The past two years have taught us to be more mindful of managing our finances. With the pandemic still going on, our priorities might have changed. 

Before, some of us focused on the present and lived life to the fullest. But, on the flip side, some people are already preparing for the future by saving and investing. Which one are you?

As the pandemic continues, Filipinos are more concerned about their finances than ever. More people are starting to build their savings, plan their retirement, and diversify their income.

For those who already know about investing, this article could help you further understand other investment options you can venture into to diversify your portfolio. Meanwhile, if you’re a beginner, read ‘til the end to help you decide which investment option is right for you.

Here are the top investments for you this 2022: 

Real Estate

Real estate remains one of the most in-demand investments in the Philippines, even during a pandemic.

According to an article, the demand for properties and land continued to grow in the latter part of 2020.

As the population continues to increase, the land, on the other hand, becomes scarce, creating higher demand, resulting in higher prices in the market.

Based on the law of supply and demand, when the supply is low, the demand increases, and so are the prices. This makes land or real estate properties an ideal investment for those who want to reap a rewarding ROI.

There are two (2) ways to earn in real estate investing:

1. Appreciation

The value of a property increases as time passes. 

Several factors affect the property’s value appreciation, and one of them is the location.

If your property is located nearby malls, transport options, and booming business districts, your property becomes more valuable and attractive as the area becomes more developed.

2. Rental Income

Another way to earn money from real estate is through rental income.

If you decide to rent out your property for P10,000 monthly, you’re already earning your passive income without doing anything. 

MP2

MP2 or Modified Pag-IBIG 2 is one of the most beginner-friendly investments offered by the government.

To start, you must be an MP1 member, a common requirement of corporate employees. Meanwhile, you can also apply and register to Pag-IBIG if you are self-employed to pay your dues voluntarily.

The good thing about MP2 is its five-year holding period. It means that you don’t get to withdraw your money for the next five years, making it an ideal medium-term investment.

You’ll also be enticed to invest in MP2 as it is tax-free. For the past ten years, the recorded returns of MP2 members ranged from four (4) to eight (8) percent.

Pag-IBIG recently announced its 5.6% returns for MP2 members this 2022. It already beats the country’s inflation rate, usually around 4%.

If you are a beginner in investing, MP2 is a great way to start, as it is affordable and convenient. You only need P500 pesos to get started and work your way through lump sum, monthly, and yearly contributions.

Learn more about MP2 by visiting Pag-IBIG’s website.

Stock Market

The stock market is one of the most popular traditional investments to date. It is also considered one of the best ways to earn dividends or money as it is a high-risk investment that promises high returns.

As a rule of thumb, if you invest in low to medium-risk assets, you get lower returns than in higher-risk investments.

When you decide to invest in the stock market, you become a co-owner of a company, also known as a shareholder.

Suppose you bought stock from a company that performed and earned well in a particular period. In that case, you also get to earn your percentage from their income, also known as capital appreciation, which is how people make money from stocks.

The ‘buy low, sell high’ principle applies to real estate and stocks. To visualize, for instance, you bought stock worth P10 pesos per share, and the value increased to P15 pesos, and sold it at that price; you already earned an income through capital appreciation.

To start, you can select your stockbroker or the market where you buy and sell stocks. Examples are our local banks like BPI, BDO, Metrobank, etc.

Ginvest

Ginvest is a unique feature of the GCash app. It allows you to invest in mutual funds and UITFs or Unit Trust Investment Fund, a pooled money diversified into various investments instead of picking individual stocks.

This is a beginner-friendly investment suitable for those with a low-risk appetite. Your money is handled by a professional fund manager responsible for buying and selling stocks.

Ginvest allows you to invest in local funds for as low as P50 pesos and P1000 for global funds.

Learn more about Ginvest by vising the GCash app.

Cost Averaging

If you have a low to medium risk appetite and you think that the stock market is not for you, cost averaging is a great way to earn money without the hassle of timing the market.

There is a common saying in stocks that “time in the market is better than timing the market.” Time in the market is used in cost averaging and how it works in general. You just buy stocks whenever you want without watching the timing, which is how things work with the stock market.

If things go wrong, timing the market could potentially cause you more losses than gains. Remember the mantra in investing? “Buy low, sell high”-- this should always be your goal.

With cost averaging, you don’t have to time the market; you just have to be consistent in investing a certain amount.

Learn more about cost averaging here.

Marge

Another beginner-friendly investment is Marge or the Mytrade Affordable Retirement Guide.

It is a platform that gives you monthly recommendations on which stocks to buy and sell, making it a suitable investment for busy people or those just starting.

Instead of picking an individual stock, Marge gives out stock picks or recommendations monthly, which you can use as your guide when buying or selling stocks.

People looking for a long-term investment that is easy to understand can significantly benefit from this. In addition, it is an excellent way to prepare for retirement without the need to dig deeper into the stock market.

Gotrade

Gotrade is a platform where you can buy stocks from US-based companies such as Google, Starbucks, Microsoft, etc., for as low as one dollar or roughly P50 pesos per stock.

The only catch is you have to be wary of the Forex risk or the foreign exchange risk as you have to convert the peso into dollars to buy the stocks you want. Forex risk happens when there is a currency fluctuation causing losses in international financial transactions.

Meanwhile, instead of individual stock picking, a high-risk option for a beginner, you can invest in ETFs or Exchange Traded Funds, a type of pooled investment security that operates like a mutual fund. 

An example of this is VOO or the S&P 500, which are the Top 500 companies in the US.

Dividend Investing and REITs

Dividend investing is similar to the stock market; the only difference is you invest in companies or stocks that give out dividends regularly. 

The best thing about dividend investing is that you get the best of both worlds: capital appreciation and a passive income.

Aside from buying stocks at a low price and selling it at a much higher price, you also get a passive income or dividends without selling anything at all.

Another investment option for beginners is REITs or the Real Estate Investment Trust, a type of dividend investing in stocks. Those saving up for their dream property can benefit from REITs as it does not require a significant amount of capital.

Learn more about REITs here.

The perfect investment that gives out rewarding ROI

Suppose you’re a beginner or a professional who hasn’t decided on the next big financial decision you’re willing to make this year. In that case, we’re here to say that real estate investing is still one of the most reliable ways to grow your money without the risk of losing everything.

If the developer announces a price increase on the units they’re offering, you’re already guaranteed a significant ROI ranging from P200,000 to P500,000, depending on the terms and market conditions.

Kickstart your investment journey

Suppose you’re interested to learn more about real estate investing and properties for sale in Metro Manila. In that case, you may send a private message to Empire East’s Facebook Page or email inquiry@empire-east.com to connect with a professional real estate agent.

You may also visit www.empire-east.com or follow Empire East's social media for more tips and updates.