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The Philippines has a total land area of roughly 30 million hectares. Nearly half of which (14.19 million hectares) is classified as Alienable and Disposable (A&D) lands, meaning it can be privately owned.

That’s a lot of land. And whether or not it will be utilized for commercial, residential, or industrial use, it’s simple fact that there’s plenty of land to own and develop around the country.

In this article, we’ll take a look at the viability of investing in land along with all relevant information related to it.

What is Land Banking?

Land banking is essentially just another way of saying, “investing in land”. Wikipedia defines it as the “practice of aggregating parcels of land for future sale or development”.

It’s the act of buying raw pieces of land and then either selling it for profit or developing it.

History of Land Banking in the Philippines

The Philippines was occupied by Spain for more than 300 years and this has lead to massive disparities in land ownership in the country.

During Spain’s reign, they issued royal land grants to colonists who built large plantations in Luzon.

The original idea of communal use was replaced with the concept of Regalian doctrine wherein lands were allowed to be privately acquired through the adoption of various laws implemented by Spain (Law of the Indies, Maura Law, Spanish Mortgage Law).

When the American’s came, they gave more power to the Filipinos in managing their own land.

However, many officials in the Philippine government simply took control of the Spanish haciendas and turned it into their own plantations, thus continuing the inequality of land ownership among our countrymen.

Nowadays, Republic Act 386, also known as the Civil Code of the Philippines, is used as the main guideline by which land control and ownership (including leases and rentals) of urban and rural lands.

Why Choose to Invest in Land?

Any investment has some degree of risk tied to it. And so as always, due diligence is required before you set forth on any investment ventures.

But in case you’re wondering what are the potential upsides of land banking compared to other investment strategies, here are 4 reasons:

  • Potential for passive income: If you choose to hold the land (not sell it), you can profit from it via rentals from tenants (more on this on the next section). This can give you a nice source of cash flow that can last for years.
  • You choose whether to buy or hold: Owning land gives you the flexibility of deciding how to earn from it. Say you chose to buy land and build apartment units. Aside from the passive income you’ll earn from rentals, you still have the option of selling it at a later time when the property has increased in value.
  • You can earn from it quickly: Some investors just want to make a quick buck and avoid the “work” required in holding and managing land or property. So what do they do? Buy land then sell it right to the next buyer.
  • Land appreciation: In most cases, land appreciates in value. This is because:  
    • They’re not making more of it (limited supply)
    • Increasing population results in increased land demand
How to Profit From Land Banking in the Philippines

So how exactly do you profit from owning or selling land in the Philippines?

Much like owning similar types of property or real estate, there are 6 ways you can earn from owning land.

  • Flipping (buy and sell): You buy a piece of land (at perceived lower market value) with the goal of selling it to another person or developer at a higher price. As with buy and sell, the strategy is to sell quickly and have very little work required on the seller’s end.
  • Buy and hold: The goal is to purchase land and wait for it to appreciate. The person who invests using this method believes that the land will appreciate in value based on two main reasons: increasing demand and limited supply. As the population increases, so does demand for more land.
  • Buy and build: Instead of selling the land for a quick profit, your goal is to develop it and take a different approach for profit. Perhaps you buy a piece of land and then have a house/apartment units/commercial building etc/mini-mart..etc.,
  • Buy, build, then sell: A modified version of the previous strategy. After buying and building property on the land, you then sell it for profit. More investors will be more interested in buying it since the land has already been developed and the necessary structures have been built.
  • Buy, build, then lease: Similar to the previous strategy but you’ll earn by renting out the property to others exclusively. Perhaps you buy a corner lot and then convert it into parking space or maybe have it rented for food park use.
  • Buy and use: If you’re not interested in building property on the land you bought, you can use it for business or other income-generating purposes. Perhaps the piece of land is deemed good enough for raising livestock or growing crops or serve as excellent fish ponds (for raising fish).

Recommended Reading: How to Invest in Real Estate in the Philippines

What Can You Build on Land?

Here are some of the most common properties you can build on land.

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On a previous article, we learned about some of the best ways and actionable tips to earn your first million.

And while it contained ideas and advice on how to increase your earning potential, it didn’t touch upon the do’s and don’ts on managing money once you start acquiring more wealth.

Why is this important, anyway?

Because as Kiyosaki advised in Rich Dad, Poor Dad:

“It’s not about how much money you make, but how much money you keep.”

Two people can be at the opposite ends of the income spectrum yet the other one (person who earns less) can actually be wealthier in the long run simply because that person knows how to manage her finances.

Too often, we think we need more. We don’t realize that we already have the opportunities and systems in place to start a financially-free life.

Making more money is not always the answer.

It’s a fact that changing our habits and beliefs, especially when it comes to money, is hard.

But if you think about it, having more money is not a requirement to begin changing our ideas and knowledge about it.

We can start this very moment, begin with whatever we have right now.

“I am concerned that too many people are focused too much on money and not on their greatest wealth, which is their education. If people are prepared to be flexible, keep an open mind and learn, they will grow richer and richer through the changes. If they think money will solve the problems, I am afraid those people will have a rough ride. Intelligence solves problems and produces money. Money without financial intelligence is money soon gone.”

We all have that one friend or relative we admire when it comes to managing finances.

We believe that they are by nature, “Magaling humawak ng pera”. We believe that having high financial IQ is something you’re born with.

But this is simply not true.

Like muscles, financial IQ grows the more we put in the effort to make it grow.

But how exactly, should you do it? What are the steps to manage your wealth and money, the right way?

To answer that question, we’ll take a look at how the most successful and wealthy people—the top 1 percent—manage their finances.

And as you’ll soon realize (after reading each tip), they’re really not doing anything special to build and manage their wealth.

The top 1 percent use the same basic principles that you and I can apply.

For example: In his best-selling book, Money Master the Game, world-renowned life coach, philanthropist, and author Tony Robbins shared 4 mindsets that the top 1% investors in the world have in common:

1. They don’t lose money

The logic is simple: If you lose 50% of your money, it takes 100% to get back to where you started.

Aside from the investment and effort required to recoup that lost, you’ll also lose that one thing you’ll never gain back: Time.

2. They look for low risk, high reward

It’s surprising to learn that the most brilliant and successful investors of all time are actually risk-averse.

They look for investments that can bring huge gains with little risk required. An Asymmetric Risk/Reward relationship.

3. They anticipate failure by diversifying

Even the most intelligent investors understand that they’ll lose money on some of their picks.

Their solution?

Minimize the potential losses by diversifying. Everyone who invests money is essentially making decisions with limited information. That’s just the way it is.

And the best investors in the world understand that losses are part of the game. So they prepare for it by minimizing the impact through diversification.

4. They never stop learning and growing

To continuously develop and grow your financial IQ is crucial in your journey towards financial freedom.

Read books, learn from others, invest in improving your money-making and decision-making skills.

What did you notice? What did you think of their advice?  

How come they look “too obvious” and simple?

The answer:

Regardless of your status in life, the rules and principles for successfully managing wealth remain the same.

Like steps in a recipe, we can simply follow the steps and achieve the same results.

There’s one important ingredient though that is an absolute must-have:

Discipline.

To obtain financial freedom, you’ll need discipline.

The discipline to stick to your goals. The discipline to stay within your game plan. The discipline to commit to your vision of a financially successful future. For yourself and your loved ones.

Think of the following tips as the core blocks of building wealth.

Akin to a strong and steady foundation for your house.

These proven, time-tested principles and habits are tools that you can use to craft a better life.

Ready to learn how to build a financially-brighter future? Let’s go straight to the first tip:

1. Cut unnecessary spending and costs

In his seminal book, The Richest Man in Babylon, George Clason shared that controlling one’s expenditures is one of the key ways to avoiding a “lean purse”.

‘Now I will tell thee an unusual truth about men and sons of men. It is this; that what each of us calls our “necessary expenses” will always grow to equal our incomes unless we protest to the contrary. Confuse not the necessary expenses with thy desires.

The road to wealth requires the delay of unnecessary instant gratification in exchange for asset-building and compounding.

To avoid getting stuff that we don’t really need and buy just merely out of impulse.

We all have those moments. But if we really want to get wealthy faster, we have to take the necessary steps to focus on building our assets first.

It’s going to be hard, sure. But isn’t that the case with all worthwhile endeavors?

I’m not saying you forego all unplanned purchases or stop buying stuff that makes you feel good.

The key is to identify which purchases are essential and which ones can be skipped.

Remember, the goal is to simply have more money to invest and save. To determine potential money-drains in your monthly budget. The sooner you develop your mental muscles to resist the urge of unnecessary spending, the faster you’ll reach your financial goal.

2. Automate the saving process

When I first started working, one of the features that our company’s partner payroll bank offered was an automatic savings program via payroll deduction.

Reluctantly, I signed up. I’ll be honest, it was more due to the urging of more financially-wise colleagues than by personal choice.

Not wanting to be left out, I chose to have 10% of my earnings go straight to a savings account.

It was one of those rare moments when peer pressure was actually useful.

Hopscotch a few months later, I checked my balance and was pleasantly surprised at the amount I saved.

I knew I wouldn’t have done it had I chose to do it myself. I was pretty sure I would’ve ended up spending all my income.

But why exactly, does this strategy work?

The Center for Retirement Research at Boston College conducted a study to determine what is the most effective way for the government to urge its citizens to save for retirement.

The findings revealed that automatic savings plans allow households to increase their retirement savings at a much better rate than tax subsidies.

The secret, the researchers conclude, is in the behavior that people have towards saving. They point out that the best savers aren’t the most active ones. Rather, they’re the ones who have a “set it and forget it” approach.

And it makes sense, really. If we can’t access it, we can’t spend it!

Makes me remember a friend who opted not to have the ATM option for her newly-opened savings account.

Her reason? She argued that not having easy access to her savings actually helps her in being more disciplined with not touching her savings.

The added friction of having to line up in a bank just to withdraw money kills any eagerness that she might have during “moments of weakness” to spend.

Nakakatamad nga naman pumunta ng banko at pumila.  

And while this strategy is not for everyone, it serves as proof that we’ll increase our likelihood of saving if we don’t have access to the money.

How to automate your savings

Step 1: Use online tools and personal finance apps to automate the process. Most banks nowadays offer some form of automatic savings program. Check it out and use accordingly.

Check out the Money Apps & Tools section in our “How to Save More Money” guide for a list of popular personal finance apps for saving and budgeting your money.

CNN Philippines also covered a few others that are worth checking.

Step 2: Designate a specific amount or percentage that will go to the savings account

Step 3: Set up automatic payments for your expenses and obligations (credit card bills, rent, etc.,)

Step 4: Automate your deposits into any investment accounts (more on this later)

Step 5: When you can, increase your automatic savings and contributions

3. Set clear financial goals

Deciding you want to take your financial IQ to the next level is one thing. Having a clear set of goals and plans is another.

But why is it important to set financial goals, anyway? Can’t I just save money whenever I can?

The answer is simple: You need to know what you want and where you’re going so you can craft an effective strategy for achieving it.

Imagine this scenario:

You ask your buddy how to get six pack abs (he looks fit so you thought he might have an idea).

He looks at your round belly and says, “That’s simple, just do cardio exercises and cut rice!”

Now, I’m no gym expert. But I’m pretty sure running dozens of kilometers and cutting back on rice won’t get you those pandesals on your stomach.

And the same logic applies when it comes to setting goals and strategizing in general.

Clear goals + right strategy = Success

You need to know what you want so that the steps you’ll take will be in line with your goals.

Let’s say you want to save and invest 100,000 pesos by year end. Applying the advice above, the first step would be to identify the ways you can save 10,000 a month.

After that, you’ll narrow down your list based on your skills and strengths. You’ll then start devising a strategy to get that 10k/month savings.

Should you get a side hustle? Perhaps enroll in a language class so you can (hopefully) get for that language premium bonus at work?

Maybe you want to launch a blog and earn from ads and affiliate income? Sell life insurance on the side, perhaps? Or maybe you can work part-time on weekends doing some remote online jobs?

O baka naman kailangan ko lang talaga magbawas ng gastos?

Having clear goals is essential in achieving financial freedom. Aside from the above, here are other reasons why you should have clear financial goals:

  • It helps you determine how much you need to save (aside from the other methods listed above)
  • Each financial goal will need a different set of strategy. This is important as a goal of saving for retirement will require a game plan that’s different from saving 100k.
  • It helps determine some of your career decisions.
  • Having clear goals means you have to be laser-focused. It gives you that extra push of motivation on days that your willpower or energy is low.
  • Setting goals is good for you. It helps you develop your physical and mental muscles. It pushes you to go past your comfort zone. It helps you avoid the trap of “going with the flow”.    
4. Start tracking your expenses

If you’re really keen on managing your finances like the top 1 percent, you have to make the effort of having a clear understanding of how you spend your money.

And the most effective solution is by tracking your expenses.

“How to be you po?” I jokingly asked one friend who not only tracks her spending—she actually seemed to enjoy the process.

A disciplined saver, she said it acts as her “logbook” of activities, giving her insight not only on how she has been spending, but also serves as a reference for when she’s budgeting her family’s money.

Why is this important? What’s the real purpose of tracking all the money we spend on a regular basis?

