Author: Lara

Working overseas is not easy. There are lots of uncertainties and you will never know what could happen to you while you’re there. You also need to attend trainings, process documents, and ensure that your family is safe and secure while you are abroad.

Accomplishing many things can be overwhelming, especially before you leave. Don’t worry. These crucial steps, including how to manage finances, will help you prepare before you leave:

1) Complete your travel documents. 

Before you leave, make sure you fill out completely and prepare all your travel documents, including passport and VISA. After all, any mistake not only costs you time but also money since processing fees are doubled.

You might sat that your employer will shoulder the processing costs. Fine. Still, completing all travel documents beforehand saves you against hassle and wasted time.

2) Make sure you have emergency money. 

Many new OFWs are guilty of this: no pocket money.

Keep in mind that when you are deployed to another country to start a new job, you don’t have money or income for at least one month. Even if you received your income after a month, that won’t be enough to help you survive since you might end up sending most of your money back home, coupled with the challenges of establishing your finances abroad.

If you can, save at least two months-worth of salary. This will give you enough buffer as you go through the adjustment period. You may also want to avail of an OFW Loan from Balikbayad to help you as you settle abroad.

3) Establish a budget – and how much money you will send back home. 

Earning in dollars does not always guarantee a good life. To make sure you can live a good life, you need to plan your spending and establish a budget, remittance included.

Before you leave, make sure you research about the cost of living in your country destination. Maximize the information you can find online to help you prepare for the expenses, including food, transportation, and rent (in case accommodation is not included).

Since you are in the process of setting up your budget, make sure to include monthly remittance as well. When it comes to remittances, it is important to establish not only how much money you will send back home but also the remittance provider you will use that will give you more savings.

Check this post to know more about remittance tips. 

4) Take care of your existing financial obligations. 

Did you borrow money from a relative? Did you apply for a loan to pay off your child’s tuition fee? Whatever financial obligations you have, make sure to do your best to pay them off before you leave. This will save you and your family against financial distress too.

Short in cash? Then consider getting a loan from private trusted lenders like Balikbayad. You get to enjoy low interest rate too.

5) Setup a bank account in the Philippines. 

This is important. Several banks such as BPI and BDO offer savings account facilities for OFW, which you can also use for remittance purposes. Setting up a bank account allows you to manage your income, transfer money with ease, and even pay bills even if you are thousands of miles away. It’s more convenient too.

Check out this post to learn about the banks that offer Savings Account with Remittance feature.

Keep in mind that preparation goes a long way. Take note of these five tips and you are on your way to a less stressful transition when working overseas.  

This post is intended for the family members of OFWs. 

According to the survey conducted by the Bangko Sentral ng Pilipinas, fewer OFW families save, with 96.6 percent of OFW households relying heavily on remittances. In fact, the money received from abroad are used to pay for basic needs, which showed that the money remitted to them are their main source of cash.

This could be dangerous, especially when you look into the long-term aspect. Being an Overseas Filipino Worker, although yields higher income, is still full of uncertainty. This is why the BSP recommended putting money in the banks since remittances not only  fuels domestic consumption but also helps finance other productive sectors in the economy.

How can you do that? Here’s how:

1) Start by discussing the Family Dynamics. 

This is the first step you need to do as a family. Schedule one day so you can sit down as a family and discuss how to handle the money you will receive from the OFW member. You already have an idea how much money your OFW member is making, so agree on how much money you will receive, how much will be alloted for savings, and who else can contribute to augment the daily needs of the family. Abled members must also work and not just rely on the remittances.

By doing this, you are not only helping your OFW member in financing the family’s needs but also being sensitive about his/her personal needs as well.

2) Look for alternative ways to earn money. 

Every OFW family, no matter how big the OFW is earning, must not rely on the family member working abroad alone. Since you already discussed and laid down rules on what to do as a family, look for opportunities that allow you to grow money.

You can open a sari-sari store or engage in buy-and-sell of goods like clothes or toys. If anyone in the family has a special skill, say baking or crafting, use it as an opportunity to earn money. There are many options. Be creative and think of ways on how to help.

3) Budgeting is key. 

You already agreed as to how much you should get every month. At this point, you already identified what you can do to increase your cash flow. The next step is to set a budget.

Every month, set aside portion of the remitted money plus other cash sources to basic needs – utilities, grocery, allowances, and savings. Consider tracking all expenses, no matter how small the amount is, so you will know where to cut down. Building a realistic budget doesn’t happen overnight, so make sure you do this religiously.

4) Discuss the future. 

Being an OFW is not forever. At some point, the OFW member in the family will come home and realize that there are limited opportunities for him/her abroad. Before that happens, make sure you established your future plans as a family.

There is not perfect formula when discussing your future plans. It could involve a new house, new car, P1 million in the bank account, or a sustainable business, whatever depends on the family.

Keep in mind that achieving financial freedom as a family is a team effort. One cannot drive a car without gas in it. Help the OFW member in the family by doing the tips enumerated above and you will worry less about the future in no time.

