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Investment Habits of Filipinos

Updated on April 26, 2015
Small businesses like sewing leather wallets in addition to footwear has changed the investment habits of Filipinos in recent years
Small businesses like sewing leather wallets in addition to footwear has changed the investment habits of Filipinos in recent years | Source

An Overview of Filipino Investments

A study of the investment habits of Filipinos show that majority of them are non-investors. They would rather have cash than invest their money elsewhere. Per research made by Manulife, one of the oldest life insurance in the Philippines, around 60 percent of the total fund holdings of Filipinos are in cash. Most Filipinos are risk averse, and prefers to hold on to cash than put their money in investments that could not assure them of a guaranteed income.

Of this 60 percent, only a third is spent on household expenses. The remaining two thirds lays idle to take care of emergencies. However, more than half of Filipinos would be willing to invest their money on ventures that would give them guaranteed income, and the rest are willing to put in their money if said investment could offer a steady stream of earnings.

The Bangko Central of the Philippines (Central Bank of the Philippines), recently released the results from the Consumer Finance Survey (CFS) which showed the investment habits of Filipinos. Most of those surveyed, revealed that they opt to invest their money on household appliances, real estate, and life insurance. Some have investments in motor vehicles, bank time deposit, and jewelries. Only a minuscule percentage owns bonds, stocks, and other financial instruments.

Most locals own their homes, with the rest either co-owned or rented. Acquisition is either through cash, inheritance, or loans. It would be interesting to note that most Filipinos do not have bank deposits or savings accounts. The reason given is that, there is not enough money to save. When money becomes scarce, individuals go to money lenders at usurious rates, even for buying property or equipment. Other sources for housing loan are the government agencies – PAGIBIG (Home Development Mutual Fund), NHA (National Housing Authority), and rural banks.

Foodcart business with low investments of P50,000 have grown in number over the years. This is an investment opportunity for those willing to embark on it.
Foodcart business with low investments of P50,000 have grown in number over the years. This is an investment opportunity for those willing to embark on it. | Source

Investment Habits of Filipinos: Investing with P50,000 and below

Food Cart Franchises

Saying that Filipinos love to eat is an understatement. You find food stalls and kiosk - in malls, groceries, metro rail transits, main thoroughfares, and everywhere. Investment in food carts does not take much money. It can cost to as little as PHP45, 000 inclusive of capital investment for a donut franchise and many others. Other choices for PHP25, 000 is a franchise on: Chinese dumplings, pizza, buko shake, and hamburgers. The package usually includes: trade name and logo, collapsible cart, equipment, uniform, registration, marketing, and product support, among many others.

Bit Coins

Bitcoin trading is a recent development but may be considered as a high return, but high –risk investment. Since it is highly volatile in nature, it is aimed for investors who are prone to go into high risk but high yielding financial instruments -or the risk takers. Bitcoins are popular abroad but demands are still not spiking up in the Philippines. Nonetheless, bitcoin companies started opening up this year so investments for crypto currencies have started in the local markets. As of February 18, the current exchange rate for one bitcoin is PHP28, 028.98.

What is a Bit Coin?

Investment Returns in USD by Compounding - In Percentage

Number of Years
Certificate of Deposit/Bonds
Ave. Stock Market Return
Investing by Trading

Query on Filipino Investment Preferences

What is the Best Investment Opportunity for Filipinos

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More Investment Alternatives for Filipinos at P50,000 and below


Most Filipinos are wary about investing in stocks. They feel that it is the enclave of the rich and the elite. This attitude towards the financial markets, account to a mere one percent of Filipinos investing in the Philippine Stock Exchange. These misconceptions are not making local investors more attuned to the times where they can earn more with stock investments, than putting their money in the banks. Bank deposit interest rates ranges from one to four percent per annum. Stock yields are far more higher than that.

The amount of money that you will invest would depend on the minimum number of shares to be traded. This number is generally fixed and dependent upon the prevailing market price of the stock. The minimum number of stocks that you can buy is 100 shares. So, for stocks selling at say, PHP100 per share, an investor would need to put in is PHP10, 000, exclusive of trading charges. For stocks that fall within the low price range of PHP0.001 to PHP0.0024, the number of shares that you need to buy is 1,000,000 shares. The investor has to put in a minimum of PHP1,000.00 as initial investment.

Mutual Funds

Investments can start with mutual fund which is a pool of money from different investors that are invested in bonds, stocks, and other financial instruments. These funds are managed by fund a manager who is in charge of investing to earn money for his clients. Investing in mutual funds is advisable for investors who do not have enough knowledge or time to monitor his investments. There are many fund companies to choose from and bank managers would be willing to assist if you are interested in this instrument. It is but ironic that the performance of mutual funds in the Philippines has always shown the PSEI as top gainer. What this purports to show is that it is hard to beat the performance of the local bourse, and it would have been better to invest in the PSE directly. Investments in mutual funds can start with as low as PHP5,000.