The first reason is that tracking our spending makes us aware of where exactly our money goes.

It allows us to pinpoint which portion of our budget gets eaten up by discretionary expenses, for example. These are stuff and purchases that we can (technically) live without but prefer not to do so.

Not that spending money beyond the basics is wrong. However, if you really want to have success in achieving your financial goals, you have to be more purposeful with how you spend your dough.

And being purposeful spender requires that you first become aware of the stuff that you spend money on.

Once you know where your money goes, you can then craft a spending plan (a.k.a budget) that will suit your needs and preferences.

Here’s a high-level overview of what you need to do to start tracking your expenses:

  1. Create a budget worksheet for tracking your expenses. You can see sample templates on our How to Budget Guide
  2. Once you know how your money gets spent, craft and make adjustments accordingly based on your goals.
  3. Be diligent in tracking your progress. All changes on your spending should be noted in the worksheet so you’ll know how you’re doing.

Let’s say you want to save 20,000 by the end of the year to invest it in stocks. You figured that you can easily hit this goal by stashing away roughly 1,700 pesos each month.

After coming up with that number, it’s now time to determine which expenses (on a monthly basis) you can trim down (or cut indefinitely) to hit the monthly target.

Perhaps your tracker revealed that you’ve been spending a little too much on lattes and coffee lately.

Or maybe your weekly strolls at the mall has been costing you a bit more than you realize.

Some might admit to spending more than they should on Shopee or Lazada because of those daily free shipping vouchers.

As soon as you make these realizations via expense tracking, you can then start making adjustments to your spending.

Again, the idea is not to scrimp on your spending just because it helps you save more.

The real reason you’re doing this is because tracking expenses creates financial awareness.

It helps you not lose money. Which is, by the way, the first advice from our list of recommendations earlier from the world’s top investors.

Ready to start tracking your expenses? Our comprehensive guide on how to budget your money lists down more ways you can control your spending.

5. Create an emergency fund

Think of having an emergency fund as a financial safety net for yourself and your family.

It’s about being prepared when financial hardships arise, so you can smoothly transition from the difficult undertaking back to getting your (financial) groove back.

That’s all there is to it, really.

The “hardest” part is developing a savings system that will work based on your budget and preference.

But it’s not that complicated, actually. In fact, there are several ways you use to build an emergency fund.

One popular example is the 50-20-30 rule. Put simply, you spend 50 percent of your earnings on the essentials (non-discretionary expenses like food and shelter), 20 percent goes to investments and savings, while the last 30 percent is for discretionary/optional expenses like entertainment and luxuries.

As simple as it is, applying this budgeting technique will allow you to steadily build a savings fund for emergency use. Perhaps you can do a 50-50 split on the 20 percent so that the 10 percent will be tagged for emergency use exclusively.

You may be wondering, “But how much should I keep in my emergency fund, exactly?”

There is no hard rule for it, but most financial experts advice to save at least 6 months worth of salary for a 1-income source family.

If there are two sources of income, 3 months worth of salary might be enough to cover your expenses during financial droughts.  

But don’t go overboard with it, even if having “sobra” on your emergency money looks like a good idea.

Why? Because you’ll likely have better returns for that excess money if you put it in other investments.

Instead of stashing away 1 year worth of income, for example, perhaps you can save 6 months worth and invest the rest on other investment vehicles, like stocks or bonds.

If you’re curious to know more emergency fund-building tips, check out our Emergency Fund guide.

6. Let your money work for you

“Put each coin to work so that it may reproduce its kind even as the flocks of the field and help bring to you more income, a stream of wealth that will flow constantly into your purse.”

– George S. Clason, “The Richest Man in Babylon”

When I first read this section on the book, I remember literally imagining gold coins walking and working in a Looney Tunes kinda way.

Perhaps it was the quirkiness of this imagery that made me remember all about it. As weird as it may sound, however, you can’t deny the truth behind its message:

If you want to be rich, you have to invest your money and make it work for you.

The wealthiest people of the world will tell you that this is what separates 80 percent of the world’s population from the top 20 percent.

While most of us are OK with putting our money in savings accounts in banks, rich people think of ways they can make their money multiply.

But how come most of us would rather earn and simply stash away any excess in a bank?

The reason, in my opinion, is that making your money work for you requires more work. You’ll have to be more disciplined in managing your money.

Also, investing comes with a certain level of risk.

But as the top investors in the world revealed earlier, risks can be minimized. It shouldn’t stop you completely from trying to make your money work for you.

In the “5 Rules of Gold” section from the same book by Clason he shared how we should invest our money:

“Gold slips away from the man who invests it in business or purposes with which he is not familiar or which are not approved by those skilled in its keep”

“Gold flees the man who would force it to impossible earnings or who follows the alluring advice of tricksters and schemers or who trusts it to his own inexperience and romantic desires in investment”

The lesson?

Invest in things you understand and know. Don’t fall for investment schemes that sound too good to be true.

And you should begin by learning more about investing. Read and learn all you can about the investment vehicle you’re interested in using.

By doing this, you’re exposing yourself to the tools and opportunities that wealthy people use to build their assets.

More importantly, you’re significantly reducing the levels of risk, simply because you’re learning and grasping everything you can about investing and doing your due diligence before putting down the money.

One last thing: In investing, timing is crucial.

A person who started investing 5 years earlier will yield more in 30 years than the person who invested 50% more but started later.

That’s the power of compound interest.

If you want to know more about the power of compounding and all the various (and totally legit) ways of investing your money, here are good places to start:

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Who wants to be a millionaire?

I’m not talking about the game show (even if it’s a legit way of getting a boatload of money real fast).

I’m talking about amassing revenue and profit that actually gets you into the million-peso club.

A 2017 Credit Suisse report revealed that the average net worth of 86% of Filipinos was $9,773 (around 488,000 pesos).

The same report showed that we have a highly unequal wealth distribution in the country, as only 0.1% of the total population were considered US dollar millionaires.

But that’s not the point of this article. I’m not here to blabber about our country’s living conditions nor highlight its highly skewed distribution of wealth.

I’m here because like you, I also dream of a better life by earning more and becoming financially free. Truth be told, I couldn’t care less about being a “dollar millionaire”.

I’m all for figuring out how to build wealth and giving myself and my loved ones a comfortable life.

Who doesn’t? We’re a family-first type of people after all.

But why aim for a million? Why the need to set an exact number to target?

Because having a specific goal forces us to come up with ways to actually reach it.

I once read somewhere:

“If you aim for nothing, you’ll hit it every time.”

And that’s what this article is all about.

To give you 10 legit ways to help you make your first million pesos. Hope you find these useful.

1. Become a specialist

Arguably the least entrepreneur-centric way of getting to millionaire land.

The idea is simple: Master a skill that catapults you to the top of your field.

Whether you’re a doctor, an architect, painter, programmer, author, or (insert profession here), establishing yourself as one of the elites in your chosen field guarantees demand—and with it, the big bucks.

But how exactly, does one become a master on any kind of skill or profession?

Watch this 1-minute video from Mark Cuban:

Mark Cuban - Don't follow your passion - Insights for Entrepreneurs - Amazon - YouTube

This quote from actor and stand-up comedian Steve Martin pretty much sums it up as well:

“Be so good they can’t ignore you”.

Best-selling author and professor, Cal Newport, actually used this as the title for his book. In it, he argued that learning to love what you do is better than ditching it for something you love.

He goes against the popular advice of “Do what you love” or “Follow your dreams”.

Those, according to him, can actually be hazardous to your career and finances without the proper preparation and skill set required to succeed.

Instead, Newport recommends to adopt a craftsman’s mindset and acquire valuable and rare skills that will elevate you above the pack.

He says that jobs that people love have 3 things in common:

  1. Provides high levels of freedom and control (you do have to increase your rare and valuable skills first though to be able to demand a high level of control)
  2. Can provide a source of income
  3. Provides a sense of mission and purpose (you’re motivated to push yourself and master the stuff, be the best)

It’s great advice, really. To believe that you have the capacity to become a specialist at the job you have right now (even if it’s not your dream job) and be able to command top money for it puts you on the right mindset to aspire to earn millions.

2. Sell products online (Shopee/Lazada/Facebook/Own website)

Each time I order Kapeng Barako beans in Shopee, I can’t help but think, “I wonder how many kilos these guys sell in a day?”

Same goes for all other stuff I order online. Whether it’s from a big retailer or from a small, personal shop, I’m amazed and curious at the same time at the revenue generated by online businesses.

I stumbled upon an episode of ABS-CBN’s business-oriented show, “My Puhunan” last year as I was mindlessly scrolling on YouTube. After watching, it gave me a glimpse at the earning potential of online businesses.

It was the story of a guy and how he went from being a massage therapist and security guard to building his online business, “Mr. Suki Mo Ako”.

He started by selling wireless Bluetooth earphones in Facebook Groups which eventually branched out to all sorts of gadgets and accessories. Using Php8,000 as capital, he was able to grow his business big enough to earn 90,000-100,000 a month (at the time the episode was released in 2017).

I bet he earns at least 2-3 times of that figure now if he was able to scale it properly. And even if not (which I seriously doubt), he can easily reinvest his earnings and buy more stock and maximize his sales.

Things couldn’t be easier right now if you are an entrepreneur.

Even without a physical store, you can sell and ship products to almost anywhere in the country.

The guy from my example above packs his wares on his living room floor, for example. Once orders are placed, he goes to the nearest LBC and ships them personally (after his tie-up with Shopee, orders were being picked up at his house)

Without online marketplaces like Shopee or Lazada (and other places online), I would be stuck with buying tasteless and expensive ground coffee in supermarkets. It’s a win-win situation for both seller and consumer.

Related: Top 100+ Online Shopping Sites in the Philippines

3. Invest your money

If Bro. Bo Sanchez’s maids can save up to a million, what’s stopping you?

When we reached out to him to ask what’s his best tip for building wealth, this was his answer:

“Building wealth requires radical patience. …to actually build passive income, you need radical patience. My two maids are millionaires today.  People are awed by that, but it took them more than 8 long years of slow, steady investing. I repeat: Radical patience. That’s the key to building passive income.”

For most Pinoys, banks are the go-to place for stashing away our savings.

While there’s absolutely nothing wrong with that (banks are a great place to keep your emergency fund), you’re missing out on the earnings potential of your hard-earned cash.

And that’s what Bro. Bo taught his maid, Gina. Instead of lazily putting it in a bank and earning at an abysmal rate (where your Php100k could earn just enough to buy you a movie ticket after a year), she learned about stock market investing and slowly and steadily increased her investments.

Within 6 years, she was able to grow her stock portfolio to 800,000 pesos in 2016.

Even without a high-salary, she was able to grow her money at an impressive rate that can only be achieved via discipline, consistency, and yes—radical patience.

To give you ideas on how and where to start, I highly recommend checking out our list of 12 Best Investments Under 100k.

5 Quick Tips for Saving More Money So You’ll Have More to Invest
  • Establish a monthly budget
    • Track your spending and analyze how your money gets spent monthly.
    • Build a budget and stick to it
  • Cut back on expensive habits
    • Try switching to less-pricey alternatives
  • Get rid of debt
    • Pay off all high-interest debts first (credit cards, loans, etc.,)
    • Set aside a set amount for paying off your debts. Make it automatic.
  • Don’t keep up with the Joneses
    • Spend only on things and experiences that truly matter to you
    • Avoid buying something just to impress others
  • Automate your savings

Recommended Reading: How to Save More Money

4. Run a Franchise Business

Owning a franchise business essentially means the company (franchisor) granted you the rights to sell their products.

It allows people like you and me to own and operate businesses with popular and established brand names that people recognize and trust.

Aside from its brand name, you will be handed over a tried and tested business model so you won’t have to figure out the ropes yourself.

It’s like getting under a mentorship program. Someone will teach you everything you’ll need so you can use that knowledge and be successful yourself.

And while this sounds great, it does have its own set of cons. Mainly, the fees you have to pay and lack of complete control over the business.

After all, you’re merely “renting” the brand name. And as with all businesses, there’s never a 100% guarantee that it will always succeed.

However, franchise businesses are still popular as it takes out much of the guesswork and labor of building a business from scratch. And with a trusted brand name on your signboard, people are more likely to transact with you.

3 Helpful Tips for Franchise Success
  1. Pick the right franchise – Consider your interests and the trust and demand for the product/brand as main factors for choosing a franchise.
  2. Get business-savvy – While franchisors will hold your hand during the setup process (and provide support as needed), you definitely have to develop the chops to run a business effectively. Aside from learning from experience, level-up your knowledge by attending seminars, getting advice from other business owners, reading the best business books, joining mastermind groups, and so on.
  3. Clarify all questions and conditions with the franchisor – You’ll be handing them your hard-earned money after all, it’s imperative that you do your due diligence in knowing everything you can about them and the franchise.

Here are some questions you might want to ask the franchisor:

  1. How much is the total investment package?
  2. Are there any royalty, branding, marketing, or advertisement fees? If so, how are they computed?
  3. Can you describe your training program in detail?
  4. Do you provide assistance for site inspection, evaluation, selection, and construction? If so, do you charge an additional fee for this?
  5. How do you evaluate locations?
  6. How long will it take until I earn a profit?

