Month: December 2017

Here’s the truth about applying for a job overseas: before you can set foot in a foreign land, you need to pay for certain fees in order to make the job possible. This includes payment of placement fee.

Placement fee is the amount that either you or the employer has paid to the recruitment agency as a form of compensation for hiring a qualified worker for an overseas job. It usually amounts to equivalent to or less than one-month-worth of salary. This fee is placed in a fund, which can be used to assist an overseas Filipino worker in times of need.

Despite its good intentions, most Filipinos dread the day they have to pay for placement fee. Some agencies prefer “salary deduction” wherein a portion of your salary will be remitted for payment of placement fee. Apparently, not all agencies do that. As a result, Filipinos often borrow money from relatives; hence “utang na loob.” Some would even sell valuable assets like residential lots or farming lands to make up for the fee.

Still, the key here is preparation – and these tips will help you raise enough funds for it (without giving up your home or other valuable assets):

1. Look for something you can sell. 

It could be shirts or shoes you never get to wear or items that are still in mint condition. You can even sell unopened, duplicate items like lotion or shampoo. Believe it or not, some things you don’t need anymore could be valuable to other people, so why not convert it into cash.

The good thing about this is that selling them easier. Take good pictures, provide all the information needed, and then post them on OLX, Facebook, or Instagram to attract potential buyers. The best thing about this is that it is free.

2. Get a side job. 

Aside from selling some of your items, you should also consider getting a side job or do some freelancing to help you raise enough funds. The good thing about this is that you get to work at your own pace and you are only hired on a per-project basis.

You can try freelance writing, English tutor, or data encoding jobs. The pay may not be that high, but it is good enough to add to your placement fee fund. If someone in the family enjoys baking or crafting, then put them into good use by selling products online.

3. Eliminate unnecessary expenses. 

It could be eating out in restaurants (fast-food is considered as eating out), going out every weekend, or coffee trips with your family. Perhaps your spouse enjoys online shopping, which can be considered as unnecessary if the item bought doesn’t come with sense of urgency. The point is there are some expenses that are considered unnecessary because they are something you can postpone.

If you want to save up for your placement fee, then do your best to eliminate spending for unnecessary expenses, regardless of how small the amount is. P1.00 is still P1.00 and it could make a difference if you are saving up for your placement fee.

4. Do not immediately resort to loan. 

If you prefer something quick and instant, then borrowing money could solve your placement fee problems. Still, this equates to debt, which you need to pay for every month.

Therefore, do not immediately borrow money from lenders to avoid incurring penalty or interest charges in case of late payment or inability to pay the loan. This could also affect your chances of getting a loan the next time you apply for more urgent needs because of your history of non-payment. Surely, you don’t want that to happen.

Take note that payment of placement fee will only be done AFTER you signed an employment contract bearing the job you were accepted for. Stay away from recruitment agencies that ask for payment of placement fee the moment you submitted an application form.

Nonetheless, take note of these tips (and make sure you do them) so you don’t have to worry when the time comes and you have to pay for it.

They say Christmas is all about giving. While we want to look at the word, “giving” in a positive way, this word equates to “spending” as well. When you spend, this means you take a portion out of your salary or savings to give something to those who mean a lot to you.

What if we tell you that you can still save a few hundreds (or even thousands) despite the Season of Giving?

Here’s how to do it:

1. Sell some of the things you own. 

Do you have purchased clothes you haven’t even worn? What about the duplicate pasalubongs you’re supposed to send to your family that are sitting in your cabinet? How about items that you were supposed to place inside the balikbayan box but you already forgot?

Save some space and get some cash by selling them. Offer them to your colleagues or sell them online for extra cash this Christmas.

Or another good idea would be to give those extra items as a gift instead. This way, you don’t have to worry about making that trip to the mall, especially on this busy month.

2. Set a budget. 

It may sound like a broken record, but if you really want to save, then you need to make a budget for everything, especially during the Christmas season. Having a budget allows you to control your expenses and set limitations.

Start by listing all of the people you plan to give gifts to (if you can, with your ideal gift). If time permits, shop around to give you an idea how much your ideal gift costs. This allows you to set aside a specific budget for each person.

