Save a peso, Gain a future

by: Toastmaster Faye Melegrito

A centavo saved is a peso gained.

Who among you had a piggy bank in your youth, from which you probably attempted to retrieve a coin or two on several occasions? Who had a Kiddie Account in your parents’ banks, for the free stickers and pencils if not the minimal interest? Who moved on to more complex financial portfolios like regular savings accounts, time deposits, stock options?

Who knows the moral of the story of “The Ant and the Grasshopper”? Yes, save for the rainy days. (All summer, the ant stored food while the grasshopper played. Come winter, the ant had lots of food while the grasshopper starved.) What are the rainy days for which we now save?
Our children’s education, that dream vacation, our own house, that incredible car, our own business venture, our retirement years, what else?

Yes, saving can be considered the IN thing, the quest to aim for, the right thing to do if we want to gain something.

Tonight, I share with you a saving technique with an agency usually associated with housing. For the Pag-IBIG Fund is not just the Filipino workers’ partner in housing finance, it is also our partner in provident savings.

WHAT is Pag-IBIG Fund? When it was created 29 years ago, the Home Development Mutual Fund or Pag-IBIG Fund built a provident fund that encouraged the Filipino workers to save a few pesos of their monthly salary, the accumulated savings to be withdrawn upon maturity. Through the years, the Pag-IBIG Fund has grown from a workers’ provident fund to the country’s premier provider of housing finance. Thus, if we are not housing loan borrowers, we may likely complain of our Pag-IBIG deduction upon seeing our payslip. Why do I have to shell-out P100 for my Pag-IBIG contribution, when I don’t even plan on buying a house, you might say. I could have used those hundred pesos for other things, you might even add. But then, it is good to save with Pag-IBIG.

HOW do we save with Pag-IBIG Fund? Those hundred pesos from your salary coupled with another hundred pesos from your employer comprise your monthly contribution. And your monthly contributions are added up to become your total accumulated value or TAV. What’s more, at the end of the year, your TAV is further fattened-up by the annual dividend proportionately credited by the Pag-IBIG Fund to its members’ TAV.

WHY save with Pag-IBIG Fund? When we hear the good news that the Pag-IBIG Fund earns billions a year, we actually experience this good news in the form of dividends. Although it is mandated to set aside annually no less than 70% of its net income as dividends, in 2009 the Pag-IBIG Fund declared P8.5 Billion in dividends, representing 71% of its net income for that year.

Now, you may ask, What do I need my Pag-IBIG Fund TAV for? You might even strongly opine, It doesn’t amount to any substantial value, with two hundred pesos a month, twenty-four hundred pesos a year plus dividend!

I next offer you three ways of looking at your Pag-IBIG contributions, for you to appreciate your TAV all the more.

First, your TAV could be your NEST EGG, if you are an employee.

Think about it, we don’t pay much attention to the hundred pesos deducted from our salary, since we focus our eyes on the net pay. Now, what if we double our contribution, add another hundred or more? Our TAV will then increase double or more, depending on how much we increased our contribution. An additional hundred pesos or more equates to just a combo meal or a restaurant entree. We will hardly feel the added deduction. But we will certainly feel the added gains when we withdraw our TAV upon maturity.

Your TAV fills your wallet when you retire.

Second, your TAV could be your RETIREMENT PACKAGE for your employees, if you are an employer.

Think about it, if you are in business, you likely pay more attention on cutting costs than adding value to your personnel. Now, if you increase your employer counterpart to your employees’ Pag-IBIG contribution to more than the mandated hundred pesos, you will be sending a good message to your workforce. As a result of matching their increased monthly contribution, your employees’ TAV subsequently increases, providing them an ample fund for their retirement years.

Your employees’ TAV will fill their wallet when they retire, and they will surely thank you for their high TAV.

Third, your TAV could be your INVESTMENT, if you are a self-employed professional.

Think about it, you don’t consider Pag-IBIG Fund unless you plan on buying a house. Now, if you’re self-employed, either with your own small enterprise or with your practice as a professional, I invite you to look at Pag-IBIG Fund in a new way. Registering with Pag-IBIG Fund and growing your TAV could be an investment opportunity where you can place a part of your income in sales or professional fees into the Fund, a mutual fund. Remember, your TAV earns dividends each year, dividends which have been increasing every year since Pag-IBIG Fund is performing well.

Your TAV fills your wallet when you harvest the rewards of your passive income.

I now invite you to start looking at the other face of Pag-IBIG Fund, its provident savings feature. The Pag-IBIG Fund remains your partner, both in realizing your dream of homeownership and in saving for a stable future.

By adding a few pesos to your Pag-IBIG Fund TAV, you gain a brighter future. Let Pag-IBIG Fund be your piggy bank in your adulthood.

Save up, save now, and save with Pag-IBIG Fund!