The qualities of a good borrower was discussed in a separate post. Now that you know the qualities you should possess and to eventually increase your chances of getting a loan approval, it’s time to say hello to the qualities a good – if not great – lender should possess.

This includes the following:

1) Has Sufficient Lending Limit 

Imagine this: you are in the middle of expanding your mini-grocery business and you need enough working capital to make this work. When you go to your lender, they tell you that they cannot accommodate your loan because they don;’t have sufficient funds. It’s a bad sign, don’t you think?

Therefore, make sure you go for someone who is stable and willing to lend a higher amount. Otherwise, time to move on to another lender.

2) Flexible 

Banks and other lending companies follow specific guidelines prescribed by the Bangko Sentral ng Pilipinas. In fact, they are subjected to regular audit to make sure they comply with the requirements.

Still, go for a lender that can provide flexibility in financing terms. They should be able to offer you terms that are within your capability without breaking any rule, whether lowering your interest rate or extending the maturity of your loan by one month.

3) Responsive

Bank terms can be intimidating and confusing for the laymen. This is why don’t hesitate to ask questions if you cannot understand something. A good lender should be patient enough to explain what the loan is about and every little detail in it. He/she must give you a walk-through of what the loan is about, including benefits and risks. A good lender must be able to answer your concerns, no matter how negative it might be, to help you determine if you are making a right choice. .

4) Unparalleled Reputation 

Are you willing to lend money from someone with negative reviews? Do you want to borrow money from Lender A who was involved in a scam few years ago?

Reputation is important when it comes to choosing the best lender. You want someone who is reliable, trustworthy, and have a positive feedback from other customers.

In addition, make sure to maximize Facebook and other social media channels to check the credibility of the lender you are eyeing for. The good thing abotu social media is that people can easily give their firsthand experience about the service and treatment. This will make it easier to see how other clients were treated and how the loan application was also processed.

5) Experience 

Apart from reputation and credibility, the lender’s track record or experience is also crucial in determining whether a lender is good or not.

By experience, this means a lender must be in the industry for years, knows the in and out of loans, and equipped with necessary and sufficient knowledge to address your needs. After all, the more experienced a lender is, the better it will be for the lender to handle your financial needs.

6) Partner and Not Just a Lender

Lenders often think highly of themselves because of their abilities and skills. This is not a good sign because a good lender must see themselves as your strategic partner. Aside from helping you find financial means, a good lender also provides management assistance that could further improve your business. They should offer services that allows you to deepen your knowledge and grow your money. After all, having a sustainable and self-sufficient business will benefit you a lot since you don’t have to work overseas.

With these qualities in mind, is your lender a good one?

The life of an Overseas Filipino Worker is full of uncertainties. Despite the existing contract, there is a possibility that it won’t be renewed or your contract will be cut short due to unforeseen circumstances. In case this happens, how prepared are you and your family?

The good news is preparation could help you a lot to help you get back up on your feet in case the unimaginable happened. It may be difficult at first, but here’s what you can do:

1) Set up an emergency fund. 

Being financially prepared is a must, especially with your line of work. One of the things you can do to help you prepare financially is to set up an emergency fund for the family.

From the name itself, an emergency fund is something you can use during unforeseen circumstances. It could be sudden death, illness, and in this case, loss of employment. This fund can help you cover basic expenses such as utilities and food. Ideally, your emergency fund should help you last at least three to six months until you are able to find a new job.

You can read this post to know more about emergency fund with tips on how to set it up.

2) Always have a plan. 

Surely, you can’t work overseas for the rest of your life. You still want to get old in the Philippines and having a plan can help you with that.

What does this mean?

Think about the future. Think about the things you can do once your contract expires. It can be opening a sari-sari store, your own tricycle business or driving your own taxi. Consider buying a small property or a condominium unit and have it leased. The bottom line is have a Plan B and start working on it while your contract is still in force.

3) Invest early. 

Having a savings account is a good start in establishing your financial stability. Still, don’t limit yourself with your savings account.

While you still can, explore other investment opportunities such as mutual fund, UITF, or stocks. These investment options yield higher return than savings account, thereby giving you sufficient buffer in case your contract was not renewed.

Check this post to know more about your investment options.

4) Look for other income opportunities. 

So you were sent home because your destination country is going through political crisis. Even if the government gave financial aid, the amount will not be enough to help you last a month. What should you do next? ‘

Don’t be afraid to look for other opportunities. You can always apply again, but it will take months before your deployment. Or you can look for other jobs in the meantime to help you get by. The salary may not be as big as what you are earning abroad, but it will be enough to sustain your family’s needs while waiting for another opportunity.

5) Train your family early on. 

Admit it. Most of your salary is dedicated for your family. Aside from the monthly remittance, you have to fill up a balikbayan box with your family’s bilin. 

Cut the habit and train your family to live a simple life. Do not give in to their demands all the time just to appease them. Keep in mind that your life as an OFW is not forever. You will never know what will happen in the future. You don’t want your kids to get used to a lavish lifestyle, do you?