3. Share a gift with someone. 

Do you have a friend you are closest with? Why not share gifts with them to cut your spending into half. This is a good way to save more since you have someone to share expenses with. Nonetheless, this will only be a good idea if you plan to give gifts to your boss or fellow workers.

4. Always pay in cash. 

This is another must-do rule during Christmas. Using a credit card to pay for your purchases may be convenient, but there is a higher possibility that you won’t be able to pay on time; hence incur interest or penalty fee.

If you want to save more, then paying in cash is the best way to go. Plus, you are more conscious of your spending because you know how much is left in your wallet.

5. Consider getting a sideline. 

Christmas is a busy season for everyone. Why not take advantage of it by offering your services for a fee?

Ask around and see if there are any temporary job openings, say in a mall or restaurant. You can also ask your employer for extra jobs for additional earnings.

If you prefer staying in your place, then you can try answering surveys or complete online reviews. There are tons of websites that offer this type of service where you can be paid. This is good enough to give you something extra for the holidays.

6. Try online shopping with cashback services. 

This is popular these days. Cashback sites are websites that partner with online retailers where you get a “money back” for every purchase made on that particular retailer site. The higher the purchase, the higher the cash back will be, which you can use on your next purchase or even have it encashed by crediting it in your bank account.

Still, don’t use this as an excuse to shop and go beyond your budget. You’re after saving and not spending.

More importantly, practice self-control. Gift-giving is not measured by how expensive an item is. What matters most if that you remembered that person and you give something that s/he will appreciate. After all, that’s what Christmas is about, right?

Are you planning to work overseas? Before you dream of seeking greener pastures, the first thing you need to look for is a recruitment agency that will make your dreams come true.

By definition, a recruitment agency is a company that engages in finding suitable and qualified workers for other companies or organizations, both in the Philippines or overseas.

Recruitment agencies are everywhere. Because of the increasing demand for jobs and the money that comes with it, some people are taking advantage of the trend and promise to offer people jobs, only to realize that there are no jobs waiting for them. Worse, you paid for corresponding fees and can’t get your money back.

To avoid this from happening, here are some tips to remember when choosing a recruitment agency:

Tip No. 1: Always check the legitimacy of a recruitment agency. 

This is the first thing you need to check before submitting an application form. While the job offer looks tempting, you’ll never know if it comes from a legitimate agency; hence checking their status is a must.

Don’t rely on the POEA license number posted in their offices. You can check them out in the POEA website to make sure that you apply in a legitimate recruitment agency.

NOTE: Internet-based recruitment agencies are a big NO-NO and are currently tracked by POEA. Do not apply with them.

Tip No. 2: Do a background check of the agency. 

The good news is the recruitment agency is licensed and legitimate. Does this mean they are good? Not exactly.

You need to do a background check on the recruitment agency as well. Find out about the agency’s history, officers, number of workers deployed, and other types of services they offer to help OFWs. If the agency has awards or recognitions, then much better because it only shows the kind of service they offer. If possible, ask about the experiences from previous workers. This way, you will have an idea of what your experience would be like when you apply.

Since you’re already in the process of applying, pay attention to how the agency employees treat their clients. Make sure they are respectful enough in dealing with people since they will do the same with you.

Tip No. 3: Stop when payment is asked. 

Eventually, you will have to pay a placement fee and other documentation costs, which is often deducted on your first monthly salary. If a recruitment agency, no matter how legitimate they are, asked for payment of placement fee upfront, then you need to withdraw your application.

Take note that you are only required to pay upon signing of employment contract, which must be evidenced by official receipts as proof that payment was made. Before that, you should not pay the agency a single centavo.

READ: Prohibited Acts When Applying for a Job Overseas

Tip No. 4: Pay attention to the documentation. 

Let’s say they didn’t ask for payment of placement fee upfront. Then that’s good news. Still, don’t celebrate yet. There are recruitment agencies who ask workers to sign dubious documents or documents that are difficult to understand, which is also not a good sign.

Therefore, pay attention to the application form, which should only contain questions relevant to your personal information and work experience. If employed, you should be offered working visa and NOT tourist visa since the intention is to work overseas. Aside from punishment fees, there is always a higher risk of deportation – and you don’t want that to happen.

Tip No. 5: Ask recommendations. 

