OFW guide: Secure your future by saving money

Overseas Filipino workers send billions of dollars in personal remittances to their families in the Philippines every year. The World Bank estimated that the money sent to the country by OFWs in 2012 would reach $24 billion, making the Philippines the world’s third-largest recipient of remittances. The World Bank's figure is $2.5 billion higher than that of the country's central bank. The Bangko Sentral ng Pilipinas (BSP) estimated that OFW remittances for 2012 would reach $21.5 billion. As OFW remittances account for about 10 percent of the Philippine economy, the BSP has an OFW advocacy program, which recognizes" the valuable contribution of the Overseas Filipino Workers (OFW) remittances to the economy." Through the program, the BSP seeks to improve remittance flows and address any remittance-related issues. The bank said it "created an interactive portal that will link users to information on the different banks and non-bank remittance companies in the Philippines, including locations of their branches abroad, remittance center, foreign bank/correspondents, products and services, and charges/fees for remittance services to any part of the Philippines." The BSP also introduced the Philippine Payments and Settlements System(PhilPaSS),  providing OFWs a cheaper way to send money through formal banking channels. According to the book “Central Banking for every Juan and Maria,” PhilPaSS helps OFWs save money because it standardized back-end processing fees to P50 from an earlier range of P150 to Php 550 per transaction. The book said PhilPaSS is equipped with "an efficient feedback mechanism that will allow OFW remitters to trace the status of their remittances." Money-saving tips Meanwhile, the information site OFWGuide.com listed eight tips to help OFWs save money: (1) Put your mindset to "saving mode" To be successful in saving, an OFW has to have a "firm decision" to save. Once you've made the decision to save, stick to it. The site suggested harnessing the power of positive thinking in pursuing your goal to save money. With this mindset, people can overcome obstacles to saving money such as impulsive buying or careless spending. (2) Live within your means Want a luxury car, a gold bracelet, or a Rolex? The question is: Could you afford it with your salary? If it's an "easy no," then that's a sure sign that you shouldn't even think about pruchasing those things. Spend only on things that would be within your budget and maintain that routine. However, you may treat yourself every now and then whenever you accomplish feats in work or your personal life which are worth celebrating. (3) Save then invest When you put your money in the bank, you may not immediately see your money growing but it is a good start. A savings account is the ideal way to begin your journey. It will put you in a spot where you are expected to save money. There are other options like investing in the foreign exchange market but these things can wait. Focus first on ensuring that you are actually saving little by little. (4) Create an expenditure list Jut down your daily spendings in a small notebook. List down the food, groceries, and other items where you put your money into. Doing this also allows you to monitor where you are overspending. This will remind you not to overspend next time. (5) Set a financial goal Create a financial goal that you can realistically accomplish in the given period that you are earning. Are you aiming for a car? A house? Or just a certain sum of cash to take back home? Having a solid goal inspires you to do better in terms of saving. (6) Let your family know your financial goal Having someone to back you up with your goals is great. It will be much easier for you to reach your goal of saving money if your family is backing you up every step of the way. This will give you encouragement and a much needed morale boost for your saving journey. (7) Drop vices Vices are addictive. If you are addicted to something that costs a couple of bucks, this will add up and eventually bruise your wallet. If you have vices, it would be best to drop them. Just save your money instead of spending it on vices.  If you have no vices, keep it that way and avoid any invitation or temptation to try vices. (8) Beware of credit cards Credit cards are like a double-edged sword. They may make shopping a lot easier but if you are not prudent, using a credit card may lead you to overspending. Small interests pile up and eat away at your savings. Thus, if you could use cash, use it instead. However, if you've already incurred a credit card bill, make sure to pay it immediately before the interest gets higher. - Andrei Medina, VVP, GMA News