For a more in-depth look at how to own a franchise business in the Philippines, check out our comprehensive guide here: 25 Best Franchise Business Opportunities in the Philippines

5. Be a Top YouTuber

When I need to cook something, there’s only one place I go to for help:

The Panlasang Pinoy channel on YouTube.

Whether it’s basic adobo or more complex ones like (insert ulam here), I’m 101% sure Vanjo Merano (the dude behind the channel) has a how-to video for it.

Around Christmas time last year, I saw a TV ad with him on it promoting one of his go-to ingredients.

A product tie-up (sponsorship) plus a continuously growing channel. “Not bad, Panlasang Pinoy, not bad”, I thought.

With close to 1.8 million subscribers, I’m pretty sure he has hit the million peso mark already (if we’re talking about total YouTube earnings). I wouldn’t be surprised if he makes several million pesos from YouTube in a year, actually.

How do you (and how much can you) earn in YouTube, anyway?

There are 2 main ways YouTubers get paid:

  1. Number of ad views
  2. Number of ad clicks

The math behind calculating actual earnings is not a straightforward affair, however. There are several factors that affect the amount of revenue a certain video or channel gets paid.

Also, when a channel grows big enough, affiliate marketing options come into play (like the product tie-up Panlasang Pinoy has).

Bottom line? It’s simply near-impossible to accurately nail down YouTube net revenue.

But if you’re still curious (even just for an estimate), then this “YouTube Money Calculator” might help.

Here’s what I’m 100% sure about: Whether you’re going at it full-time, as a side hustle, or just for fun, getting a massive amount of page views in YouTube will definitely let you earn some serious bucks.

It’s not for everyone, sure, but those who do make it (top 5 to 10%) are definitely getting their pockets filled.

6. Build a Blog

As the country that spends close to 4 hours on average daily on Facebook, you’d think there’s not much sense building a blog since everyone seems to be on social media anyway.

The truth is, blogs are never going to go away. Ever.

As long as the content is valuable, useful, and entertaining, there will always be an audience for it.

And with a big enough readership, there are tons of ways you can monetize it.

You can run ads, set up affiliate partnerships, sell stuff (physical or digital products), use it as a platform for getting clients, and so much more.

There are thousands of sites in the Interwebs right now generating hundreds of thousands (dollars) worth of revenue.

I know of a site that generates a gross revenue of $200,000 (10 million pesos) per year at 350,000-500,000 page views per month. It’s a site about succulents, and she basically built a revenue-generating machine by blogging about cute little plants.

And that’s the awesome part. The possibilities for monetization are plenty. Even merely posting articles and getting page visits will still earn you money via ads.

Sometimes, when a blog gets really big (pageviews of more than a million a month), companies buy them to the tune of several million dollars (yes, dollars) or more.

Such is the power, reach, and usefulness of blogs.

Take the popular review website, The Wirecutter, for example.

It’s founder, Brian Lam, started the site in 2011 with about 10 posts per month, doing in-depth reviews on some of the best gadgets.

Fast-forward to 5 years later, the New York Times bought his site for $30 million. That’s right, 1.5 billion pesos.

And while that sounds like a unicorn story, this actually happens quite a lot. Once a site gets massive viewership, people and companies notice. Even if the site “only” generates a couple of hundred thousand pageviews per month, there’s still plenty of reasons that make it look very appealing for big businesses to buy it.

Making your own blog is easy. In fact, you can do it in 20 minutes. Check out our in-depth guide for building a blog with a full, step-by-step walkthrough. The “blog” section of this article also provides some great information on how to set up one yourself.

7. Make an App

At its peak, the now-defunct Flappy Bird grossed up to $50,000 (2.5 million pesos) per day. For those who are unfamiliar, it was a mobile phone game where you had to control the bird so it won’t hit the pipes. And that’s it, basically.

As simple as it was, the game was highly entertaining and challenging which catapulted it to overnight success. Proof that you don’t have to come up with the most complex of ideas to score big in the world of app development.

While Flappy Bird was an indie game created by one guy, blockbuster games like Clash of Clans with big budgets from its developers pull in annual revenue of close to 1 billion dollars during its prime.

Outside of games, there are literally dozens of categories to set your sights on. Just check out your phone’s app store and you’ll see what I mean. And even if you don’t come up with a massively popular one, there’s still incredible revenue potential for something that you don’t have to work on every day.

Not a programmer? Not a problem!

You can hire people to make your app. Online job marketplaces like UpWork allows you to hire app developers who work remotely across the globe. Just be sure to do your due diligence and be smart with hiring the right people so everything will go smoothly.

8. Turn your passion into a Business

Jason Magbanua is considered as one of the premier wedding videographers in the country.

A quick look at his website shows his current rates: 150 or 175 thousand pesos for each of his wedding video packages. For international projects, rates start at $9,000 (Php 450,000).

He can easily make a cool million by just booking 6-7 projects locally.

And I’m willing to bet that since he carved himself as one of the top dogs in this niche, demand is probably more than he can handle.

Perhaps you’re into calligraphy, yoga, digital animation, photography, baking, (insert your passion here) and have tons of knowledge and know-how on the subject. Why not earn from it?

You can do it in two ways:

  • Get clients who need your services as an expert
  • Teach others what you know (set up paid workshops or act as a consultant)

In the case of Jason, he does both (his website showed he offers workshops/seminars as well).

I have a friend who taught herself how to bake and she has been steadily getting clients in the last few years. And even if she only does it on the side, she’s getting good money from it.

And the same process can be applied across all sorts of hobbies or passion.

Each one has the potential to scale. In my friend’s case, perhaps she can hire assistants to increase production and build it big enough to encourage her to open up her own bakeshop.

A yoga instructor can move from one-on-one sessions to setting up classes and opening an actual yoga school.

And so on.

People who are interested in and has a need for your service or product will gladly pay. And the more people you’re able to help, the faster you can scale up your business.

9. Work abroad then put your money where it can grow fast (business, investments, etc.,)

In 2017, there was an estimated 2.3 million Filipinos working abroad. I bet you have a relative or a friend, colleague or acquaintance who is an OFW. It’s very common in our country.

And the number one reason (well, aside from lack of better opportunities here for some) is the earning potential.

You can easily earn 3 to 5 (even 10) times as much as you would earn here, doing the same job.

I’ve seen people work abroad for years, building enough assets to fund a business so they can stop working away from home.

Whether it’s getting a franchise deal, building a business from scratch, or even putting your money on passive investments and then letting compound interest do its work, having a big enough asset base is crucial if you want to grow your money into the millions.

Do note that you can achieve the same results without having plenty of capital to work with. Just keep in mind that it will probably take a bit longer.

If you’re curious to know what type of money-building options you have for your OFW income, here are great places to start:

10. Get a Millionaire Mentor

Or work with someone who has already accomplished what you wish to have.

Having a mentor simply means having access to the wisdom and connections that will make your push towards your first million faster.

Even if you can’t actually “mentor” under this person, you can try and work under their wing, or simply observe and analyze how they do stuff, and learn as much as you can.

Think about it. Who’s that one person you know and want to emulate when it comes to building wealth?

You can always ask. It wouldn’t hurt to try.

You’d be surprised that they are often willing to share what they know.

Aside from having an actual mentor, always look for ways to improve your skills, build your network, and consider taking training (seminars, workshops, mastermind groups, etc.,) and expose yourself to books and other useful material.

With enough exposure, trial and error, and the right mindset, you’ll eventually find your very own path towards success.

And there you have it. Our best tips for making your first million.

Want to know more about wealth-building and how to earn the big bucks? Here are resources to get you started.

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The real estate market in the Philippines has been on a steady rise and does not show any signs of slowing down soon.

With increasing demand both within and outside of Metro Manila, expect even more projects and land to be developed in the next couple of years.

What is Real Estate / Property Development

Real estate and property development is a business process which includes the buying and selling of both raw and developed land, as well as the renovation or development of existing structures (buildings, establishments, residences, etc.,).

These activities are managed by real estate developers. They buy land, provide funding for real estate deals, build or connect with construction companies to develop the land.

Why Invest in Philippine Real Estate

Top real estate and investment management firm JLL ran a piece back in January revealing their bullish outlook on the real estate industry in the Philippines.

They predict favorable conditions overall: The demand for real estate space by the BPO sector as well as increasing demand from emerging real estate stakeholders like technology companies and flexible space operators will continue to make significant inroads into the Philippines’ property market in 2019.”

The cultural shift led by the millennial generation to a community-based lifestyle will drive the popularity of co-working and co-living in the Philippines. The increasing demand for co-working spaces will encourage more foreign flexible space operators to increase their presence in 2019.

But it’s not only in the office sector where things are projected to boom.

Here are some of their insights on specific markets:

Residential
  • Upper-mid to luxury segments still continue to have strong demand
  • BGC and Makati expected to benefit from high demand for office spaces from BPOs and online gaming firms. The influx of expats working for these offshore businesses also drive growth for the leasing market in Makati and BGC
  • Strong rental rate growth especially in Bay areas (Pasay and Paranaque)
  • BSP revealed an increase in residential condo prices in Metro Manila by up to 6.4% year-on-year
Hospitality
  • Increase in demand for real estate investments in the Bay area (3,000 rooms added)
  • Some of the notable establishments completed: Grand Hyatt, Citadines Bay City Manila, and Hilton Manila City.
  • A cumulative 7.4% year-on-year growth on tourist arrivals was posted in 2018 despite the closure of Boracay for a couple of months
  • Hotel-casino establishments in Paranaque (envisioned to be the Las Vegas of the Philippines) command the highest prices per room
Retail
  • Additional 348,900 sqm of retail space was completed in 2018
  • Vacancy rates for retail shopping centers are still low at 3.7%
  • Strong demand for retail spaces by both local and foreign brands (fashion segment leading the way) drove rental growth up
  • Solid macroeconomic environment in the country fosters growth especially with the relaxation of the Trade Liberalization Act that should result in increased foreign investments
  • The government has started discussions about the implementation of Real Estate Investment Trust (REIT) law which is expected to help draw more foreign investments

Colliers Philippines, a leader in Commercial Real Estate services, advises that flexibility, or the ability to adapt to changes brought about by emerging trends and economic factors, will be crucial in the success of the property market in 2019.

Here are some of the factors they said will affect the outcome of the real estate market in 2019:

  • The government’s aggressive infrastructure development will dictate the strategy of developers. Firms will be more open to acquiring land in Northern and Southern Luzon.
  • Strong demand for office space will carry on in 2019
  • Flexible workspaces are starting to get more traction. It’s expected to rise at least 10% yearly
  • Luxury residential market remains strong
  • Food and beverage, fashion segment, drive retail markets

Related: 12 Best Investments under P100K in the Philippines

10 Best Cities to Invest in Real Estate in the Philippines

Choosing which cities to pick when it comes to real estate investing is no easy task. And doubling down on a specific location simply because it’s popular isn’t going to guarantee instant ROI either.

There’s just too many factors and stuff that goes into investing in general that it will be hard to recommend a winner based on location alone.

However, we can take a look at which areas are the go-to picks of some of the country’s biggest property developers and perhaps use that as a reference to determine which cities are considered to have the strongest demand and ROI potential for real estate investing.

Here’s a quick list of the annual growth rate (property appreciation) in some of the most developed cities in the country. This should help you determine how much returns you can get from your investment.

LocationLanded HousesCondominiums
Quezon City25%5.3%
Makati163.5%42.5%
Cebu24.1%14.4%
Davao0.7%8.1%

And below is a list of cities ranked according to the most number of real estate projects and properties by developers featured on the following section. (Source)

1. Quezon City
  • Strong business climate
  • Highly urbanized
  • Easily accessible via a wide range of transport systems
  • Top leisure spots (restaurants, malls, parks, etc.,)
  • Home to some of the top medical facilities
  • Major government offices are located here
2. Taguig
  • Has established itself as a strong financial district
  • Development of infrastructures for new businesses has been on the rise in the last few years
  • Has a high demand for high-end residential and commercial spaces
  • Plenty of leisure spots
3. Makati
  • Home to top local and international corporations and businesses, considered as the financial center of the country
  • Easily accessible via almost all methods of transportation
  • Highly urbanized
  • Has all the facilities and establishments to support modern living (schools, hospitals, malls, companies, etc.,)
  • Big POGO (Philippine Offshore Gaming Operation (POGO) market
4. Manila
  • Home to heritage sites, the seat of Philippine National Govt
  • Bay Area (Manila Bay Freeport Zone) has been experiencing dramatic growth in real estate development due to the influx of POGO players and employees
  • Strong cultural background
  • Home to some of the top universities and schools
  • Strong retail and market activity
5. Pasig
  • Ortigas CBD continuously attracts development of both residential, commercial and business properties around the area
  • Real estate development has been on the rise in the past few years
  • Plenty of commercial establishments (F&B, malls, bars, etc.,)
  • Easily accessible via land and water (they have a river ferry service)
6. Mandaluyong
  • Shaw Boulevard-Pioneer area is home to some of the country’s top food and medicine manufacturers, also houses numerous BPO companies
  • The area has seen a steady rise in the development of both residential and commercial spaces
  • Greenfield district
  • Easily accessible
7. Cebu & Davao
  • Booming BPO and IPO businesses attract plenty of investors
  • Demand for residential condos has been on the rise
  • Urbanized but hasn’t lost its provincial touch thanks to its beaches and tourist spots
  • Davao posted a 9.4% growth in 2016, besting the country’s overall growth
  • Luxury condos are increasing in development signaling growth in demand from the high-end segment
8. Pasay & Paranaque
  • Flourishing business district
  • Paranaque is home of PAGCOR Entertainment City (Solaire Resort and Casino, City of Dreams Manila, Okada Manila, and soon-to-open Westside City Resorts World)
  • Philippine Offshore Gaming Operation (POGO) gives its real estate market significant boost in clientele
  • Near airports and main thoroughfares
  • Plenty of malls and commercial establishments
9. Santa Rosa & Calamba
  • Calamba is dubbed as the “Richest City in Calabarzon” and tagged as one of the next wave cities for outsourcing firms
  • Calamba is a haven for various industries and companies (IT Parks, food processing plants, semiconductor companies, automobile, etc.,)
  • Santa Rosa is considered the richest city in South Luzon in terms of annual income
  • Santa Rosa is home to special economic zones and industrial parks
10. Imus & Dasmarinas
  • Both cities have seen a rise in income earning in the last few decades
  • Both cities serve as a preferred site for industrial establishments
  • Ayala Land invested P70 billion for developing Vermosa estate, located between Imus and Dasmarinas
  • Continuous development of lands and modernization has been happening in the last couple of years
Top 13 Real Estate Property Developers in the Philippines 1. Ayala Land

The company specializes in planning and development of large scale projects which involves the following: residential lots and buildings, commercial and industrial lots, office spaces, and commercial and IT parks.