Your friends and family who worked overseas can always provide you with the best information based on their personal experience. If none in the family or your circle of friends have tried working overseas, you can always rely on OFW forums or groups for information about the best recruitment agencies and their personal experiences.

Choosing the right recruitment agency is just the beginning. Make this right and hopefully, everything else will run smoothly.

What is your reason for working overseas? The number one reason would be to provide a better life and future for the family. More than that, you want a secured future, savings account that could save you through the rainy days, and a place you own and can call home. After all, having your own home is a sign of success and makes you a living a proof that anything is possible with “sipag at tiyaga.”

Here’s the challenge: finding not just the right but also the best home for you and your family. You want a home that is not only money’s worth but also a place you can settle down and feel secure.

In case you’re in the lookout, here are some tips you need to remember:

1. Self-assessment is the first step. 

You can’t just buy a house just because you saved up for it already. In buying a house, you need to ask yourself the following questions first to test your readiness:

• Am I ready to buy a new home?
• What is my budget?
• Do I have enough savings or funds to pay for the property?
• Can I afford it or it is best to avail of home loan options?  
• Where is the best place to settle down?

Answering these questions could help you determine whether buying a home is ideal for you.

2. Identify the purpose of your new home. 

“Why do you want to buy a new house?”

This is the question you need a solid answer to in order to determine if buying a house is a wise investment. Is it for the family? Or do you simply want additional income by renting out the property?

Identifying the purpose of your home is essential since this will guide you in choosing the property. Consider essential factors like location, the type of property, features of the home, and price of the house. The surrounding establishments must also be considered, preferably a home near hospital, mall, or schools if you plan to live in that house on a long-term basis. These factors should guide you in choosing a home according to your purpose.

You will be seeing lots of brochures and ads about properties. Take time to browse through them as you scout for your perfect family home. Areas in Cavite and Laguna might be your first choice because of the booming property market, but consider areas in the North like Marilao, Bulacan or Pampanga.

3. Choose a reliable and trustworthy property developer and real estate broker. 

This is a must. There are tons of “rising developers” these days who take advantage of the boom in property development but are unable to meet safety standards. This puts not just your money at risk but also the safety of your family.

Therefore, choose a developer with experience in home building. Take advantage of the Internet and check out the developers’ websites during your spare time. Look into each developer’s background, previous projects, and awards, if any.

Consequently, your real estate broker should be a reliable one. Getting a broker is not required, although this is advisable if you are a first-time homebuyer and you need help in the ins and outs of home-buying. Find someone who is recommended by your friends or family for better reliability. The real estate broker must also be licensed and accredited by your chosen home developer. This way, you are assured that s/he can help you in the process.

4. Assign someone who will represent you during the home-buying process.

This is another important step. Being an OFW means you won’t be in the Philippines most of the time; hence unable to process everything personally.

To make sure everything goes smoothly, assign a representative or Attorney-in-Fact (AIF) who will process on your behalf as evidenced by a Special Power of Attorney or SPA. Since this is a major financial decision, it is best to choose someone you can trust, preferably your spouse or a sibling you can trust. S/he must also be responsible and organized since s/he will be signing documents and keeping receipts and documents of the transaction on your behalf.

In case you weren’t able to execute SPA while you’re still in the Philippines, make sure to have the SPA consularized in the Philippine Embassy in the country where you’re working to make it valid and binding.

READ: What you need to know about Special Power of Attorney

5. Visit the site. 

… and make sure to take lots of pictures along the way.

Do not skip this step. You need to know where you’re “possibly” settling for good, which is why site visit is important since the brochure is different from the actual site. A site visit or ocular will give you a feel of what the neighborhood will feel like. It is best if you can do this while you’re in the Philippines, but your AIF can do it for you. If you can, your family should come too.

6. Establish the payment of the property. 

Your budget plays a crucial role in choosing the property. In fact, it cold make or break everything because even if a particular home met your requirements, you won’t be able to afford it.

Ideally, you should pay for the home in cash and in full so you don’t have to worry about anything anymore. Apparently, this requires a lot of dedication, discipline, and skipped shopping, but possible. On the other hand, you can always turn to banks and other lenders to make the purchase of your home possible.

