Investments in the Philippines You Can Start with Just P1,000

by Moneymax, on category "Personal Finance"

July 25, 2019


Investments for Beginners in the Philippines Under P1,000 | Moneymax

What would you do if you win PHP 1 million right here, right now? You’d probably start splurging your winnings by buying gadgets, clothes, and other unearthly luxuries. Ask this question to others. You’d probably hear a few people respond with “investments.” And the truth is that you should follow their lead if you want to keep your million peso cake and eat it, too.

But what if you only have PHP 1,000 under your name right now? Can you still invest it and make your money grow? The answer is a big YES, there are investments for beginners out there. Believe it or not, there many possible investments in the Philippines. It’s up to money-savvy Filipinos like you to find these investments and take advantage of them.

Mutual Funds

Investments for Beginners in the Philippines Under P1,000 - Mutual Funds

A mutual fund pools your money with multiple investors into a bigger fund, which will then be invested in bonds, stocks, or money market funds. The funds are managed by a specialized mutual fund company where your shares are managed by a fun manager. The Securities and Exchange Commission (SEC) regulates mutual funds companies in the Philippines.

Ideal for: Low to high-risk investors with long-term financial goals

Advantages of Mutual Funds:

  • Mutual funds are among the best investments for beginners, especially if you have no time and expertise to monitor your fund’s performance.
  • The higher your investment and the longer you invest, the higher profit you’ll get.
  • A professional fund manager from the mutual fund company of your choice will grow your money and make investment decisions for you.
  • You can start investing for as low as PHP 1,000. SunLife, ATRAM, and PhilAm offer some of the most affordable mutual fund investments in the Philippines.

Risk: Investments may go up or down, so returns are not guaranteed. At some point, you could lose some funds on your investment.

Unit Investment Trust Fund (UITF)

Investments for Beginners in the Philippines Under P1,000 - UITF

You can also invest your PHP 1,000 on a Unit Investment Trust Fund. A UITF is an open-ended pooled investment fund handled by a fund manager. It’s quite similar to a mutual fund, the only difference is that UITFs are offered by banks and are thus regulated by the Bangko Sentral ng Pilipinas (BSP).

Ideal for: Low to high-risk investors with long-term financial goals

Advantages of UITF:

  • Your money will be managed by a professional, so you won’t have to monitor the market daily.
  • You’ll invest in high-yielding assets that are traditionally available only to institutional investors.
  • It’s easy to buy and withdraw units—just request for a withdrawal, and the bank will credit your money to your settlement account.
  • You can invest for as low as PHP 1,000. UITF investments in BDO are made easy with their popular BDO Easy Investment Plans.

Risk: Just like mutual funds, returns for UITF are also not guaranteed. Prepare to lose some funds from your investment.

Stocks

Investments for Beginners in the Philippines Under P1,000 - Stocks

If you want something more complicated, you can try venturing on stocks. Joining the stock market in the Philippines means buying stocks of a publicly listed corporation and becoming one of its part-owners or shareholders. You’ll earn when the company performs well and alternatively, you’ll lose if they perform poorly.

Ideal for: High-risk investors with long-term financial goals

Advantages of Stocks:

  • Investing in stocks yields high earnings when you buy stocks of a company at a low market price and then sell it later at a higher price.
  • You’ll have easy access to funds, which can be cashed in or out through your broker during trading hours.
  • You’ll need only at least PHP 1,000 to open a stock trading account. COL Financial offers one of the most affordable stock market investments for beginners with their COL Starter Program.

Risk: It’s a high-risk investment because stock market prices tend to rise and fall rapidly. If the market price goes down, you’ll lose funds. You can limit risk by putting your money in different stocks and allocating only a portion of your income to stock investing.

Pag-IBIG/SSS Investment Program

Investments for Beginners in the Philippines Under P1,000 - SSS Pag-IBIG Fund

But if you’re looking for investments for beginners, try something that’s less intimidating. How about investing in government-regulated programs like the Pag-IBIG MP2 Savings Program and the SSS PESO Fund? They work like saving accounts from banks, only with higher interest rates. You can start investing for as low as PHP 500.

Ideal for: first-time investors with low income, employees or self-employed

Advantages of Pag-IBIG/SSS Investment Program:

  • The initial investment for the Pag-IBIG Fund starts at PHP 500, while the SSS Investment Fund starts at PHP 1,000. Both are very affordable for an investment vehicle.
  • Since it’s regulated by the government, there’s a slim chance of losing your savings.
  • Registration is a breeze as long as you’re already a Pag-IBIG or SSS member. Monthly payments are not required and they won’t penalize you for late payments.
  • If your worried about investments scams, then these government funds are perfect for you since they are already well-vetted.

Risk: Your dividends will depend on the financial performance of Pag-IBIG and SSS as a whole, so expect some inconsistent earnings.

GCash Invest Money

Investments for Beginners in the Philippines Under P1,000 - GCash Invest Money

But what if you only have less than PHP 500? Can you still start your journey to the world of investments? The fact that you’re seeing this here means the answer is still yes. GCash Invest Money allows anyone with a smartphone to start their own investment, all thanks to GCash’s partnership with ATRAM Trust Corp.

Ideal for: first-time investors with low income, college students, anyone with a smartphone

Advantages of GCash Invest Money:

  • You can have an investment for as low as PHP 50, the lowest initial investment out there.
  • No need to worry about submitting documents or maintaining a balance. Just register and invest.
  • You can add to your investment easily with just a few clicks.
  • Since it uses the GCash app, you can manage all of your investments online.

Risk: Technically, the risks are low to none since it’s a relatively new investment vehicle and you’re investing low amounts of money. It’s the perfect way to introduce investments for beginners.

Final Thoughts

Thanks to these inexpensive investments for beginners, your PHP 1,000 can easily grow to any amount you want. If you’re feeling lucky, you can even combine these investment vehicles to form a diversified portfolio and minimize risks.

Don’t be discouraged by your low capital. What matters more is that you’re already taking the first step towards financial freedom. Do it as soon as you can—right after you read this article even—so you can make the most out of your investments.

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