible. Maximize your earnings and savings by using a corporate card. This way, you can manage your finances with as few transaction fees as possible.
“What you save from these products can help you put more funds back into your business,” Jessica shared.
Which Financial Products Should You Consider for a Car Purchase?
An auto loan is the best financial product for a car purchase. “Auto loan interest rates are lower than personal loans because they are secured loans,” Simon explained.
Raymund, on the other hand, reminds car buyers not to get the first deal they see. “Shop around first because you might find something more favorable to your finances,” he said.
“If you plan ahead and save up for a car, you can even pay for it in cash. You can save a lot and enjoy more discounts,” Jessica added.
Why Compare Financial Products, and What to Compare Aside from Prices?
For Rahul, comparing is essential because many financial products talk about or accentuate what's best about them. “If I want to spend and save at the same time, I should look at what it can give me back every time I spend. I can look at something like a cashback credit card. If I spend ₱100 on one card and the same amount on another, how much do I actually end up spending?”
“Aside from prices, look at the features and benefits that fit you,” Jared added. “As in life insurance, embedded or optional riders may make a product seem more expensive. In some cases, you don’t need those additional riders, especially when you’re just looking to save. It’s really about knowing what your goal is and then making a point to shop around.”
Jessica also pointed out the hidden benefits banks or financial institutions don’t really promote, such as pet insurance. However, they’re a fairly new product in the Philippines and offer limited coverage only. Jessica advised researching which insurance companies can provide the coverage you need for your pet’s hospital bills.
When it comes to banking products, Jessica also shared that cashback credit cards offer different multipliers based on your purchase. If you like to eat out, look for a card with multipliers on restaurant transactions compared to grocery or supermarket transactions. “Some cards also have partnerships with car brands that can provide discounts on casa repairs or fuel,” Jessica added.
What are the Benefits and Features to Look Out for When Considering Financial Products?
“Aside from comparing prices, interest rates, fees, and terms and conditions, your bank or financial institution should also have a contact center or online helpdesk,” Simon said.
“Do they have a mobile app where you can monitor your balance and transactions? Do they have SMS alerts that you can set up so that you're reminded regularly? These things enhance the value proposition of the product you're taking up with them.”
“You also need to look at the transparency aspect,” Jared stated. “For more complex products that involve investments or paying premiums regularly, transparency is very important. That way, you'll see what your account value is and how much it's worth now if there's an investment component. You can track your payments and find out when your account is due.”
For Raymund, it’s the timeliness of a financial institution’s customer service. “If you have a problem, are you going to be able to talk to someone to quickly help you with your problem?”
What to Avoid When Choosing Financial Products
Not all financial products are created equal. Be smart when buying financial products and avoid these dangers or pitfalls.
Not Fully Understanding How Financial Products Work and How They Work for You
According to Jessica, one of the pitfalls of getting financial products—and one of the reasons most Filipinos believe financial products, like loans and credit cards, are bad—is that they don't fully understand what these products can offer. Hence, they’re unable to use them to the fullest.
“A lot of people want to get life insurance but don't understand what it's for, why they should be insured, what the coverage is, why it takes so long to mature, or what happens after maturity. Does the insured get their money back? These are the most common questions that are often not answered in a straightforward manner by insurance agents.”
Because clients don't know what questions to ask, they don't know which specific VUL (variable universal life insurance) product is better for them. So they go with the default product. “But if you take the time to do your research, then you can unlock more features that are more suited to your own needs and your lifestyle,” Jessica explained.
Higher Interest Rates = Higher Risks
Raymund also reminds Filipinos to look at who’s backing a financial institution. “There are lots of new financial products coming in which are also unsecure. For Filipinos looking for a quick buck, just remember that with high interest rates come much higher risks,” he said.
Answering Other Questions About Financial Products
What if I applied for a financial product and got rejected? What else can I do?
Raymund suggested trying other financial institutions that offer a similar product. “Look and shop around because there will be other financial institutions that can offer what you need. Start building a relationship with financial institutions so you'll be less risky,'” he said.
Jessica added that you can find out how different financial transactions affect your credit score or credit history. “For example, when your credit card or loan application gets rejected, one of the things that you should not do is apply again right after. You need to wait for a certain time. It differs per bank, but wait for around six months before deciding to apply again.”
“When you’re applying for the first time, seek advice on the product you’re applying for and how you’re going to apply,” Rahul said. “But most importantly, be transparent about your transactions. Technology has made it easier for us to get money. It has even made it easier for banks and authorities to monitor your performance across various relationships. Be transparent when you divulge information because not doing so is often the principal reason for being rejected.”
Simon advised evaluating your situation because it might not be the right time to apply for a particular product. “If it is, ask the bank because there might be some rejection reasons you can remedy. Maybe you just didn't provide complete information, or there was a missing field you forgot to fill out, or you failed to submit complete documents. When you do, it might change the decision. If it doesn’t, there are many other financial institutions that you can check.”
How much of my salary is considered for a car or a home loan approval?
According to Simon, the entire salary is taken into consideration when financial institutions make their assessment of whether or not you can repay. “How much of the salary they’ll look at in terms of payment of amortization will depend on the kind of product. For bigger loans, it can be 30% to 40% of your salary,” he elaborated.
What’s your take on financial gurus advising against using credit cards to better manage our personal finances?
For Jared, who believes credit cards are beneficial to personal finance management, the key is to pay your credit card bill in full and on time. “Then you can really reap the benefits and rewards. It's all about spending within your means, taking advantage and knowing the benefits, and getting a card that fits your lifestyle.”
Simon agreed that credit cards are advantageous, especially cashback credit cards that let you save money on different spending categories. “As long as you pay your bills on time, credit cards actually help you save, and you're able to build your wealth through even a credit card product.”
For Raymund, it’s about having a financial account to spend for a specific item or category. He shared that his mom has a credit card that she uses for travel and another one for international spending. He also does this now.
“It's a lot easier now to manage your finances. With digital banking and all these digital apps on the rise, what used to be a very chaotic system of having five or six accounts that you have to pay out, is now just a click on your mobile phone,” he said.
There was more great advice imparted by the panel in closing. For Jessica, it’s crucial to unlearn all the preconceived notions and myths about financial products. If you do it right, credit cards, loans, and insurance can benefit you in the long run.
Raymund also reminded everyone that most financial products and tools are free to use. Now’s the best time to explore all these tools and products and not limit yourself to just one financial product.
Learn more about choosing the right financial products for your goals, boosting your financial awareness, and elevating your finances. Browse through the Moneymax blog today!
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