They also engage in property management and construction.

  • Specializes in: Malls, Residential buildings, Hotels and Resorts, Estates (Makati CBD, Ayala Center, McKinley Exchange, etc.,) Property management services
  • They also own other services and properties like QualiMed (Health & Medical care), Merkado (Supermarket), AirSWIFT (Boutique airline)
  • Price range of properties:
    • Condominiums – Php 1.4 million -5.7 million
    • Townhouse – Php 2.7 million – 7.1 million

Below are some of Ayala Land’s current projects:

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Everyone wishes to retire early. Who doesn’t want to? Even workaholics would hate slave-driving themselves to work when they’re old and gray.

Yet not everyone is saving up for retirement.

A recent study confirms the Filipino millennials’ lack of preparation for retirement. Only 7% of the young professionals surveyed have a plan for saving monthly. The study also notes that millennials in the Philippines invest rather inconsistently, doing it only “when they feel like it.”

While it’s easy to put retirement planning on the back burner in your 20s or 30s, what with the many financial obligations to deal with, you can’t just disregard its importance and urgency.

Time goes by faster than you’ll realize. You don’t want to be that senior citizen who regrets not having saved up for retirement sooner.

So waste no time and plan your retirement while you’re still young. It takes a long time to build a retirement fund that assures you’ll live comfortably with financial security.

Contents

What is retirement planning?

Retirement planning refers to planning and managing your finances to prepare for life after you stop earning income. It involves determining how much money you need when you retire and how you’ll achieve that goal through savings and investments.

Why make a retirement plan at a young age? Because life is uncertain.

You’ll never know how long you’ll live and whether or not you have enough funds to sustain your lifestyle when you retire. Planning for retirement minimizes that risk.

To plan your retirement properly, you have to consider not just the financial but all aspects of life in your golden years:

  • Your desired retirement age
  • How much money you need for your retirement years
  • Where your retirement income will come from
  • Where you’ll retire
  • The lifestyle you want to maintain in your retirement years
  • How you’ll build your retirement fund
  • Long-term healthcare plans
  • How you’ll manage and protect your assets before and after death
How much money should you save each month for retirement?

Financial experts recommend saving 10% to 15% of your income for retirement, starting in your early 20s.

That’s the ideal scenario. However, not everyone begins building their retirement fund at age 20.

If you start in your 40s or 50s, saving only 10% of your income will never be enough because you have little time left to save until your retirement years. The percentage of retirement savings must be higher when you start later in life.

To meet your retirement goal, you’ll have to save 24% of your income when you start at age 40 or almost 50% if you start at age 50.

For an easier computation, use MSN Money’s online retirement savings calculator.

Let’s say you’re 25 years old and earning Php 25,000 monthly. You’re expecting to retire by 60 and live until 70 (the average life expectancy in the Philippines based on the latest World Health Organization data).

Experts peg the annual income after retirement to be at 70% to 80% of one’s current annual income.

With a yearly income of Php 240,000 and an investment return of 5%, you’ll need to set aside at least Php 20,518 per year (around Php 1,700 monthly).

3 stages of retirement planning

Retirement planning is a long-term process. It’s more like a marathon than a sprint. Take things a step at a time, preferably as early as possible, to ensure that your savings will outlive your post-retirement living expenses—and not the other way around.

How you plan your retirement will vary at each stage of your life. Your income, expenses, and financial status will be different in your 50s than when you’re younger. For a successful retirement planning, it should adapt to the various phases of your life.

First stage: Aggressive wealth accumulation and growth (Age 21 to 35)

This is the phase when retirement planning is at its easiest. In your early 20s to mid-30s, you’re starting your career with just a little money to save and invest.

There’s not much pressure yet because you’re just starting to save money for retirement.

However, your biggest advantage as a young adult is the time you have to grow your money before you retire.

That’s the power of compound interest—what you invest today will grow exponentially over time. The earlier you invest (even if it’s only a small amount), the higher retirement you’ll accumulate.

So focus on saving and investing as much as you can. The first stage of retirement planning is the best time to invest aggressively in long-term, medium-risk to high-risk instruments like mutual funds, real estate, and stocks.

Second stage: Continued asset growth (Age 36 to 50)

Even if they’re earning more than when they were younger, people in their early midlife face tough financial challenges, from raising a family to paying off mortgage.

Despite financial setbacks in your late 30s to early 50s, it’s still important to keep setting aside money for retirement. Yes, even if sending your children to school or paying down debts is your priority right now.

At this stage of retirement planning, you still have time to grow your savings. You also have more information to evaluate your finances and whether or not you’re on track with your retirement savings.

Don’t forget to get life insurance and build an emergency fund so that whatever happens, you and your family can survive without spending your retirement fund.

Third stage: Pre-retirement (Age 51 to 60)

With less than 10 years away from retiring, you have a clearer idea of how much you’ve saved and how much you’ll actually need to cover your post-retirement living expenses.

By this time, you likely have major expenses like your children’s college tuition, home mortgage, and other debts paid off, leaving you with more disposable income to save.

The last stage of planning for retirement must focus on ensuring that your finances are in order. Your money should be placed in more conservative, low-risk investments for capital preservation such as savings accounts, time deposits, and money market accounts.

Consider setting aside funds for your long-term healthcare needs, such as hiring a caregiver and buying your maintenance medicines.

5 Ways to Build a Retirement Fund

What’s the best way to save money for retirement? Certainly, it isn’t letting your money sit in the bank.

Traditional savings accounts in the Philippines earn measly interest rates of less than 1%. Neither is relying just on pension from the SSS or GSIS and retirement benefits from your employer.

Instead, go for long-term investments that yield higher returns and beat the impact of inflation on your retirement savings.

Consider including these five types of investments in your retirement portfolio.

1. VUL Insurance

Minimum initial investment: Php 2,000 per month

Estimated fund value after 25 years: At least Php 2.5 million (with Php 2,000 monthly premium and an average 10% annual return)

Variable universal life insurance (VUL), sometimes called variable unit-linked insurance, is a type of life insurance plan with an investment component.

This two-in-one financial product invests money in various instruments such as bonds and stocks for retirement (and other long-term financial goals) while providing living, disability, and death benefits when the policyholder dies or becomes permanently disabled.

So whether you live too long or die too soon, you and your family are financially protected if you have a VUL insurance policy.

How to get VUL insurance:

Contact a reputable life insurance provider that offers VUL insurance products or approach one of its agents that can guide you through applying for a VUL plan.

Learn More: How to Get a Life Insurance: Top 10 Life Insurance Companies in the Philippines

2. Personal Equity and Retirement Account (PERA)

Minimum initial investment: Php 1,000

Estimated fund value after 25 years (with average 10% annual return):

  • Minimum contribution of Php 1,000 per month: Php 1.24 million
  • Maximum contribution of Php 100,000 per year: Php 10.91 million

PERA is a voluntary savings and investment account meant to help Filipinos build their retirement fund. It aims to supplement pensions that retirees receive from the SSS or GSIS.

Funds are invested in diversified instruments that include stocks, government securities, mutual funds, and unit investment trust funds (UITFs).

Everyone—whether employed, self-employed, or OFW—who’s earning an income and has a tax identification number (TIN) can invest in PERA. You can set aside up to Php 100,000 every year. If you’re an OFW, you’re allowed to double your savings to Php 200,000 yearly.

PERA is a good way to save for retirement, as it allows tax-free withdrawal when you reach the age of 55. It provides a generous tax exemption on investment income, which helps increase one’s retirement fund.

How to start investing in PERA:

Open an account with an administrator (either BDO or BPI) by visiting its branch.

Submit the PERA requirements such as valid IDs, income tax return, a deposit account with the bank, and your payment for the initial investment.

You’ll be asked to fill out forms to provide your information. After that, your PERA account will be activated.

Learn More: PERA: How to Invest in Personal Equity & Retirement Account

3. Mutual Funds / UITFs

Minimum initial investment: Php 5,000

Estimated fund value after 25 years: Php 1.29 million (with Php 1,000 monthly investment and an average 10% annual return)

Investing in mutual funds and UITFs is an effective method for building a retirement fund.

These instruments have higher long-term growth potential than a bank account and lower risk than the stock market. It involves pooling your funds with those of other investors and investing them in a diverse portfolio of bonds, stocks, money markets, government securities, and other assets.

Mutual fund or UITF investing is also beginner-friendly. A professional fund manager from the mutual fund company or bank handles your portfolio and makes investment decisions on your behalf.

How to start investing in mutual funds:

Visit a mutual fund company’s or broker’s website to open an account. Fill out its online registration form and answer a risk profile assessment questionnaire.

Then submit the required forms and documents to the company’s office or via courier. Once your mutual account fund has been set up, you can start putting funds into it.

How to start investing in UITFs:

Go to the nearest branch of your preferred bank (better if you have an existing deposit account with the bank) and tell the staff that you want to open a UITF account.

You’ll be asked to complete some forms and present requirements such as valid IDs. Fund your UITF account after the bank issues a certificate of participation.

Learn More: How to Invest in Mutual Funds & UITF in the Philippines

4. Blue-Chip Stocks

Minimum initial investment: Php 5,000

Estimated fund value after 25 years: Php 31.3 million (assuming you invest Php 5,000 monthly in a blue chip stock with an average annual return of 20%)

The stock market offers great potential for high returns to both short-term traders and long-term investors. But stock investing can be risky, and profitability is rather unpredictable.

Of course, you want to ensure that you’ll earn substantially from your investment when you retire.

Your best bet is investing in blue chip stocks of well-established companies in the Philippines with impressive historical performance and proven track record of stability and profitability regardless of market conditions.

Also, many blue chip companies pay dividends to their shareholders, which helps increase your retirement savings.

There are 30 blue chip stocks in the Philippine Stock Exchange. But if you have to prioritize a handful of them, consider buying these top five blue chip stocks with an average annual return of 14% to 20% in the last few years:

  • SM Prime Holdings, Inc. (SMPH)
  • Jollibee Foods Corporation (JFC)
  • Megaworld Corporation (MEG)
  • BDO Unibank, Inc. (BDO)
  • Ayala Land, Inc. (ALI)

How to start investing in blue chip stocks:

Go to the website of your chosen stock brokerage company to open an online trading account.

If you’re a client of BDO, BPI, or Metrobank, you may opt to sign up for an account with their respective online trading platforms (BDO Nomura, BPI Trade, or First Metro Sec).

Opening a stock trading account involves submitting accomplished forms and requirements to the stockbroker. Once your account has been set up, you can fund it with your initial investment to start buying stocks.

Learn More: The Definitive Guide to Stock Trading & Investing in the Philippines

5. Real estate

Minimum initial investment: Php 10,000 (buying a foreclosed land)

Estimated fund value after 25 years: Depends on the location, type of property, type of real estate investment, and other factors

The real estate market in the Philippines has been booming over the past 20 years. Prices of residential properties, in particular, continue to rise and are expected to sustain growth in the coming years.

What does this mean to a budding real estate investor? You can gain profits from buying a home and selling it years later at a higher price. The earnings can significantly increase your retirement savings in the long run.

In fact, an investor made over Php 1 million in profits from selling a condo unit in Makati she bought two years ago. Imagine how much more you can earn if you hold a property for a longer time before selling it.

Another way to boost your retirement income in your senior years is to get regular cash flow from renting out a house, apartment, or condo unit, whether on a long-term or short-term lease. It’s a great way to consistently earn passive income before and during your retirement years.

How to start investing in real estate:

Decide on the type of real estate investment you’d want to get into and learn about it as much as you can.

