Systematic Saving PH

MAKE SURE YOU KNOW HOW TO PRIORITIZE YOUR FINANCIAL NEEDS

1.) Basic Needs
- you are able to provide your family the basic needs you need FIRST. This includes food,water,clothing,shelter etc.

2.) Emergency Funds
- you have a personal savings that is atleast 3x-6x of what you are earning in a month. For example: your monthly salary is 20,000 you need to atleast have 60,000-120,000 in your bank. This funds will help you whenever sudden needs arise such as hospitalization and unemployment.

3.) Income Protection
- this is more of wealth accumulation and acquiring LIFE INSURANCE products. You have to protect your income and savings. If sudden needs arise,insurance will help you avoid utilizing your own savings/money in bank. Insurance will provide you the amount needed to cover possible hospitalization or worse death.

4.) Investment
- at this level, if all is well you can now start investing to different platforms. Investment will provide you extra and passive income without overthing of the risks. In investment you need to open your mind that you may lose or gain more. You can invest to mutual funds,UITF etc.
Also, you can start acquiring properties at this level because you know you can be able to pay them.

5.) Estate Planning (Legacy)
- this is more applicable to older people. You need to make sure you can transfer smoothly all your physical properties (houses,cars,bank savings) and others like investment proceeds/account values earned through the years to your heirs and family members. A wealth planner can assist you on computing your worth to distinguish the needed estate taxes for proper transfer of ownership to you heirs and family members once you are no longer here.

Now, think of it and tell yourself, "What level am I now?".

If you want someone to help educate you more about this,don't hesitate to message us.

Life is meant to be lived but make sure you live it without any regrets.

LIFE INSURANCE STORY

I always heard about life insurance and it's benefits but It was not really part of my toplist. I have friends who offered me different plans but I always resisted and eventually turned them down. I needed to save my extra money for my dream vacation in Spain.

One insurance plan really got me and it has a critical illness coverage so you can claim once you get diagnose of the listed illnesses. My grandmother died of breast cancer at the age of 75 and I thought "I wont be getting the same sickness since I'm too young and free!" I have to save money to travel the world,buy my favorite gadgets and drive my own porsche - these are all my dreams in life.

"I want to get my own life insurance but I will do it later perhaps before I reach the age of 40. And I know I am heathy because I don't eat junks, only the healthy ones like vegetables and fish. I sleep early and not really into bad vices. So yeah I wont die anytime soon! The company I worked with also provided medical insurance so basically I already have a decent coverage once I suddenly get hospitalized.", I told myself.

That's what I always think back then...

In 2007,I suddenly fainted and I was rushed to the hospital to get treatment. When I was in the ER, I didn't pay single cent since I have our company's medical insurance and I did't think that It's anything serious. The doctor requested different laboratory tests and medications and my insurance was almost 70% utilized. This happened for a three days of confinement only.

My attending physician visited me and finally explained the details of my illness. He told me I have Lupus, an autoimmune disease where my body's immune system attacks my own organs and tissues. I never believed at first since It was my first time to hear about that illness and I dont know anyone from my family who had the same history.

The doctor explained that different factors may affect our body to develop different illnesses not only genetic reasons.

That's when I remembered,Sam, the one who offered me a life insurance with criticall illness coverage that could have potentially help my finances during my treatment. Sad to say, I didn't signed up while I was not yet diagnosed of Lupus. 😞

My medical insurance was fully exhausted and I got no choice but to use my life-long savings and still was not enough. I had to borrow money from family and friends. I swallowed all my pride and even posted my self in social media to ask donations.

If I should have listened to Sam and availed of the life insurance I guess I didn't have to do all of these. And also, it's so hard to get another life insurance plan since I already have criticall illness history. My premiums(payments) are calculated high because of my health-related risks.

If I got one before, I'm sure my personal savings should have been kept and I can still reach my life goals. But it's already too late...

I should have prepared for this...

LIFE INSURANCE STORY

I Wanted To Put Off Getting Life Insurance—But My Husband Didn’t

When I married Peter in 2001, I was 21 years old. I never could have imagined then that I’d be a widow by 26, or that I’d have a 9-month-old baby to take care of on my own.

As soon as we became pregnant, Peter started talking about life insurance—but I was hesitant. I was 24, but Peter was already thinking like an adult. It’s not that I wasn’t an adult; the topic of life insurance was just scary. I was pregnant with our yet-to-be-born child, and the last thing I wanted to think about was one of us dying.

Peter passed away on a Tuesday in March. The weekend before, we’d had an especially good time together. That Monday evening, my neighbor came over to watch a show. Peter sat with us but left early and was already asleep when I joined him later.