READ: Home Loan Options for OFWs

7. Reserve the property. 

You finally found the perfect home at the perfect location that fits your budget. Congratulations. To make sure this dream home is possible, reserve the property as soon as you can.

Some developers require a pre-qualifying interview to explain the process and payment terms among others. Once you agreed, you will be asked to sign a Reservation Agreement so you can pay the Reservation Fee. This assures you that the property you chose is reserved for you whatever happens.

Take note that the Reservation Fee is non-refundable, which means you can’t get it back in case you decide not to get it. Nonetheless, the amount will be deducted on your downpayment or total purchase price in case you continued with the purchase.

8. Provide the documentary requirements.

There’s no turning back. At this point, you will be required to submit several documents to process the purchase of your new home. Consequently, these documents will also be forwarded to the bank in case you availed of financing.

Some of the documents include:

• Government-issued IDs with signature
• Birth or Marriage Certificate
• Overseas Employment Contract
• TIN or Tax Identification Number
• Certificate of Employment, preferably original
• Payslip
• Passport with corresponding visa or Seaman’s Book, whichever is applicable
• Proof of Billing
• Original Special Power of Attorney

It is best to provide these documents before you go back overseas. Otherwise, developers and/or lenders require these documents to be consularized, which means these must be authenticated by the Philippine Embassy or Consulate of the country you are working in. Consularized documents come with a seal and red ribbon over it.

First of all, congratulations. Congratulations because after month (or years) of waiting, you finally landed your first contract and you’re off to the greener pastures. Congratulations because finally, you can provide a better life and future for your family. Congratulations because finally, you can embrace better opportunities not just for your family but also for yourself.

Wherever you are, whatever country you are assigned to, your experiences as a Filipino migrant worker will be different from many others like you. Nonetheless, you still need to follow a certain set of rules to make your life overseas worth it:

1. It all starts with a plan. 

Before anything else, you need to set how long you will be working overseas. Are you planning to settle there for good by bringing your family? Or do you want to just work there for 10 years or until you can buy your own house? Wherever you will go, have a plan and inform your family about it.

Also, leave the “bahala na” attitude behind. You need to keep yourself educated about the laws and practices in the country where you’re working. Research about the culture and do’s and don’ts to avoid issues as you start your life in a new land.

2. Set a schedule. 

Aside from the plan, you need to establish your schedule to make your time abroad more worthwhile. Check your working hours and down time, which you can use to either communicate with your family back home or for side jobs (although this is not advisable – yet – since you’re still new in the place).

Also, schedule your trips back home, preferably once a year, especially during Christmas or birthday. If one family member can go there and visit you, then make sure to set that schedule as well.

3. And then, set your monthly budget. 

Now that you are settled and becoming more familiar with the place, the next thing you need to do is to set your budget.

Many OFWs, especially the newbies forget about this. We can’t blame you. Earning in dollars can be tempting, plus you are working overseas where there are many items you can’t find in the Philippines. Still, this is not an excuse to splurge. Setting a budget is imperative because it helps you keep track of where your money is going and at the same time, helps you identify expenses that are no longer necessary.

Consequently, work hand-in-hand with your family when it comes to budgeting. Your family back home should also have a monthly budget that complements your budget to be able to maximize savings and grow your money.

Are you looking for a guide on how to set up your budget for the month? Then make sure you read this post.

4. Pay your debts, one due date at a time. 

Do you have pending financial obligations back home? Then use this opportunity to pay those people you are indebted to. In fact, this should also be included in your plan to avoid losing some of your most priced assets. Consequently, this is a must to avoid further issues when you apply for a bigger loan.

List the loans that you have, including due date, interest, and outstanding balance. This way, it will make it easier for you which loans should be paid off first (preferably the loan with the highest interest rate).

5. Live a simple life – both you and your family. 

This is another issue among OFWs. Instead of living a simple life, many of them give in to their family’s demands and often live a millionaire life while forgetting about savings and retirement. Don’t be one of them. In fact, don’t spoil your family and let them get used to living a life of luxury.

How should you do it? Set limits. Don’t easily give in to your family’s, especially your kids’ requests. It is also important to prioritize your expenses before you splurge on material things that won’t last forever. More importantly, live a simple life. Keep in mind that the OFW life is uncertain. It’s better to be prepared for those uncertainties than keep your family happy by giving in to their non-essential bilins. 