Buying a house for investment entails a lot of research, so take your time finding the ideal location and property that will maximize your profits.

Consider starting small by renting out your idle property on Airbnb, just so you can learn the ropes of real estate investing.

Learn More: How to Invest in Real Estate in the Philippines

15 Useful Tips on How to Build Your Retirement Fund
1. Set your retirement goals and commit to them

Retirement planning involves making serious life-changing decisions. To do it right, begin with setting goals that are specific, measurable, attainable, relevant, and time-bound (SMART).

Incorporate these important things into your retirement goal-setting:

  • Retirement age – Decide first on when you want to retire. Your choice will greatly affect your other retirement goals and how you’ll reach them. Article 287 of the Philippine Labor Code sets the compulsory retirement age at 65, though you can choose to stop earning a living earlier or later.
  • Retirement costs – How much money do you need to retire? Predicting how much savings is enough to sustain your lifestyle until you die is rather tricky. While you can’t do it accurately, you can at least come up with a ballpark figure, so you’ll know how much you should save to afford your retirement comfortably. As a rule of thumb, estimate your annual retirement income by computing 70% to 80% of your current annual income and then multiply it by the number of years you hope to live after retirement.
  • Financial goals – These goals include saving money not just for retirement but also other milestones such as a home or car purchase and your children’s college education. Determine also your goals in terms of increasing your income and paying off your debts. Each financial goal that leads to your retirement must have a target amount and timeframe.
  • Risk tolerance – How much risk is acceptable to you when investing money for retirement? It changes as you age. In your 20s, you can be aggressive in your investments, as you have a longer time to prepare financially for retirement. But as you reach your 50s, it’s practical to go for conservative, low-risk investments that help you preserve your capital until you retire.

Once you’ve laid down your retirement goals, create a concrete action plan to meet them. Be fully committed to your..

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As a full-time freelancer, I like working in coffee shops every once in a while.

Sometimes, you just have to break the monotonous routine of working at home.

And if you have kids at home (we have a toddler and a newborn), getting a break from all the chaos of playing with and taking care of the little rascals is a godsend.

More importantly, working in a conducive environment helps bring out our best work and boost our productivity to the roof.

Coffee shops used to be the remote worker’s (think freelancers, homebased peeps, etc.,) go-to-spot when working outside—however—it can be a hit or miss.

Sometimes you find a true gem of a place complete with all the creature comforts and faster-than-lightning internet.

But these places tend to get packed quickly and you’re back to Google typing “best coffee shops near me” in no time.

So what’s the best place for people like me who wish to work outside and get topnotch working experience?

Answer: Co-working spaces.

What is a co-working space?

The web defines “coworking” as, “The use of an office or other working environments by people who are self-employed or working for different employers, typically so as to share equipment, ideas, and knowledge”

In other words: A place you share with others to get your work done.

How does it work?

If you ever tried renting a desktop computer in your friendly neighborhood computer shop, it’s essentially the same concept.

But instead of hurling projectiles at each other in DOTA 2 (or whichever online game is hot these days) or casually surfing the web, you go to a coworking space to work.

You treat it as your own little corner space to get things done.

And most shared workspaces I’ve seen (and read about) are packed with all the stuff that people like me absolutely want.

What kinds of stuff, you ask?

How about unlimited coffee, for starters?

Add in uber-fast wifi, comfy seats and desks, superb overall ambiance, and better-than-average amenities and you get the perfect working setup that beats regular office cubicles by a long shot.

Some high-end shared office spaces feature beer taps, recreational and multimedia rooms, and even a gym!

It’s like everything you can dream of in a perfect coffee shop and more—minus all its cons (seats aren’t guaranteed, potential excessive noise, the staff sometimes gives you awkward looks if you’ve been hanging out for some time).

Aside from that, the networking potential you’ll have (since you’ll be in a social setting with other people) opens up a ton of possibilities for your work. Perhaps you can snag a new client, get referred by others, meet other freelancers, etc.,

How Coworking spaces started

Its roots go back to the 90’s (the term for it then was “hackerspace”) and essentially operated under the same principles.

Fast-forward to 2005, the first official “co-working space” was launched in San Francisco by a programmer named Brad Neuberg. He found business centers “unsocial” and thought that home offices fell into the trap of negative productivity (perhaps he too found that there were too many distractions at home).

The Hat Factory is considered to be the first dedicated co-working space (co-founded by Neuberg along with 2 others) and the next few years saw the tech industry adopt coworking spaces both in the US and European countries.

Today, WeWork is the largest coworking company based in the US that provides shared workspaces across the globe.

In fact, they recently opened a 4000-sqm facility in Taguig, opening its doors to freelancers, entrepreneurs, start-ups, small and large businesses. A second Philippine branch will open in Makati.

In the last few years, there has been an increase in the number of coworking spaces popping up all across the Philippines.

State of Coworking Spaces in the Philippines

In 2017, Colliers International projected a 10% growth in the coworking space market in the Philippines. Their report, “Mining Millennials: Finding Gold in Co-working Spaces”, found the increasing number of freelancers and online professionals as the main reason for the rise of coworking spaces.

The report identified coworking spaces as the third type of “flexible offices”, along with Serviced Offices and Hosted Service Providers (BPO). While it takes the smallest share, there has been a rapid increase in the number of coworking spaces being opened every year (61% annually per this report).

Why should you work in a coworking space?

Drawing from personal experience, I’d say the number one reason is that it provides freelancers and other professionals a conducive place to concentrate and really focus on their work.

While some might say that working at home is better since it requires zero costs and no time is wasted commuting, they’re being oblivious to the fact that there are more distractions at home. And more distractions almost always guarantees a dip in productivity.

Startups and companies which can run most of their processes remotely will also find great benefit in the “per-use” nature of coworking spaces. They can opt to use it occasionally only and save a ton in operating expenses.

People also use coworking spaces to conduct business meetings, do presentations, client meet-ups, and all sorts of activities that benefit from a more professional setting.

Who works in coworking spaces?

Everyone can visit a coworking space. But the people you’ll find hanging out here most often are:

  • Freelancers

Full-time, part-time, work-from-home, remote worker—basically all types of freelancers from various fields and niches work here.

  • Startups

Up and coming companies who need a place to run and bootstrap their operations.

  • Entrepreneurs

Solopreneurs, internet business owners, and the like.

  • Consultants

Coworking spaces make a great place to meet and discuss business with clients.

  • Remote teams

Coworking spaces provide a venue for teams to huddle and set goals and have meetings to ensure

  • Professionals

Perfect for making presentations or pitches, conduct meetings, etc.,

  • Students

Review, write your thesis, do your homework—this place can be perfect for school work.

What to look for in a coworking space?

Not all coworking spaces were created equal. Some will be fancier. Others, too basic. However, there are a couple of essentials that you should always look out for when checking out a new place. Here’s a quick checklist:

  • Safety and security – Check if it’s around a safe area and if the premises look secured and have proper security personnel.
  • Maintenance – Refers to both technical support (for the wifi and other similar connections) and janitorial duties (for keeping the area clean and well-maintained)
  • Wifi speed – Most will have faster-than-average speeds. Connections should at the very least be 50 Mbps if not higher.
  • Rooms and desks – How do the conference rooms fare in terms of space and comfort? What about the quality of desks and chairs? You’d want to work somewhere really comfy for long hours of work.
  • Overall ambiance – A vital component of a winning coworking space. It’s actually one of the first few things that will draw customers towards the place.
  • Printer and stationery services – Nice to have especially if you need to print hard copies of documents and other paperwork
  • Cafeteria and Pantry – A well-stocked cafeteria complete with a wide selection of beverages and snacks (and meals) is ideal.
  • Parking – It would be nice to have plenty of spaces for customer vehicles. In fact, it could be a deal-breaker for some.
  • Accessibility – Is the place easy to reach? Is it near your location?
  • Back-up power – A guaranteed source of power is ideal and ensures your work won’t get interrupted by power failures
  • Ventilation systems and heating – Is the AC too cold or weak? How’s the overall airflow and temperature of the place?
  • Network signal and strength – It would be sad to turn away from an otherwise great coworking space simply because your mobile phone’s signal is weak. Still, one thing that you should check out.
  • Storage facilities – Do they have lockers or other storage facilities for keeping your valuables? If you’ll be staying for long hours, you’ll probably bring more than the usual amount of stuff so this one’s good to have.
  • Restrooms – Are they clean and well maintained? Are they stocked with the essentials?
  • Overall service – Are the personnel working at the place pleasant and warm to its customers?
Benefits of working in a Coworking space
  • Boosts productivity and creativity
  • Saves on operational costs
  • Great ambiance that is primed for working
  • Flexible
  • Great for building new connections and networks
  • Great for finding new talent
  • Perfect for impromptu meetings and other corporate events
  • Awesome study place for students too
Things to consider when looking for a coworking space

Each of us has our own preferences when it comes to our working environment. Here are a couple of things to keep in mind when checking out a new coworking space.

  • Community

Does the place provide some kind of “community vibe”? If it does, then that can be a great sign. Unless of course you’re a soloist type and don’t really care for that type of stuff. Still, it’s one thing to consider as having a solid community of like-minded individuals can help in boosting your creativity and opens up a lot of opportunities.

  • Pricing

Be mindful of costs. Check out their plans and packages and see if it fits your budget. Aim for a nice balance between price and features. Look for your “must-haves” and try to look for a place that gives you those features without breaking the bank.

  • Atmosphere

How does the place feel overall? When you first saw it, did you get the feeling of excitement of wanting to work there ASAP? Ultimately, the place’s working atmosphere determines if it’s an ideal place to consider or not.

Coworking space pros and cons
Advantages of coworking spaces Disadvantages of coworking spaces
Great for productivity Can be pricey
Excellent for networking potential You’ll have strangers working around you (lack of privacy)
Saves on operational costs (for business owners and companies) Some in-house events might be distracting
Community support Can get crowded and feel too busy
Types of Desks in Coworking Spaces

The actual spot you’ll occupy and work on in coworking spaces are called “desks”. There are 3 types:

  • Hot Desk

Refers to stations or spaces that are available currently (for walk-in customers, for example)

  • Fixed Desk

A desk that you exclusively “own” per your designated time slot.

  • Cabin or Private Office

A dedicated room or space for teams, like a typical office suite

Coworking space pricing

How much should I expect to pay?

Expect to pay anywhere from Php 5,000 and up monthly for a “hot desk”. Fixed or dedicated desks cost more due to exclusivity, adding a few thousand pesos on top of the hot desk price. Private offices rates will vary widely depending on the place, so best to call the place directly for a quote.

Typical one-day pricing for hot desks starts at around Php 350-550 and more, depending on how premium the coworking space is.

The Best Co-working Spaces in the Philippines

And now for the most important section of this article: Our picks for the best and most popular co-working spaces in the Philippines.

We’ve listed them down per area and included key details like location, rate, and operating hours.

Note that the following is listed in no particular order or ranking.

Prices were obtained and online and may not be 100% accurate so please check with the place if you need more info.

Best Coworking Spaces in Quezon City

Where to find the best coworking spots in QC, you ask? Looking at our list, Katips is the place to be thanks to the growing number of coworking spaces within the area.

47 East

Providing top-notch coworking experience since 2012, 47 East is one of the pioneers in the local scene.

Address: #47 Esteban Abada St., Brgy. Loyola Heights Quezon City
Operating Hours: 8AM-8PM
Rate:

  • Daily = Php350
  • Weekly = Php1,500
  • Monthly = Php5,000

Quad Study and Coworking Space

Anyone looking for a quiet and cozy place to work, study, create, or collaborate will find this place right at home.

Address:: 56 Holy Spirit Dr, Quezon City, 1127 Metro Manila
Operating Hours: 12PM-6AM
Rate:

  • Hot desk = Php60/hr, Php400/day, Php6,000/month

Agor’s Co-Working

A serene and relaxing place in Proj. 8 QC for the digital nomad and other folks looking to get work done.

Address: 12 June St, Project 8, Quezon City, 1106 Metro Manila
Operating Hours: 9AM-9PM (Mon-Fri), 10AM-7PM (Sat)
Rate:

  • Lite plan = Php500/month
  • Come-n-Go = Php1500/month
  • Lite = Php2,500/month

The Owlery Workhub

The place boasts of quality coworking and private spaces at prices that won’t break the bank.

Address: 3rd Flr SMRC Bldg, 331 Katipunan Ave, Quezon City, 1108 Metro Manila
Operating Hours: 9AM-12AM (M-Thu), 9AM-6PM (Fri & Sat)
Rate:

  • Hourly rates start @Php100 (P50/succeeding hr)
  • Daily = Php350 (8 hours)
  • Weekly = Php1,200
  • Monthly = Php3,360

Roots Katipunan

The place provides students, digital nomads, entrepreneurs, and freelancers a friendly and lively spot for work and study.

Address: Unit 106, FBR Building, Katipunan Ave, Quezon City, 1108 Metro Manila
Operating Hours: 9:00 am – 2:00 am (M-Fri), 9AM-2AM (Sat), 10AM-7PM (Sun),
Rate:

  • Hourly rates start Php70
  • Daily = Php350 (8 hours)
  • Monthly = Php3,500

The Other Room

This nice little place located in Malingap St. is a perfect venue for intimate gatherings and coworking needs.