The next morning, he left for work without me seeing him. Whether he kissed me goodbye while I slept, I’ll never know. I had a hair appointment with the woman across the street. I was sitting in a chair in her basement when I heard footsteps coming down the stairs. I turned to see my brother, John, who, like Peter, was an Electrical Enginneer. He looked at me and said, “Mary, we have to go.”

I remember him pulling me out of the chair, and driving to the hospital. My first words were, “How bad?”

When we arrived at the ER, the other engineers were there. It was hard for them to look at me—and that’s when I knew.

My story is a reminder that once you have a family—no matter your age—life insurance is absolutely essential.

I didn’t want to think about that at the time, but lucky for me, my husband had.

"Love Insurance"

The right time to buy life insurance varies from person to person, depending on family and financial circumstances. Generally, you need life insurance if other people depend on your income, or if you have debt that will carry on after your death. After all, you don't want to leave your loved ones without money to live on...

Why Younger Is Better
When it comes to timing, the YOUNGER you are when you buy life insurance, the better. This is because at a younger age, you'll qualify for lower premiums. And as you get older, you could develop health problems that make insurance more expensive or even disqualify you from purchasing a plan.

It is also best to get a life insurance if you are still working because you can still sustain on paying for the premiums.

👍🏻👍🏻👍🏻👍🏻👍🏻

Who Should Get a VUL Policy?

VUL is a great choice for the following people:

First-time investors who are just learning the ropes of insurance and investing
Those who lack time, patience, or discipline for investing
Entrepreneurs who want their investments bundled with a life insurance policy to protect their assets
Young parents who are starting to build their children’s education fund

Source: moneymax.ph

What are the Disadvantages of VUL Insurance?

1. Investment Risks

Like other investment options, VUL doesn’t guarantee returns. Investment markets rise and fall—these fluctuations can cause your fund value to go up or down at certain times. In rare cases, policyholders may lose their investment when the fund value is no longer enough to pay for the policy fees. When this happens, the VUL policy gets automatically terminated and all living and death benefits end.

2. More Expensive Than Other Life Insurance Plans

VUL charges higher premiums than term life insurance. You’re paying for the personalized services of your financial advisor (a.k.a commissions) as well as the professional services of the fund manager. VUL insurance providers charge these costs through management fees, policy fees, and annual insurance fees. On the other hand, term insurance charges a little or no fee at all.

Source: moneymax.ph
Photo: pixabay.com

What are the Benefits of Investing in VUL?

1. Tax-Free Death Benefit Payout

The main advantage of VUL insurance over investment-only products like mutual funds, UTIFs, and stocks is that the insured’s beneficiaries will receive the death benefit and investment returns without having to pay an estate tax to the government. The tax exemption applies only to irrevocable beneficiaries[2], though.

In contrast, if you put your money purely in investments and you pass away, your earnings will become part of your estate. This means your beneficiaries won’t get the proceeds until they pay the estate tax.

2. Ability to Withdraw Cash

Unlike term life insurance that provides only death benefits, VUL offers living benefits that policyholders can enjoy while they’re still alive. The liquidity of VUL insurance is one of its best features. You may partially or fully withdraw the policy’s fund value, which is the investment portion of a VUL policy.

Tax-free and interest-free, a withdrawal from a VUL investment can be used to pay for emergencies, your child’s college tuition, medical bills, retirement, or any financial need. If you have sufficient fund value in your VUL policy, you can even settle your unpaid loans to save your property from foreclosure or repossession.

3. Health Insurance Coverage Through Riders

Newer VUL insurance products in the Philippines come with optional benefits, also called riders, that aren’t available in other types of life insurance. These riders include insurance coverage for critical illnesses, accidents, and income protection for hospitalization. Depending on the policy, your premiums may be waived when you’re diagnosed with a critical illness like cancer, stroke, or kidney failure.

4. Potential to Earn Higher Investment Returns

VUL brings the same benefits of a mutual fund: diversified and professionally managed investments. These help yield higher returns than other types of life insurance and even regular savings accounts and time deposits in banks. The premium payments are invested in a variety of assets such as bonds, stocks, and money market instruments. Full-time fund managers handle the investments, too, which raises the earning potential of a VUL policy.

5. Forced Savings

Millennials who find it hard to get into the habit of saving and investing can benefit from VUL insurance that forces them to set aside a portion of their monthly income for the premium payments. VUL insurance providers in the Philippines regularly send premium payment reminders through print and electronic billing statements. Also, insurance agents personally remind their clients of any overdue payments.

Source: moneymax.ph
Photo by Jannoon028 via Freepik.com