Creating a Savings Plan

Introduction
• Most people around the world do not know how
to deal with money.
• The number of people in serious debt has never
been higher, with many are seriously clueless
about the most basic beneficial knowledge.
• One of the alternatives to face financial
problems is to save money.
• Saving money is neither a science nor an art;
rather it is somewhere in between and requires
your commitment and hard work.
• Saving money takes time to develop, needs to be
learned, and brings benefits that will endure for
the rest of your life.
 Establish a Timeframe
• For example: “I want to buy a house two years
from now”
• Set particular date for accomplishing shorter-
term goals, and make sure the goal is possible
during that time period.
• If it’s not possible, you’ll just get discouraged.
 Figure Out How Much
• Figure out how much you’ll have to save per
week, per month, etc.
• Take each thing you want to save for and figure
out how much you need to start saving now.
• If it is not realistic goal, so adjust your
timeframe until you come up with a possible
amount.
 Keep a Record
• Keep a record of your expenses.
• What you save, how much you make and how
much you spend.
• It is wise to take a critical look at your expenses.
 Make a Budget
• Write down a budget so you’ll know each month
you can spend on. (Ex. “I will only spend
1,000Php a month on movies, chocolates,
coffee, etc)
 Benefits of a Budget
• Will help you live within your means
• Can help you save toward important goals
• Forces you to evaluate and modify your
spending patterns
 Set Saving Goals
• Short-term goals: it is easy. If you want to buy
a laptop, find out how much it cost.
• Long term-goals: it is not so easy, such as
retirement, you’ll need to do a lot more
planning, and you’ll also need to figure out how
investments will help you achieve your goals.
 Building Your Own Budget
• When you are in control of your spending, you
are able to make clear, planned decisions on the
best way to spend your money and make your
money work for you.
 Building Your Own Budget
Step 1. Consider Financial Goals
• Write down long-term and short-term goals
Step 2. Estimate Income
• Think about net income as well as other sources
of income.
Step 3. Estimate Expenses
• Look at previous billing statements
• Take note of fixed and variable expenses
Step 4. Plan for Savings
• Aim to save anywhere from 3 to 9 months
income to cover emergencies
• Further savings should be invested appropriately

Step 5. Develop a Trial Budget

• Fill out what you expect to earn and spend, then
record actual income and expenses.
• Mag-ipon para sa mga bagay na
makakapagpasaya sa iyo at sa pamilya
• Increase income
• Use active income to save and invest
• Make “wants” your inspiration and motivation
to save and invest
 WANT vs NEED
• Want - desire to possess or do; wish for

• Need - necessary
 Poor People Save All the Time
• Life Cycle Events
– Birth; Education; Marriage;
Funeral; Recurrent festivals

• Emergencies
– Sickness; Injury; Theft; Natural
disasters

• Investment
Opportunities
– Business investments; Purchasing
land and other productive assets;
Home improvements
SOSYAL SI BESH SA FB!
Informal Savings Limitations
Not Liquid
Savings in-kind Not Divisible
Subject to Fluctuation

Theft & Destruction

Saving at home Relatives’ demand
Trivial Spending

Community Groups Small scope

Rigid amounts and timing
 Features of savings products
• Security • Appropriate design
• Low transaction cost – Frequent deposits
– Proximity – Small, variable amounts
– Convenient opening – Quick access
hours • Positive returns
– Minimal paper work
 Suggested deposit accounts
• ATM para sa pang-araw-araw na gastusin
• Passbook para sa emergency savings
• Checking account para sa investment
• Joint account kung may asawa o life partner
• Alternative:
– Payroll account or cash card para walang maintaining
balance
 Understanding time deposits
• Hindi gagalawin ang deposit sa
napagkasunduang term
• Para kumita nang mas mataas na interest
• Deposit term: 1 week to >5 years
• Deposit size: PhP1,000 and above
• Could be pre-terminated but usually with fees
• Maaring gamitin bilang collateral – “back to
back” loans
 Suggested use of time deposit

• Emergency fund
• Education fund for children
• Retirement money
 Saan dapat nakalagay ang
emergency fund?

• Savings account with ATM

• Passbook
• Time deposit
• MP2 ng Pag-IBIG
• SSS Flexi Fund for OFWs
• Government treasury bills
• Money market fund or bond fund
Bibilhin ko ba o hindi?
 Tips on Savings
• Save in strong cooperatives – members’ earnings
are tax free in coops
• Save in strong rural banks
– Maintain savings up to 500,000 only to be covered with
PDIC insurance protection
– Place long term time deposits to negotiate for higher
returns
– Time deposits placed for 5 years and 1 day are tax free
– If possible, create a settlement account for interest
earned on time deposits
ACTIVITY: TAMANG
FINANCIAL PRODUCT
 Ano ang tamang financial
product na dapat gamitin?
• Situation 1: Nagkasakit ang 7 taong gulang na
anak ni Maria at Enrique. Kinakailangan nila ng
PhP5,000 para mapagamot ang anak sa ospital.
Insurance Savings Loan
• Situation 2: Isang karpintero si Alex at
sinusuportahan niya ang kayang asawa at 3 anak.
NahulogInsurance Savings
siya sa hagdanan at nabali ang kanyang
paa. Sabi ng mga doktor ay hindi siya
makakapagtrabaho sa loob ng 2 buwan.
 Ano ang tamang financial
product na dapat gamitin?
• Situation 3: May tindahan si Sara na
pinagkukuhanan niya
Insurance ng kanyang panggastos.
Savings Loan
Namatay ang tatay ni Sara dahil sa sakit.
Inaasahang marami ang makikiramay.

• Situation 4: Si Miguel ay isang magsasaka na

Insurance
dumedepende Savings
sa kaniyang ani. Tinamaan ng El
Niño ang kanyang mga pananim. Inaasahang
makakalahati ang kita niya sa anihan.
 Ano ang tamang financial
product na dapat gamitin?
• Situation 5: Si Josephine ay isang single mother
na may kumikitang bakery. Kinakailangan niyang
operahan at kailangan niyang isara ang kanyang
Insurance Savings
bakery sa loob ng 6 na linggo. Sa mga panahong
iyon, kakailanganin niya ng pera upang
ipambayad sa mga bills/bayarin.
• Ang solusyon sa
maraming
problema ay
hindi utang
• Maging laging
handa - kumuha
ng insurance at
sanayin ang pag-
iimpok.
 Suggestions
1. Plant your own vegetables
2. Make a grocery list
3. Plan your spending
4. Keep your coins
5. Budget money for food
6. Divide and Freeze. Buy big cuts or packages
of meat and fish and stretch out over several
meals.
 Suggestions
7. Buy spices and condiments in bulk
8. Shop only once a week. Shop when you have
the energy and aren’t worn out
9. Clean your cupboards and ref once a month
10. Buy non food items at a discount store
11. Even if its on sale, its only a good buy if you
will use it.
12. For Christmas… buy ahead non perishable
items
Thank you for your
kind attention.
Website
www.sedpi.com
Telefax
+632-433-8795
Office Address
Unit 303, Loyola Heights Condominium
23 Dela Rosa Street, Loyola Heights
Quezon City