Address: 17 Malingap, Diliman, Lungsod Quezon, 1101 Kalakhang Maynila
Operating Hours: 2PM-12AM
Phone: 0927-8413596
Rate:

  • Hourly = Php50
  • Daily = Php350

Racket Room Collective (Sgt. Esguerra branch)

This coworking space near GMA Kamuning MRT offers patrons a nice and accessible place to get stuff done.

Address: Unit 3G, The Symphony Towers, Sgt. Esguerra Ave, Diliman, Quezon City, Philippines
Operating Hours: 8AM-8PM
Phone: 02-3585735
Rate:

  • Daily = Php600
  • Weekly = Php2,400
  • Monthly = Php6,000

Paperwork Coworking QC

Modern-looking and spacious, this shared space in E.Rod boasts lovely interiors and artful vibe.

Address: E Rodriguez Sr. Ave, New Manila, Quezon City, Metro Manila
Operating Hours: 9AM-6PM (M-F)
Phone: (02) 356 7773
Rate: Please contact Paperwork Coworking via their FB page or phone number provided above

CoCa Collab

Anyone looking for a nice little quiet coworking space near V. Luna will surely love this place’s homey atmosphere and affordable rates.

Address: 73 V. Luna Ave, Diliman, Quezon City, Metro Manila
Operating Hours: Please contact them via their official FB page for details
Rate: Hot desk – Php350/day ; Php3,500/month

Diligence Cafe

This place is popular among students and freelancers for its roomy spaces and lively ambiance.

Address: 2F Elizabeth Hall, Katipunan Avenue, Brgy Loyola Heights, Quezon City, Philippines
Operating Hours: 12PM-7AM (M-Sun)
Phone: 0927 775 0502
Rate: Please contact them via their official FB page for details

CoSpace Katipunan

Another coworking space located in Katipunan, this place looks very modern and fresh, perfect to get those creative juices flowing.

Address: 2nd Floor, 299 Katipunan Avenue, Loyola Heights Quezon City, Philippines 1108
Operating Hours: 12PM-12AM (M-Thu, Sat); 10AM-8PM (Fri);
Phone: (02) 745 5250
Rate: Hot desk @Php400/day

Swing Space

The place’s wooden-centric design gives that “nature-loving” vibe. A quiet and cozy place for students and freelancers alike.

Address: Unit 2 Mezzanine, Burgundy Place Condominium, Katipunan Ave, Quezon City, Metro Manila
Operating Hours: 10AM-3AM(M-Sat)
Phone:  0915 881 0717
Rate: Hot desk @Php400/day

Best Coworking spaces in Makati

The financial center of the country caters to some of the finest coworking spaces digital nomads, entrepreneurs, freelancers, and startups will love.

ASpace Philippines

This popular coworking space in Makati is home to a diverse crowd of folks. The place is huge and accommodates up to 250 workers every day.

Address: 110 Legazpi Street, Legazpi Village, Makati, 1229 Kalakhang Maynila
Operating Hours: Open 24 hours (M-F)
Phone: (02) 542 7842
Rate: Please contact them via their official website or FB page for details

Servcorp

This place provides plenty of coworking options for both individuals and companies. This is their Philippine branch, they also have locations scattered across the globe.

Address: 4th Floor, LAV Building, 2119 C.M. Recto Avenue, Barangay 404, Zone 41,, Sampaloc, Manila, 1015 Metro Manila
Operating Hours: 8:30 AM – 5:30 PM (M-F)
Phone: (02) 405 9379
Rate: Php10,000/month (hotdesk)

Warehouse Eight Coworking & Events Space

This place draws plenty of events and workshops thanks to its huge space.

Address: Warehouse 8-A, La Fuerza Plaza 2241 Don Chino Roces, Makati, 1231 Metro Manila
Operating Hours: 8:30 AM – 8:00 PM (M-F); Open 24 hours (Sat-Sun)
Phone: (02) 812 8643
Rate: Hot desk @Php500/day

Acceler8 by UnionSPACE

Accessible and spacious with a nice working ambiance. The place is also great for holding events, seminars, and workshops.

Address: LG, 111 Paseo de Roxas, Legazpi Village, Makati, 1229 Metro Manila 1231 Metro Manila
Operating Hours: 8:00 AM – 7:00 PM (M-F)
Phone: (02) 917 8118
Rate: Hot desk @Php550/day

Bitspace Makati (Brainsparks)

Their glass-walled offices provide the perfect balance of privacy and connectedness. The place is huge and home to freelancers, entrepreneurs, and startups.

Address:  6/F PDCP Bank Centre, Rufino cor. Leviste St., Salcedo Village, Makati, 1227 Metro Manila
Operating Hours: 8:00  AM – 8:00 PM (M-F); 9:00 AM – 6:00 PM (Sat-Sun)
Phone: (02) 892 5464
Rate: Hot desk @Php400/day

Penbrothers

They claim to be the..

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If you think your SSS pension would be enough to sustain you when you retire, you’re waaaay off the realistic estimate.

Here’s the average monthly SSS pension received by retired Filipinos in the last few years:

2010: P3,524
2011: P3,520
2012: P3,707
2013: P3,577
2014: P3,792
2015: P3,780
2016: P3,658

Source: ABS-CBN News

There’s simply no way you can survive monthly with that amount.

GSIS pensioners have it better, in general, though most will say it still isn’t enough for living and medical expenses.

In the US, they have the 401k and IRA—both were created to allow Americans to save easier for retirement. It helps them grow their money with better interest (versus banks) and provides plenty of tax advantages to give their money even more potential to build up.

But did you know that the Philippines have our own version of IRA and 401k? Yes, we do!

Enter: The Personal Equity and Retirement Account (PERA).

PERA is one of the most under-utilized investment/savings/retirement fund-building vehicle that few Pinoys know about.

In this article, we’ll take a look at what it’s all about and shed some light on some of the most important questions surrounding it.  

Contents

What is PERA?

The Personal Equity and Retirement Account (PERA) was officially launched by the BSP in December 2016 as a means for helping Filipinos 18 years old and above to save for retirement.

How does it help you save for retirement, exactly?

Two words: Tax benefits.

Mainly, the income earned by your PERA savings is tax-free. Also, when you reach 55 years old and ready to withdraw your money, it will also be free from tax.  

Personal Equity & Retirement Account (PERA) - YouTube

It also provides Pinoys with another way to invest their money into something that’s considered to have better interest rates than banks.

Recommended: 11 Best Investments under P100K in the Philippines

When was PERA established/signed into law?

Republic Act 9505 or “PERA law” was created in 2008 with the purpose of giving tax benefits to Pinoys when saving for their retirement.

But it took several years before it became operational as the BSP had to set up the necessary framework with other government agencies and market players (banks).

Finally in 2016, the BSP unveiled a fully-operational PERA system that currently works with two of the country’s top banks: BPI and BDO.

Who can open a PERA account?

Any Filipino with a Philippine Tax Identification Number (TIN) can sign up and open a PERA account. Whether you’re employed, self-employed, or have other verifiable means of income, based locally or abroad (OFW) you are allowed to open a PERA account as long as you have a TIN.

Requirements for opening a BDO PERA account:

  • Filipino Citizen
  • 18 years old and above
  • Tax Identification Number (TIN)
  • Attend and complete the required BDO PERA Seminar
  • Have an existing BDO Current/Savings Account
  • Photocopy of 2 valid IDs, and
  • Copy of latest Income Tax Return (ITR) on hand as reference for the following:
    • Employer’s TIN
    • Employer’s Name

Requirements for opening a BPI PERA account:

  • BPI savings or checking account to serve as a settlement account
  • Valid government ID
  • Tax Identification Number (TIN)
  • TIN ID or copy of the Income Tax Return or any document that can validate the TIN
  • 1,000 Pesos – Initial Amount of Investment and exclusive of Fees

Requirements for opening a PERA account if you are an OFW (to be set up by your spouse or child on your behalf):

  • Marriage certificate (spouse)
  • Birth certificate (child)
  • Sworn certification showing proof that spouse/child is opening a PERA account on behalf of the contributor
  • Overseas Employment Certificate
  • Official documents showing proof of income of OFW from the country he/she is working
Benefits of PERA

So what advantages does PERA have over, say, keeping my retirement funds in a bank?

For starters, you can choose where to invest your PERA funds. This opens up potential for your money to earn and grow faster versus keeping it in banks which are known to have an abysmal interest rate.

Money allocated in a PERA account is invested into other popular forms of investment vehicles like stocks, mutual funds, UITF, government securities, and others. This gives you plenty of options for diversifying your investments. Since you’re allowed to open up to 5 PERA per administrator, you can spread out your monies based on your risk-appetite.

Lastly, the tax benefits gained for the money you save in a PERA account is substantial and gives your retirement money that additional boost you’ll need for future expenses:

  • Contributor is entitled to 5% tax credit
  • Employer contributions are allowed and are TAX-EXEMPT
  • Earnings on investment are free from tax
  • Withdrawals and distributions are tax-free (distributions to beneficiaries are free from estate tax as well)
  • PERA assets are protected from the contributor’s creditors
How much can you contribute to your PERA account?

Eligible Filipinos living in the country may contribute up to Php 100,000 annually. OFWs and Pinoys living abroad can contribute double the amount at Php 200,000.

How to open a PERA account

Before anything else, let’s give a quick introduction of the main parties involved in the investment and maintenance of your PERA account:

  • Investor – That would be YOU. The person who wishes to invest his or her monies in a PERA account.
  • PERA Administrator – An entity which has been accredited by the BIR and pre-qualified by a regulatory authority. The SEC, Insurance Commission, and the Bangko Sentral ng Pilipinas are examples).

Currently, there are only two banks accredited to act as PERA administrators: Banco de Oro (BDO) and Bank of the Philippine Islands (BPI).

  • Custodian – Can be identified as either Cash Custodian or Securities Custodian. They’re essentially a separate entity from the bank (PERA admin) whose role is to take custody of funds and assets invested in a PERA account.
  • Product Provider – An institution/entity which provides and sells PERA investment products
  • Investment Manager – Entity (also regulated) who makes the investment decisions and strategies of the investor’s PERA funds.

Step 1. To open a PERA account, you need to visit your administrator of choice (BDO or BPI).

Step 2. You’ll be asked to complete all required documents and provide any necessary information.

Step 3. Once all requirements are submitted, your PERA account will be activated. Instructions for funding, withdrawing, accessing and other information may vary between BDO and BPI so best to ask them directly (or visit their website) for any questions.

Can you open multiple PERA investment accounts?

Yes. You can open up to 5 multiple PERA accounts (but only under one administrator).

What are the available PERA investment products to choose from?

PERA assets may be invested into one or more of the following:

  • Locally traded stocks and other securities
  • Unit investment trust fund (UITF) (balanced funds, equity funds, etc.,)
  • Mutual funds
  • Annuity contracts
  • Insurance products
  • Pre-need pension plan
  • Exchange traded bonds
  • And more (check out the PERA Act of 2008 Implementing Rules and Regulations for a full list of investment options).

Each PERA administrator’s offerings will vary but will mainly revolve around the above offerings.

BDOBPI
BDO PERA Short Term FundBPI PERA Money Market Fund
BDO PERA Bond Index FundBPI PERA Equity Fund
BDO PERA Equity Index FundBPI PERA Corporate Income Fund
BPI PERA Government Fund

Please check BDO and BPI’s official websites for the latest information on their PERA products.

More Frequently Asked Questions on PERA Why was PERA created?

The government wanted to set up a legal and regulatory framework for voluntary personal retirement plans as a means to promote savings mobilization and capital market development, to contribute to long-term fiscal sustainability through the provision of long-term financing and to reduce the need for social pension benefits.

Does PERA work like the 401k and IRA in the US?

In concept, yes, it is similar. Mainly on the tax advantages that you’ll get for saving your money for retirement.

Why is it a good idea to open a PERA account?

It’s a great way of saving money for retirement. You have plenty of options offered in various risk levels under the two current PERA admins (BPI and BDO) for investing your money.

The tax advantages alone are worth it and will prove super useful in avoiding negative growth on your assets. Check out the benefits section above for a list of reasons why PERA is worth looking into.

I’m already 55 years old (or older), can I still open a PERA account?

Absolutely. Note though that you have to have been contributing for at least 5 years in order to take advantage of the tax benefits.

How much can I contribute to PERA?

Up to 100,000 pesos if you’re residing in the Philippines. Pinoys living or working abroad can contribute up to 200,000 pesos per year.

Can I contribute more than the maximum annual limit?

Yes, you can. However, the amount in excess of the annual maximum PERA contribution limit will no longer enjoy the 5% tax credit.

Who can open a PERA?

Any local or overseas Filipino aged 18 years old and above who has a TIN.

I’m below eighteen (18) years old, can I still open my own PERA?

Yes, you may still open a PERA account even if you’re below 18 years old. Just open an account through a guardian.

How to start investing in a PERA?

Visit your preferred bank (BPI or BDO) for a list of their PERA offerings. Check out our “How to open a PERA account” section above for more details.

What PERA investments products can I choose from?

