PhilAm urges Pinoys to invest in other financial instruments

CEBU, Philippines - Taking into account the sustainable growth of the Philippine economy and the recent credit rating upgrade from Fitch Ratings, Filipinos are encouraged to look into other financial instruments that could keep up with the inflation than to put their money in the banks.

PhilAm Life top officials visited Cebu last Friday for the annual leg of the company’s wealth management forum.

Rolan Enriquez, Philam Life Vice President and Director of Agencies for Central and East Visayas, said that an investment-grade status that signifies the capability of the country to pay its debts also means lower interest rates.

He also cited that corporate income has grown twice the average GDP growth, increasing its ability to expand that is fueled by lower interest rates. 

For the last three months, he said that the stock market has achieved 21 record high since the start of the year and breached the 7 000 level after the announcement of the investment upgrade status.

He, however, said that as the Philippine economic growth strongly remains positive for local yields and increased liquidity, declining interest rates will continue to dampen the cost of money.

Given the interest deflation, he said that one should choose investments that offer returns higher than inflation to grow one’s money over time.

“As interest rates continue to decline, it is time to look into financial instruments that would keep up with the inflation and grow your investments at par with your expectations. You need to match investments with your goals,” Enriquez stated.

Though it provides opportunities in other financial areas like equities, he added that solely relying on interest rates particularly in savings accounts could experience a negative impact as interest rates decrease while the economy improves.

He then urged Filipinos to take advantage of the booming economy in the country and advised them to invest in the active equity market for the long term.

“The party is just starting. There are still two more credit rating agencies. There is more potential to come. There is no better time to invest but now,” he said.

With all of the economic development, he also said that it is time to consider investing in equities as equity investments finance long-term financial goals.

Enriquez further noted that PhilAm has developed certain financial solutions that could help them grow their own personal wealth and earn more than their regular bank deposits.

Money Tree is a one-pay investment and life insurance plan that gives policyholders the opportunity to invest in high-performing funds that take advantage of the Philippines’ booming economy.

It also offers life insurance protection to secure your family’s future.

While bank deposits currently earn 2.75 percent or less annually, Enriquez said that Money Tree gives clients a greater advantage with proven growth rates ranging anywhere from 8% to 15% per year.

Family Secure, on the other hand, is a high-value life insurance plan and is one of Philam Life’s newest unit-linked products that enables policyholders to convert actual investments into a retirement fund as they grow older and as priorities change.

Meanwhile, Philam Life President and Chief Executive Officer Rex Mendoza said that people should need to consider to invest with a long-term mindset and to invest only with a stable, solid institution that has a track record of fulfilling promises if they wish to grow their money.

He added that the key towards real wealth management and making intelligent investment decisions is education, citing that a successful investor must have a combination of attitude, industry knowledge, and an investor’s mindset, and access to appropriate financial instruments.

“People often see insurance for what it is and not for what it does. What people need to do is, first, define their financial goals and set aside a chunk of their wealth to fulfill these dreams. You have to make your resources outlast you, and this is what insurance does for you,” Mendoza shared. — (FREEMAN)