6. Don’t forget about yourself. 

At the end of the day, you matter. Take a break, eat well, get some rest, have fun, and treat yourself once in a while. If you are still single, plan ahead and prepare for your future. If you already have a family, set long term goals for both you and your family.

More importantly, be healthy, Your family is counting on you.

Balikbayan box – that box associated with Filipino culture. As the holiday season starts, hundreds of boxes coming from Filipinos from all over the world are making its way to Philippine soil, with thousands of families eager to open them up.

What exactly is a balikbayan box?  Why has it become a part of Filipino families especially during Christmas?

Balikbayan Box, defined. 

According to the Bureau of Customs, balikbayan box is a pasalubong or a package of personal effects sent by Filipinos either living or working overseas to their families and relatives in the Philippines. The sending of balikbayan box started in the 1980s as a result of the surge of Filipinos working in the United States.

Initially, it was subject to taxes until then President Cory Aquino Executive Order No. 206 declaring the said boxes duty- and tax-free on non-commercial goods up to P10,000. This is in response to the sacrifices and hard work done by Filipino migrant workers and its positive effect on the Philippine economy.

In 2016, the Customs Modernization Act was signed into law by then Pres. Noynoy Aquino thereby increasing the tax ceiling to up to P150,000.

At present, OFWs are allowed to send a box once every six months. There are also more balikbayan boxes sent during September to December because of the Christmas season.

Controversy surrounding balikbayan boxes

It was sometime in 2015 when then Customs Commissioner Albert Lina declared that Customs can open the boxes for inspection since many OFWs are abusing their privileges.

To avoid drawing further flak, the Bureau of Customs issued Customs Memorandum Order 27-2015, which states that balikbayan boxes will be subject to x-ray scanning. In case of suspicious items like firearms and illegal drugs, Customs officials, together with OWWA representative, designated officer of OFW association, apprehending officer, and freight forwarder consolidator, can open the box for inspection. Eventually, this rule was “relaxed” and may be opened in the presence of the recipient of the box or any authorized representative.

At present, senders of balikbayan boxes are required to disclose and paste a detailed list of all the contents of the box. At the same time, purchase receipts for brand-new goods must also be presented. The recipient of the said box must also show that s/he is a relative of the sender.

The good news: this new rule is suspended and will come into effect on March 2018.

Balikbayan box: More than just a box of goodies

Here’s the thing about balikbayan boxes: it’s not always about what’s inside. Sure, you would often fill it with Spam, chocolates, shoes and clothes you bought during sale, lotion, perfume, canned goods, and some of your kids’ bilin for their Christmas gift among many others. If budget permits, you can even send two boxes filled with the same goods.

More than the contents, a balikbayan box becomes the tangible connection between you and your family even if you are miles away. You spend considerable amount of time to carefully pack away the items while giving them a kiss and hug, hoping that these goods would do the same for your family you left back home.

A balikbayan box becomes a symbol of your love, hard work, and sacrifices to be able to provide a better life and future for your family. It is a sign of your thoughtfulness and selflessness because you prioritize your needs first more than yours. As you close your eyes, you would imagine the smile on their faces when they see the things you bought and saved up for.

More importantly, a balikbayan box is a way of  bringing joy and keeping your family happy while hoping that all of the items you carefully chose and pack will be put into good use. After all, you’ll never know what will happen and let the box speak in your behalf while giving all the love your family deserves.

By definition, an Overseas Filipino Worker or OFW is a person who is to be engaged, is engaged, or has been engaged in a remunerated activity in a state of which he or she is not a citizen (land-based worker) or on board a vessels navigating the foreign seas, other than a government ship used for military or non-commercial purposes, or on an installation located offshore or on the high seas (seafarer).

At present, hundreds of thousands of Filipinos are seeking for greener pastures to be able to provide a better life and future for the family. If you are one of them, then you deserve a pat on the back for the sacrifice you are willing to make.

Nonetheless, take note of these prohibited acts as provided for by law:

1. Direct hiring or workers being hired directly by employers for overseas employment is NOT allowed to ensure the best working terms and conditions for all workers. Nonetheless, members of diplomatic corps and international organizations are allowed to hire workers directly. Also, name hirees or workers who were able to secure an employment contract on their own is allowed, but you still need to go through POEA for processing of requirements.

