Tips from Francisco Colayco on how to save, invest wisely
Francisco Colayco is the Chairman of the Colayco Foundation for Education, and published several books on investment and financial planning. He shared some savings and investment tips last April 25 on “Tonight with Arnold Clavio," a bi-weekly talk show on GMA News TV.
1. Understand risk and don't make bigh purchases you're not sure you can pay.
“Growth, or making money, we can’t fully control. But the risk, we can.” said Mr. Colayco. "Ninety percent of us are focused on the gains, not on what could happen that could make us lose our investment. Having said that, we should be aware that whatever we invest, we can stand to lose. If we can’t afford to lose our investments, [we shouldn't] risk them.”
For people with regular jobs and regular pay, Mr. Colayco recommends that 20 percent of their pay go to savings. “This money can go to emergency funds, for payments of term insurance for accidents or deaths, especially if you have a family. If you have a family, insurance is technical, not an investment. Insurance is protection.”
“There’s one company that has a nice practice that, if your pay is P1000, they only give you P900, and the P100 is forced savings. And it’s yours. They don’t give it to you, and they save it for you. And when you retire or resign, they give it to you. Not all companies are like this, but I wish they all were,” added Mr. Colayco.
“The National Statistics Office says that food expenses can go up to 40 percent of your income,” he added, “but if you can, don’t let rent, transportation and food go above 60 percent of your income. The remaining 40 percent should be set aside for savings, some leisure money, clothes, etc.”