Locally traded stocks and other securities

  • Unit investment trust fund (UITF) (balanced funds, equity funds, etc.,)
  • Mutual funds
  • Annuity contracts
  • Insurance products
  • Pre-need pension plan
  • Exchange traded bonds
How many investment products will I be allowed to invest in?

You are allowed to open up to 5 PERA accounts under one administrator (BDO or BPI).

When will I be allowed to withdraw my PERA contributions?

Distributions (withdrawals) from your PERA account may begin after you reach 55 years old.

You have the option to withdraw funds prior to reaching 55 but you will incur penalties for the early withdrawal. Check with your administrator (bank) for more details.

Are there any risks to investing in PERA?

As with other investment options, yes there are risks.

Investors should always match their goals with the risk they can manage, as invested monies are subject to highs and lows of the market. As such, here are the general risks to be expected from investing in PERA:

  • Reinvestment risk
  • Credit/Default risk
  • Business risk
  • Country risk
  • Foreign exchange risk
  • Market/Price risk
  • Inflation risk
  • Liquidity risk
  • Interest rate ris
How will I receive my PERA funds?

You will be given the option to receive it in lump sum or through a fixed payment schedule (like a pension).

What will happen to my PERA if I (knock on wood) die before maturity (55 years old)?

Funds in your PERA will be distributed to your declared beneficiaries.

Are employers required to contribute to my PERA?

No, but they have the option to do so. If the company offers it as one of its benefits.

Is PERA transferable?

No, it isn’t.

Final thoughts on PERA

They say the hardest part about saving money for the future is having the discipline to not spend it.

PERA’s charm lies in its incentives that reward the individual with tax advantages if they hold off on spending their hard-earned cash. The diversification options are plenty, allowing contributors to pick their preferred combination of investments based on their risk-appetite.

If you’re someone who wants to look beyond the typical strategy of merely stashing your money in the bank, PERA provides a strong alternative. It’s also another way for growing your money if you’re already investing in stocks, mutual funds, UITFs, and other popular investment vehicles.


The post PERA: How to Invest in Personal Equity & Retirement Account appeared first on Grit PH .

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According to the 2018 World Bank report, the Philippines raked in $32.6 billion (₱1.72 trillion) of remittance in 2017, making it the third largest remittance receiving nation in the world that year, with majority of those remittances coming from OFWs.

Perhaps you are a business owner looking for the best way to send money to your remote team in the Philippines?

Or maybe you are an OFW looking for the most convenient way to send money to his or her loved ones in the country?

Then you’ve come to the right place. We’ve rounded up the best money transfer and remittance companies in the Philippines to guide you in making the right choice.

Contents

What is Money Transfer?

Money transfer is the act of transferring money from one place to another.

It can be done electronically and physically and comes in various forms such as:

  • Money order. Making payments using a paper document such as money gram, or a postal check. A payment guarantee from the sender is needed before a money order is released.
  • Electronic funds transfer. Transferring money from one bank account to another.
  • Wire transfer. Refers to an electronic transfer of money from one bank to another via a network.      
What is Remittance?

Remittance is the earnings that an overseas worker sends to his or her home country.

This can be done either through online transfer or mail. Wire methods may also be used to facilitate its transfer. The funds gathered from such transfer contributes to the economy of the receiving country.

Difference between Money transfer & Remittance?


Technically, money transfer and remittance serve the same purpose.

It’s just that the latter specifically refers to funds that get sent to another country while money transfer refers to all cashless modes of payments in general.

Factors to consider when sending money overseas or within the Philippines

There are many factors to consider when sending money overseas or within the Philippines. These are:

  1. Dependability of the Company – Is the remittance company reliable? Make sure they are by checking the company’s license and track record.
  2. Cost of Transaction – If you’re transferring money from the Philippines and vice-versa, consider the current exchange rate. You might also want to look into how much the fee for the remittance or money transfer will be. Don’t forget to check for any hidden charges or possible promos.
  3. Speed of Transaction – How fast would the funds get to your recipient?
  4. Accessibility – Will the location or means of transfer be accessible to the recipient? How convenient would it be for him or her?
  5. Customer Support – It’s also important that the remittance company you’ll use has capable customer service representatives to serve you.
10 Best Remittance Companies for OFWs & Overseas Money Transfers 1. Western Union

Type: Traditional and Online
Maximum Transfer Amount: $5000
Delivery speed: Instant
Transfer methods: Cash pick-up, Direct to Bank, Mobile Transfer
Western Union Rates:

PrincipalFee

$0.00 – $50.00
$13.00

$50.01 – $100
$14.00

$100.01 – $200
$21.00

$200.01 – $300
$27.00

$300.01 – $400
$32.00

$400.01 – $500
$37.00

$500.01 – $750
$42.00

$750.01 – $1,000
$47.00

$1000.01 – $1,250
$55.00

$1,250.01 – $1,500
$60.00

$1500.01 – $1,750
$70.00

$1,750.01 – $2,000
$80.00

$2,000.01 – $2,500
$100.00

$2,500.01 – $3,000
$120.00

Fast, reliable, and convenient, that’s how Western Union describes its service.

In just minutes, your recipients can redeem the money that you’ve sent. Backed up by 145 years of experience, it is guaranteed to be reliable. And with over 500,000+ agent locations around the world, there’s almost always a physical branch near your recipient.

How Western Union works (sending and receiving)

Sending from agent location

  1. Fill out Send Form
  2. Submit completed form with your desired amount to send, together with a valid ID.
  3. Pick up your receipt and let your recipient know the tracking number. This will allow you to check if the payment has been received.

Receiving money at an agent location

  1. Indicate the complete name of the sender, tracking number, and amount sent in the Receive Form.
  2. Claim your money and receipt.
Western Union Pros and Cons    

  Pros

  • Transfer money in an instant.
  • Allows for transfer of funds as low as $1.
  • Available in 200 countries and territories worldwide.
  • Several transfer options available.
  • Proven track record–160 years in the industry.

   Cons

  • High transfer fees compared to others.
  • Maximum transfer amount is only $5,000.
2. MoneyGram

Type: Traditional and Online
Maximum Transfer Amount: $6,000
Delivery speed: 1 day
Transfer methods: Online, Cash Transfer, Agent, Bank Account to Bank Account, International Money Order
MoneyGram Rates: Can be calculated using the “Estimate Your Transfer” tool on the website; computation may also be requested via their Facebook page.

MoneyGram provides money transfer and payment services worldwide with financial inclusion in mind. It has 350,000 agent locations around the globe, and takes pride in its innovative online and mobile platform.

How MoneyGram works?

Sending money via a Moneygram branch

  1. Go to a MoneyGram branch near you.
  2. Indicate the name of the receiver, his or her details, and how much money you are going to send.
  3. Select where you’ll be getting your funds from (i.e. credit card, debit card, or from your bank account).
  4. Submit the completed documents and amount to the agent.

Sending directly to bank accounts

  1. If you are going to send it online, choose the Account Deposit option and send to your desired recipient.
  2. If you are going to send the money in person, go to the MoneyGram location nearest you to process your transfer.
MoneyGram Pros & Cons

Pros

  • 350,000 locations in more than 200 countries and territories around the world.
  • Same-day transfers.
  • Home delivery and cash pickup options.
  • Transfer as low as $1

Cons

  • Can only send a maximum of $6,000 online
  • Fees vary depending on payment type and transfer destination
  • Local exchange rates depend on destination
3. TransferWise

Type: Online
Maximum Transfer Amount: Private individual – $50,000 per day and $250,000 per year; Business – $250,000 per day and $1,000,000 per year
Delivery speed: 0-24 hours
Transfer methods: ACH, bank transfer, debit card, credit card
TransferWise Rates:

PrincipalFee
Up to $135,0000.75% Fee + $ 3.50 USD
Amount over $ 135,000.00 USD0.75% Fee on initial $ 135,000.00 USD, 0.63% on anything over + $ 3.50 USD

TransferWise has been in the market for eight years. It aims to make transferring funds easier by providing an online platform that allows users to send money for very little cost. It has 11 offices and 1,300 employees in 4 continents.

How TransferWise works
  1. Go to their website and create an account – TransferWise.com – or you can also download their mobile app.
  2. Enter the amount you want to send online on the app or via their website.
  3. See calculation.
  4. Provide the transfer details of your recipient.
  5. Transfer funds.
TransferWise Pros & Cons

Pros

  • Can transfer as low as $1
  • Relatively high maximum transfer amount up to $49,999 a day
  • Apps available for Android and iOS
  • Adopts a mid-market exchange rate.
  • No hidden charges.

Cons

  • No physical pickup option.
  • Does not allow transfer of same currencies.
4. WorldRemit

Type: Online
Maximum Transfer Amount: $9,000
Delivery speed: Instant
Transfer methods: Cash pick-up, direct to bank, mobile top-up, mobile transfer
WorldRemit Rates: Fees vary depending on the exchange rate at the time of sending. You can calculate it using the WorldRemit tool.

WorldRemit provides a variety of funds transfer options to the consumer making it easier, faster, and more affordable.

Currently available in 145 countries, users may choose among cash pickup, bank deposit, mobile money, and airtime top-up as your pickup method.

How WorldRemit works
  1. Go to their website – WorldRemit.com
  2. Choose which country you want to send money to.
  3. Choose your preferred pick-up method.
  4. Indicate how much you want to send and the details of the person you will be sending funds to.
  5. Choose your payment method and send.
WorldRemit Pros & Cons:

Pros

  • Allows transfers as low as $1
  • Available in more than 140 countries
  • Has a variety of payment options such as ApplePay, Android Pay, debit or credit card, and bank transfer.
  • Can be used to send money to mobile wallet accounts

Cons

  • Transfer fees increase with the amount you send.
  • Can only send a maximum of $5,000
5. LBC Home

Type: Traditional and Online
Maximum Transfer Amount: Equivalent of ₱99,000 in cash for immediate pick-up; funds amounting to ₱100,000 and above may be processed as well, but will be received in check form. For more details, call 1-855-4PADALA.
Delivery speed: Instant
Transfer methods: LBC Instant Peso Padala, LBC Spend and Swipe, bank deposit, and home delivery.          
LBC Home Rates:

Amount sentFee if paid via bank accountFee if paid via credit card
$99$4.99$4.99
$101 – $200.99$4.99$8.00
$201 – $300.99$4.99$12.00
$301 – $400.99$4.99$15.00
$401 – $500.99$4.99$20.00
$501 – $800.99$4.99$35.00
$801 – $2000.99$4.99$50.00

LBC@HOME was born out of LBC’s effort to provide remittance services to Filipinos abroad.

Users may choose from various transfer methods such as LBC Instant Peso Padala, LBC Spend and Swipe, bank deposit, and home delivery.

How LBC@HOME works
  1. Got to an LBC branch near you and fill out the necessary documents.
  2. Sign up for an account at www.lbchome.com and send funds online.
  3. Transfer funds via calling 1-855-4PADALA. Note: Applicable only to certain locations.
LBC@HOME Pros and Cons

Pros

  • Widely available across the Philippines
  • Sender may choose from a variety of transfer methods

Cons

  • Some payment methods are available only to residents of certain states.
  • Can only transfer funds from the US
6. Remitly

Type: Online
Maximum Transfer Amount: Varies depending on the requirements you are willing submit and the tier you fall under: $2,999 – $18,000 for Tier 1, $6,000 – $36,000 for Tier 2, and $10,000 – $60,000 for Tier 3.
Delivery speed: Instant (Express), Economy (3-5 days)
Transfer methods: Cash Transfer, Online, Bank Account to Bank Account
Remitly Rates:

Fees for when the funds are received in pesos

Send Amount (USD)Express FeeEconomy Fee
$0 – $999.99$3.99$0.00
$1000 or more$0.00$0.00

Fees for when your recipient receives in US Dollars

Send Amount (USD)Express FeeEconomy Fee
$0 – $99.99$9.99$6.99
$100 – $199.99$9.99$6.99
$200 – $299.99$9.99$6.99
$300 – $399.99$11.99$6.99
$400 – $499.99$13.99$6.99
$500 – $599.99$15.99$7.99
$600 – $699.99$17.99$7.99
$700 – $749.99$19.99$7.99
$750 – $799.99$19.99$8.99
$800 – $899.99$21.99$8.99
$900 – $999.99$23.99$8.99
$1000 – $1099.99$25.99$10.99
$1100 – $1199.99$27.99$10.99
$1200 – $1299.99$29.99$10.99
$1300 – $1399.99$31.99$10.99
$1400 – $1499.99$33.99$10.99
$1500 – $1599.99$35.99$12.99
$1600 – $1699.99$37.99$12.99
$1700 – $1799.99$39.99$12.99
$1800 – $1899.99$41.99$12.99
$1900 – $1999.99$43.99$12.99
$2000 – $2099.99$45.99$14.99
$2100 – $2199.99$47.99$14.99
$2200 – $2299.99$49.99$14.99
$2300 – $2399.99$51.99$14.99
$2400 – $2499.99$53.99$14.99
$2500 – $2599.99$55.99$14.99
$2600 – $2699.99$57.99$14.99
$2700 – $2799.99$59.99$14.99
$2800 – $2899.99$61.99$14.99
$2900 – $2999.99$63.99$14.99
$3000 – $3999.99$63.99$17.99
$4000 – $4999.99$63.99$21.99
$5000 – $5999.99$63.99$24.99
$6000 – $6999.99$71.99$27.99
$7000 – $7999.99$77.99$30.99
$8000 – $8999.99$84.99$33.99
$9000 or more$93.99$37.99

Remitly allows users to transfer funds to bank accounts across different parts of the Philippines.