2. Travel agencies and sales agencies of airline companies are NOT allowed to recruit workers for overseas employment. Do not course any job application from them. Consequently, recruitment agencies whose license was cancelled or revoked are also not allowed to recruit workers.

3. No fees, including placement fee and documentation costs, must be charged to the worker UNLESS there is already an existing and signed employment contract. Consequently, such fees must be supported by receipts showing the amount paid. If you are asked to pay a specific amount when you apply for a job, then chances are that agency is a scam.

4. Manning agencies shall not charge any fee from seafarer applicants for recruitment and placement services. These expenses shall be shouldered by foreign shipping principals.

5. Collecting money for payment of processing fee of application is NOT allowed.

6. Compulsory and exclusive arrangement with a particular clinic or hospital for medical examination of the applicant-worker is not allowed.

7. Compulsory and exclusive arrangement with a particular lender or financial institution where the applicant-worker can borrow money for loan is also not allowed.

8. Compulsory and exclusive arrangement with a particular training institution, school, entity, or person where applicant-worker is required to attend is also not allowed. Nonetheless, seafarers are allowed to attend recommendatory trainings mandated by principal or shipowners with costs to be shouldered by the employers themselves.

9. Never accept salary that is below the minimum wage prescribed in the host country or in the Philippines, whichever is the highest.

10. The licensed recruitment agency is responsible for the payment of the premium for the compulsory insurance coverage. In fact, this insurance coverage is mandatory, otherwise, no employment certificate will be issued to you. You can learn more about OFW Compulsory Insurance here.

It is imperative that you are vigilant when it comes to applying for a job overseas. Get to know the recruitment agency before you submit your loan application and do not trust them easily. Lastly, check the recruitment agency if it has an existing license to operate through POEA website. It’s better to be safe than sorry.

2017 is about to end. How is your money habits so far? Were you able to save enough for this year? Did you meet your target savings, which you, yourself set as the year started? Or are you back to the same ol’ mistakes?

Don’t worry. You still have few weeks left to change old habits and start a positive attitude towards money. In line with this, here are money habits you need to break – ASAP:

Bad Money Habit No. 1: The “Libre naman dyan” mentality. 

Admit it. Every time you go home from abroad, friends, relatives, and even neighbors you don’t even know ask for you to treat them since you earn in dollars and in local vernacular, “big time ka naman.” While this seems harmless, doing this on a regular basis could affect your savings and financial future without you even noticing it. Plus, you don’t want to be labeled as “kuripot” so you give in to social pressure.

There’s nothing wrong with treating friends and family, but don’t do this on a regular basis or if there is no reason to celebrate. If you prefer to treat to celebrate a milestone, say a birthday or your kid’s graduation, you can still do so, but make sure to set a budget. Keep it simple but meaningful.

Bad Money Habit No. 2: Giving it all to your family. 

What is the most common reason why Filipinos seek greener pastures abroad? It’s all because of opportunity – the opportunity to earn more and the opportunity to provide more for a better life of your family. That is a legitimate reason and you should give yourself a pat on the back for willing to make that sacrifice.

Here comes the problem: when you give all of your hard-earned money to fulfill the “now” for your family. This means you always end up sending a big chunk of your salary back home instead of saving for the rainy days or even setting aside some money for savings.

There’s nothing wrong with this, but make sure you keep a limit. You don’t want everyone in the family to be too dependent on you while you work 24/7. Go ahead and send them money, but make sure you also set aside a portion of your income for savings or Emergency Fund. This is a must.

Bad Money Habit No. 3: The Balikbayan Box syndrome. 

You always have a big box, which you fill with items for every member of the family every time you pass by a store or if you have extra cash. Ideally, you send this once a year, but for you, you send one as soon as you fill up a box, which is usually every few months.

We get it. You want to make up for the time lost. Still, don’t let material things define your love and concern for your family. Material things won’t last forever and by the time you got back home, you wouldn’t even know that what you gave them a year before already made its way on the trask.

Bad Money Habit No. 4: The “Bahala na” attitude. 

