5 Points About Mutual Funds That You Should Know About

life insurance

Is mutual funds investing familiar to you?
Every aspiring young Pinoy millionaire has already encountered this seemingly magical term before: mutual funds.

You know that for you to get financial freedom, saving is not enough. You also need to get started with investing. 

(READ: Investing in Mutual Funds in the Philippines)

Now, you know what investing in mutual funds in the Philippines is like. Your money is pooled together with other investors’ money and this is handled by a professional fund manager who will indirectly invest and make your money work for you.

But, should all your knowledge about mutual fund investing in the Philippines stop here?

Of course not. You need to widen your horizon by loading up on more useful information!

1. 5.5% is the average inflation rate from 1997 to 2011.

Inflation is defined as the rising cost of goods or services.

Think about this: the price of your basic needs such as food increases by 5.5% a year.

Compare this to a bank savings account – even a bank time deposit account – which only gives you around 3% at most, and you can see that you’re on the losing side.

Sure, your money earns money 3% a year, but because of inflation, it also loses its value of 5.5% a year. In the end, the real return of your money is only -2.5%. Lugi ka pa. 

How do you fight inflation? You invest via mutual funds (or variable unit-linked products). 

 

2. P5,000 is the capital that you can start with.

Investing isn’t limited to high-net worth clients only.

Now, you and me can also start investing just by putting in a starting amount of P5,000. (Some companies may have a higher initial capital, but at Sun Life, your P5,000 can already make your money work for you!)

My friend, P5,000 is only around P170/day. Surely you can collect this money in no time, right?

You buy branded coffee or frappuccino priced at P180/day nga, e.  :) In 10 years, that branded coffee can make you fat/unhealthy/obese, whereas if you invested that instead, your investment can already make you happy and wealthy.

 

3. 5 years is the minimum number of years you should hold your investment.

Think of investing as growing a tree.

If it’s still growing, don’t cut it. Don’t stop taking care of it.

Yes, it will take time, but once your tree is fully grown and already bearing fruits, all the time that you’ve spent nurturing it and letting it grow is worth it. In the end, the tree that you’ve cared for will be the one to provide for you.

Investing works the same way.

If you’re still investing, don’t withdraw it yet. Don’t stop consistently adding on to your investment.

As you invest in mutual funds or in VULs, keep in mind that long-term is the way to go. Medium-term such as 5 years is okay, but if you really want to achieve maximum potential of your money, historically speaking, long-term investments in stocks/equities were able to outperform the others investment types.

Bonus incentive: 

Should you choose to invest with Sun Life Financial (through me), you can actually get 0% charges if you invest for beyond 5 years! You can contact me for further details.

 

4. Every 15 days, set aside at least P500 to be invested.

The minimum amount for subsequent investments every month is P1,000, so if you alloted P500 every pay day, you’re all set!

So that you won’t forget this, I would recommend that you use your online bank account.

1. Have a bank account dedicated for investments. Set up automatic fund transfers of P500 every pay day to this account.

2. Then, enroll your investment account in scheduled fund transfer every month.

3. For VUL plans, you can do monthly deposits to your life insurance + investment account by setting up scheduled bills payment too. Just set it and forget it. (Make sure that your account is properly funded, though!)

 

5. Take note of the 5 Cs in choosing your investment company.

As a young Pinoy millionaire, you should be diligent enough to find out which company is best suited to help you meet your investment goals. I personally believe in the power of Sun Life Financial  but you’re definitely free to choose on your own, too.

What are the characteristics that you should look out for? This blog post can help enlighten your mind.

Ready to get started in investing? Act now.

The rich invest in time. Don’t waste any more of it and start inquiring about investment now. The process is as easy as opening your own bank account!

About Lianne Martha Maiquez Laroya

Hi! Thank you for dropping by and visiting YoungPinoyMillionaire.com. I am Lianne Laroya, Licensed Financial Advisor of Sun Life Financial. I'm authorized by the Insurance Commission to act as Insurance Agent and by the Securities and Exchange Commission to act as Investment Solicitor. You can call me at 0906 243 5059 (Phone/Viber) or email me at liannemarthamlaroya@gmail.com or email me at liannemartha.m.laroya@sunlife.com.ph My office is located at 12th Floor, Frabelle Building, 111 Rada St., Makati City. My inspiring network of clients include OFWs, doctors, entrepreneurs and young Pinoy professionals but I serve all members of the society. Most of my clients are based in Metro Manila but I also have clients from Laguna, Pampanga, Bulacan, Pangasinan and Cavite. Want to get FREE Sun Life proposal for yourself? Just click this and submit >>> If you want to open your own investment+income protection+savings account, life insurance, investment account, or you just want to ask something, you can contact Lianne via liannemartha.m.laroya@sunlife.com.ph or text/call her via 0906-243-5059 via mobile/Viber.