Other receiving options include cash pick-up at partner merchants such as M Lhuillier, Cebuana Lhuillier, SM Malls, and Globe outlets.

How Remitly works
  1. Create an account on their website – Remitly.com
  2. Enter your recipient’s information and the amount you are sending.
  3. If you are paying via bank deposit, provide your recipient’s banking details as well.
  4. Choose your payment method. Pay with your bank account, credit card or debit card.
  5. Confirm your transaction.
  6. Click “Send Money” to complete your transfer.
  7. Check your mobile phone. Remitly will send text updates on your transaction to your phone.
Remitly Pros & Cons

Pros

  • Transferring money can be done in an instant through their app and/or website.
  • Cash pickup option..
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This entry was co-authored by Trish Rodriguez, Marketing Manager at Taxumo, a tax filing platform for freelancers, entrerpeneurs, and self-employed professionals.

Let’s face it. Tax filing should be easy for everyone to do and accomplish. But with the current Philippine tax filing system, it can be a real struggle for entrepreneurs to comply with tax requirements, while running a business.

Otherwise, they risk being run after by the BIR, and having to pay hefty penalties and surcharges.

Fortunately, there is now a way to do the whole process online, and no, it’s not via eBIR Forms. With the latter, you would still have to manually calculate your taxes and input your data entries.

On the other hand, you can opt for Taxumo: an end-to-end online tax solution that automates the whole process so you wouldn’t have to worry about it.

In this article, we dish out the difference of filing taxes manually, versus doing it online with Taxumo. Read on!

Manual BIR Filing Process

The Standard BIR Filing Process involves several steps. If you haven’t registered with the BIR yet, here are the steps to accomplish the BIR registration process.

I. Accomplish the BIR Registration process:

1. Register your Tax Identification Number (TIN).

2. Submit the general registration requirements to your designated BIR-Revenue District Office.

3. Have your BIR Form 0605 stamped by a BIR representative

4. Proceed to a BIR-authorized agent bank to pay for the processing fee, which costs P500.00

5. Go back to your designated BIR-RDO and present the proof of payment, which, in this case, is the BIR form stamped by the bank.  

6. Secure BIR Form 1906, or the Authority to Print Invoices/Receipts (ATP), and also Books of Accounts.

7. Submit the ATP to the attending BIR officer.

8. Secure columnar books and have them stamped by the guard. Skip this step if you are not a mixed-income owner.

9. Submit the 4 Books of Accounts to a BIR-authorized printing press. Go back after the processing time, which may take 5-10 business days.

10. Attend the scheduled taxpayer’s briefing.

11. After attending, you can now secure your Certificate of Registration (COR) or BIR Form 2303.

12. Have your COR stamped by the RDO attending officer. .

The stamping of the COR marks the last step of the grueling manual BIR registration process. That doesn’t end there though. For the actual filing process, here are the steps:

II. Proceed to the BIR Filing Process:

1. Obtain a copy of the BIR Form you opt to pay, which is also available online. You can also get a copy at the BIR-RDO.

2. Fill out the BIR form.

3. Prepare the general requirements. Have the BIR form stamped by an attending officer.

4. Proceed to the BIR-Authorized Agent Bank and submit the duly-filled BIR Form together with the required attachments. Pay the designated amount and processing fee.

5. Secure a copy of the duly stamped and validated form, which will be given to you by the representative. This will serve as your proof of payment.

NOTE: Don’t forget to compile your proof of payment. You will need them later for documentation.

Also Read: 100+ Profitable Small Business Ideas & Opportunities in the Philippines

 eBIR Forms Filing Process

You finally did it—you’ve completed your tax return forms. After spending a good hour figuring out, answering, and double-checking everything, you giddily go to the nearest BIR office to submit your documents and pay your taxes.

After spending a few minutes in line, you finally reach the window. After taking a quick look at your paperwork, the clerk said:

“Mali po yung entry niyo (insert section here) dito, paki-ulit po”

Accurate or not, I’m willing to bet that a similar scenario happens a lot during the course of a regular day at the BIR.

The bottomline is, filling forms the manual way has a higher risk of error.

I should know, I tend to get anxious filling out forms. As if I’m pretty sure I’m gonna get something wrong (happens often, sadly).

To help taxpayers sidestep this dilemma, the BIR came up with a solution that will lessen the risk of mistakes and ensure a higher accuracy in filling out tax returns.

Enter: eBIR Forms

What is eBIR?

In a nutshell, the eBIRForms Package is a computer software made by BIR which Filipinos can use to prepare their taxes. Instead of the manual process of completing forms (which has a high risk of error), the eBIR software allows users to enter their tax data as well as validate, calculate, save, edit, print, and submit their tax returns.

The highlight is the software’s ability to validate the data entered by the user, as it automatically calculates the information provided

Who needs eBIR Forms?

Taxpayers, employers, freelancers, and more—anyone who needs to accomplish their tax returns. The eBIR Form software contains 36 forms which covers all sorts of tax filing needs (see table below).

Here’s a quick list of individuals who need to use eBIR forms:

  • Accredited Tax Agents (ATA)
  • Real estate agents and real estate developers who are one-time transaction taxpayers
  • LGUs (Barangays are an exception)
  • Corporations reporting to the government
  • Accredited principal and secondary receipt/invoices printers
  • Cooperatives belonging to the government
  • People filing for a “No Payment Return” (they fall under business income or mixed income)
  • Registered National Electrification and Local Water Utilities Administration cooperatives

The following can manually file their “No Payment Returns” (exempted from eBIR forms mandate)

  • Senior citizens
  • Persons with disabilities
  • Employees getting income from multiple employers
  • Qualified employees for substituted filing RR 2-98 Sec. 2.83.4, as amended (but chose to file their ITR for the following reasons: foreign travel requirements, loans, scholarship, etc.
eBIR Forms Coverage

The eBIR Forms software includes 36 BIR forms that covers the following regulations: Income Tax Returns, Excise Tax Forms, VAT Forms, Withholding Tax Forms, Documentary Stamp Tax Forms, Percentage Tax Forms, ONETT Forms, and Payment Forms.

Here’s the full list.

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If you need a government-issued I.D, one of the quickest and easiest one to get is the Postal ID.

This article will show you all the stuff you need to know about it and how to get one.

What is a Postal ID?

It’s identification used by the Philippine Postal Corporation to document postal transactions local and abroad.

Where is it used?

The information reflected in it is used to confirm and verify the person’s address and personal information.

Who can apply for a Philippine Postal ID?

Any Filipino currently living in the Philippines or abroad (but was in the country during time of application).

Foreign residents are required to be living in the country at least 6 months prior to application.

What’s different with the new and improved Postal ID?

The security features on the latest Postal ID has been improved. Similar to other recently revamped government-issued IDs, it now boasts of several layers of protection and can even be verified using a smartphone app.    

Key Features of the New Postal ID
  • Card features a security hologram of a mailman that is viewable at various angles
  • All information and biometrics of the ID holder are captured at the postal office only, ensuring all personal information are legit and valid.
  • The new postal IDs are printed at one main location to prevent duplication.
  • Using the Postal ID Verification app, you can scan the embedded QR code (similar to other regular smartphone apps) to verify the cardholder’s identity
  • The Automated Fingerprint Identification System is used to verify the person’s fingerprint by matching it with the one stored in its database
What is the validity of a Postal ID (and for how long)?

The Philippine Postal ID is valid for 3 years for Filipinos.

Foreigners currently residing in the country can use it for one year. For foreigners with Special Retiree Resident Visa, the validity is for 3 years.  

New Postal ID Application Requirements

To apply for the new Postal ID, applicants need to present both an original and xerox copy of the following documents:

  1. Duly accomplished Postal ID Application form
  2. Proof of Identity (provide one of the following)

Should the applicant cannot provide any of the above proof-of-identity requirements, they can instead submit any TWO of the following documents. One should bear the person’s signature and photo:

  • Voter’s ID, Tax ID, Senior Citizen ID, Seaman’s Book, Police Clearance, PRC ID, Philhealth ID, PAGIBIG ID, OWWA ID, NBI Clearance, Integrated Bar of the Philippines ID, Company ID, School ID, Marriage Certificate, Elementary or High School Form 137, Confirmation Certificate, Transcript of Records (College or Post Graduate), Birth Certificate, Baptismal Certificate, BIR ID
  • Proof of Address (provide one of the following)
    • Utility Bill (Electric, Cable, Internet, Landline, etc)
    • Bank Statement
    • School Billing
    • Certified True Copy of Real Estate Tax receipt
    • Certified True Copy of Lease
    • Barangay Certificate of Residency (must be issued 3 months prior application for Postal ID)
Postal ID Requirements for Foreign Residents

Foreign residents who want to apply for a Postal ID will need to bring the following documents:

  1. Duly accomplished Postal ID application form
  2. Proof of Identity
    • Passport (must be issued at least 6 months prior application for Postal ID)
    • The following documents showing proof of stay in the Philippines (must be issued at least 6 months prior application for Postal ID)
      • Special Resident Retiree’s Visa (SRRV)
      • Diplomatic Visa
      • Temporary Resident Visa (TRV)
      • Long Stay Visitor Visa Extension (LSVVE)
      • Alien Certificate of Registration Identity Card
  3. Proof of Address
    • Utility Bill (Electric, Cable, Internet, Landline, etc)
    • Bank Statement
    • School Billing
    • Land, House, or Condo Lease Contract (notarized)
    • Hotel, Transient home, temporary residence certificate (within 3 months of PID application)
    • Statement of Account from Hotel, temporary residence certificate (within 3 months of PID application)
    • Barangay Certificate of Residency temporary residence certificate (within 3 months of PID application)

For renewal or replacement of your Postal ID (w/o changes in biographic data), you need to provide the following:

  • 2 Copies of completed Postal ID application form
  • Basic or Improved Postal ID card

In the event of loss or theft of Postal ID, you can request for a new one by submitting the following:

  • 2 Copies of completed Postal ID application form
  • Notarized Affidavit of Loss
New Postal ID Application Fees

Here are the amounts you need to prepare when applying for a Postal ID.

FeeAmount
Postal ID + Delivery450 pesos
Vat (12%)54 pesos
Total Postal ID Fee504 pesos

For rush requests, the processing fee is 650 pesos.

Note that rush Postal ID requests can only be made on the following post office branches:

  • Manila Central Post Office (Liwasang Bonifacio, Intramuros)
  • Quezon City Central Post Office (NIA Rd., Brgy. Pinyahan, Diliman)
  • Makati Central Post Office (Gil Puyat cor. Ayala Ave., Malugay)
  • Parañaque Central Post Office (Ninoy Aquino Ave., Brgy. La Huerta)
  • Las Piñas Central Post Office (Las Piñas City Hall, Real cor. Pamplona St.)
  • Valenzuela Central Post Office (Valenzuela City Hall, Maysan St.)
How to Apply for a Postal ID (Application Process)

The entire process of Postal ID application is quick and easy and can be summarized into 3 main steps:

  1. Bring and submit all required documents in the post office.
  2. Get a copy of the application form and complete all required fields.
  3. Upon submission of your documents, proceed to the nearest ID capture station so they can take your photo and fingerprint data. Pay all the necessary fees.

That’s all! You just need to wait for 15-20 working days for your new Postal ID to be delivered to your home address.

As mentioned earlier, there’s a rush application option (you can get the ID within the day or next business day) but you have to pay a bit extra.

How to Apply for a Postal ID Online

To be clear, it’s not really an online process per se. You merely have the option to download and complete the Postal ID application form in advance.

Upon downloading the form from here, complete the required fields and visit the nearest Post Office branch to complete the remaining steps (see above).

Postal ID Release and Delivery

Expect to receive your newly minted Postal ID in the following days:

  • Metro Manila – 15 working days
  • Other Major Cities and Municipalities – 20 working days
  • Island Provinces and Remove Barangays – 30 working days
What happens to your old (valid) Postal ID?

Your old ID will be honored as valid until it expires. If you present it before it expires and apply for a new PID, you’ll get a small discount:

Remaining ValidityDiscountTotal (including delivery)
36 months25%P389.20
24-35 months20%P412.16
12-23 months10%P458.08
How to upgrade your old (valid) Postal ID into the new Postal ID card?

You just need to complete a PID application form and bring it to the nearest Post office along with your existing Postal ID.

Should you have any questions about the process you may reach out to PhilPost via the following numbers:

  • 09253212291
  • 09988847629
  • 09175215373
Other Helpful Information:
  • Even with the revamped Postal ID, you still can’t use it as a valid ID when applying for a passport.
  • The Postal ID Privilege Program works like other regular discount cards. You can avail of discounts and promos at any partner merchant when you present your Postal ID. You can check out the full list of partner merchants here
  • You can apply for the new PID at any post office branch

The post How to Apply & Get a Postal ID in the Philippines [Requirements & Fees] appeared first on Grit PH .

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