You said this several times, including those times when you were in financial trouble. Your faith is something you need to hold on, but don’t let it be the solutions to your problem, especially when you were at fault on why you are experiencing financial issues.

What you can do is to fix your finances and evaluate the areas where you can cut down. This way, you will avoid overspending and leave it up to the Higher One on how this problem will be solved.

Bad Money Habit No. 5: No investment. 

Having a savings account is okay, but it will not be enough, especially if you are aiming for financial freedom. You need to diversify your portfolio, which means you need to consider other modes to grow your money.

What should you do? Invest. In fact, you can still make an investment even with less than P10,000 on your pocket. Before you do, make sure to read up or watch videos about how the stock market or UITF works. Get to know various investment options to help you decide the right tool for you.

Don’t wait for 2018 to start. Break these bad money habits and you are on your way to a better financial future,

Are you thinking of putting up your own business? If yes, then congratulations. You are taking a big leap towards attaining not only financial freedom but also the security and stability of staying in the Philippines for good.

Apparently, putting up your own business is not that easy, especially when you still don’t have enough capital. You can save up for it, but how long will it take for you to meet your required capital? In that case, you can try borrowing money from banks or other private lenders.

Here comes the challenging part: the business plan. Applying for a Business Loan requires you to submit a business plan, which highlights all the details relating to your business. It is important that you take this part seriously because this proposal could make or break the approval of your loan.

Here’s a step-by-step guide on how to do it:

Step 1: Know and define your business concept. 

It all starts with an idea. Then, you turn this idea into something more tangible. At this point, your business plan should define the following – and this should reflect in your business plan:

• Vision and mission of your business
• Your target market and the limitations they experience, which will be augmented by your business
• Product or your solution to the market’s limitations
• Value proposition or your unique selling points
• Branding

Step 2: Get to know your market and industry. 

Most people skip this idea, thinking that the target market is already identified. Apparently, this is a big mistake.

Lenders need to know everything about your proposed business – and this should be based on facts. They need to see that there is really a need for your business as evidenced by facts or studies. Therefore, your business plan must show the following:

• Market research as backed up by personal interviews, surveys, and other forms of discussion from target market, suppliers, and industry experts.
• Growth potential and industry trends based on published studies
• Information about possible competitors (existing business)

Take some time to do this. This will enable you to get to know your chosen field and understand how the industry works.

Step 3: Draft your Business Plan outline. 

Now that you have all the necessary data you need to know about your business, it’s time to draft your business plan outline to keep everything organized.

You should follow the Department of Trade and Industry’s prescribed format:

• Executive Summary – This contains a brief overview of your business, including the nature of the business and the issue it aims to address. You should also include a shot discussion on how applying for a loan could help you grow your business.
• Marketing Plan – Lenders need to know how you plan to market your product and this is what they want to see in this area. Discuss the marketing strategies you will employ to achieve targeted sales, as well as market demographics and analysis of your competitors.
• Production Plan – At this section, you need to outline all aspects of your production process according to your chosen business – from raw materials to equipment, to overhead costs. This way, you can convince the lender that you have the capacity to meet your target sales.
• Organization and Management Plan – This outlines your capabilities, qualifications, and experience to run and manage a business.
• Financial Plan – This section showcases the potential financial strength of your business based on financial strategies and your projections that will prove your capacity to pay off the loan. Make sure you provide details such as loan purpose, loan repayment scheme, forecast of sales and profit, cash flow statement, return on investment, and break-even analysis among others.

Step 4: Add supporting information to back up your business plan. 

It’s not enough that you fill in the details needed in the Business Plan format. To guarantee approval, you must also be able to provide supporting documents that will back up your business plan.

This includes, but not limited to:

• Business permits
• Bank statements
• Contracts pertaining to business, including Lease Contract, Receivables, Purchase Agreement, etc.
• Market research findings
• Background of key employees

Step 5: Review your Business Plan

Congratulations! You finally drafted your Business Plan. The next thing you need to do is to review your plan, make sure that all the important details are included, and there are no errors (including grammar and spelling). They may not seem that important to you, but lenders, especially banks, pay attention to the tiniest detail, so make sure you review and proofread your Business Plan.

Remember that the Business Plan is your proposal to lenders who can help you in making your business in mind happen. Take this seriously to increase your chances of approval.