Friday, June 7, 2019

Financial Wellness 101

Take the red pill or the blue pill. I got handed the red pill. 

Last week I attended this Financial Wellness seminar at work. I heard about it through e-mail and signed up for it. There were a few questions like whether you invest and in what instruments; if you subscribe to a time deposit, UITF, stocks, mutual funds, etc. A few days before the appointed date I got a notification telling us which room to go to. 

On the day itself, it turns out that two banks were presenting their investment options. These were BPI and BDO. Then the room you were assigned to corresponded to the session with a particular bank. In short, they already chose for you. I got sent to the orientation hosted by BPI. 

The "101" in the title should have clued me in as to the sort of content it would have. It was mostly an introduction to how to handle your finances, like prioritising savings over expenses (aka "Pay yourself first") and knowing your risk profile in order to know which investment instruments fit your timeline and capability. 

What's surprising was that I didn't know the place I work in has an investment arm. But even more interesting were the results of the survey we were asked to fill out during the sign up. There were ~70+ respondents. About half already had investments, the other half did not invest. For the investors, the most popular form was insurance. Next was a tie between UITFs/mutual funds and land. Then time deposits, their own business and stocks. 

For the non-investors, the top concern given for not investing is the lack of understanding of what investments are all about. Next, there's a tie between investment being "too expensive" and "too risky." Twenty-five percent said they don't have time. And a good chunk also said they are "afraid of new things." 

Roughly 1% of the PH population invests in stock.
A nice improvement, but we've got a long ways to go. 

The seminar took care of the knowledge gap in investing. A cursory look at the participants and I noticed that (a) they were mostly the office bound employees, (b) a sizeable tito and tita aged contingent but also (c) there were young people, which was heartening. After all, there was this report that the rate of Filipinos putting their money in stocks has gone up with over a million accounts with brokerages, with the bulk of the rise made up of retail investors at 97% and 21% of those are in the 18-29 age bracket. 

Only one guy was willing to admit that he invests in stocks. When asked which stocks he held in his port, he quipped that he already sold his BPI. The investment advisor acknowledged it was the lowest in six years, so it might be a good bargain atm. The guy then said that he also has Jollibee. This then led to the vagaries of stock investing: that it might be affected by issues like Chicken Sad and Endo for Jollibee. But it's still all good if you hold on to your stocks in the long term. 

What he said. 

Which brings us to the key takeaways from the seminar: 
  1. Know your HERO, or Horizon, Experience, Risk Tolerance and Objective. 
  2. Timing does not work but with the current market condition, now is the right time to invest. 
  3. Diversification is important. 
All in all, it's a good introduction to the investing life.  I would have wanted to know more about the various funds offered by the bank, although that's something that could be researched online. They were mostly offering their UITFs. Other options like SaveUp or PERA were off the table. In the end, I got some snacks and freebies by answering their pop quiz and spinning a roulette for some giveaways. All in an afternoon's unpaid non-work. 


George@20somethinglawyer said...

Okay din marketing nila ah, under the guise of a "financial seminar." Madami din yan dito sa Cebu, pero property agents looking to sell condos, under the.guise of "financial advising." I personally prefer if these companies just say outright what they want to lecture me on, so I don't waste my time.

Sera Que said...

Yeah, I would have preferred that they said it outright in the company e-mail that this seminar would be sponsored by Bank A & B and that hey, we will be randomly assigning you to a bank and you can't even choose.

I didn't really need this seminar and would have appreciated maybe a talk on stock investing (sponsored by a broker naman hahaha) or housing that did not rely on those wanting to sell us these things.

But given the turnout and the huge number of replies of "I'm afraid bec I do not understand," mukhang kailangan nga talaga ng mas marami pang financial literacy seminars.