Common Pitfalls in Investing

  • Doing nothing - would equate to zero monies in the future
  • Starting late - the earlier you start investing the better
  • Investing before paying credit obligations
  • Investing for the short term
  • Turning down free money
  • Playing it safe
  • Playing it scary
  • Viewing lottery tickets as investment
  • Trading in and out of the market

How to Improve Investment Habit of Filipinos

The lifestyle and investment habits of Filipinos are most often out of synch with his earning capacity. Of the most recent survey made by Sun Life of Canada in 2013, Filipinos save inadequately and does not prepare for the future as seen from the mere 20 percent availing of life insurance. Filipinos should have the discipline to invest at least 30 to 40 percent of his earnings on gainful endeavors. You can be an entrepreneur in a small scale business or minimize your expenses if you do not have the aptitude for entrepreneurship. You must also have insurance --- life insurance and educational plan, so everything is taken cared of.

There are investment options that you can avail of to ensure that you have adequate funds when you retire. It is advisable for you to do research and study all the options before deciding to invest. After investing, you need to save the rest of your money through careful planning and budgeting. There is need to stick to your budget and only buy the things that are necessary. You must try to live within your means and avoid debt as possible. Money management should include emergencies to relieve you of the stress of incurring a debt when the unexpected happens. Only through proper cash management, would you be assured that there is money in the future when you need it the most.

Facts About Filipinos Household Saving and Investing


Update: December 26, 2014

Options in High Yielding Investments

The Securities and Exchange Commission oftentimes issue warnings about investing in high yielding instruments. These types of investments can turn out to be scams with promises of: high rates of returns on questionable financial instruments, with an inordinate complexity and secrecy surrounding the investment.

There are many investment options in the market today. The choice would depend on your attitude towards risk and the amount that you are willing to invest. If you are averse to risk, you can choose safe instruments that can give you a steady stream of small income over the long haul. If you are a risk taker, with a large amount of investible funds, and can handle volatile swings in the financial markets, then high yielding instruments may be worth considering.

High yield investments are attractive to most investors; but, at a higher risk. It is sometimes better to play safe and invest in moderate yielding investment plans than aim for the stars and end up losing your shirt in the process. The best choice is to find a high yield investment with low risk, which is most oftentimes --- difficult to find.

To protect your investment, it would be wise to do a thorough study and research before plunging in. A prudent investor should be able to manage his investments well. He must be aware of the factors that affects future returns, and knows how to react when what is expected does not happen..

Some of the high yield investment instruments that you may consider are:

---Convertible bonds

These financial instruments pay interest regularly and can be converted into stocks when stock price increases. Even if you do not convert, the price of the bonds will still follow price increases in the stock market.

---Stock with Dividend Payouts

Investments in blue chip stocks that pay regular dividends are often considered as high yielding. It is a safe investment with an assurance of regular dividend payouts each time.

---Stock Options

Investing in stock options can provide higher earnings than stocks. Options are used as leverage over the stocks. It is easy to buy stock options where the slightest movement can give you high returns.

----Other Options

There are other alternative investment and would include: Certificates of Deposits, and investment in real estate holdings.


Investing is a personal choice. It is geared towards long term goals of reaping rewards. Finding high yielding instruments is not easy. It is advisable for you to know the market well, have a clear understanding of the different financial instruments, and seek the expert advice of professional traders to help your investment grow. When you realize the importance of financial literacy in your life, only then do we say that the investment habits of Filipinos has changed for the better --- and it began with you!

Investing in the Philippines

More About Investments in the Philippines


  • 4 Investment Opportunities for OFW by
  • Getting Ready for the Rainy Day by
  • Tips about Investing in Stocks, Bonds and Mutual Funds by

Other Articles by the author regarding Financial Investments


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    • csmiravite-blogs profile imageAUTHOR

      Consolacion Miravite 

      4 years ago from Philippines

      The Philippines is a poor country where around 70 percent are below the poverty level. It is understandable that savings and investments may be non-existent. But, there is also something wrong with the Filipino psyche --- of being show-offs. even if they can ill-afford them. Every little money that they have are spent on frivolities and non-essential to show off to friends that they have arrived. The young people, specifically in Metro Manila, are now becoming more financially literate --- on the need for savings, insurance, and investments. They are now realizing the folly of our ways, and changing the status quo for a better tomorrow. Thanks for passing by! :)

    • Jean Bakula profile image

      Jean Bakula 

      4 years ago from New Jersey

      It is best if young people get in the habit of saving as soon as they feel secure in their first real job, then the good habits will follow them later in life.

    • csmiravite-blogs profile imageAUTHOR

      Consolacion Miravite 

      4 years ago from Philippines

      We have practically zero investment in the country as the locals tend to blow their money on the most trivial things --- western type houses, high-end cars, latest techie stuff, modern household equipment, etc. --- whenever they are in the country. Many Filipinos work abroad and come home and live like kings. They end up with nothing once their contracts abroad are terminated. Filipinos are basically show-offs and would have lifestyles that are out of sync with their earnings. That is now beginning to change as I see more young people investing in mutual funds, UITFs, and equity stocks. These are not big investors, but young professionals who are now learning on how to save and invest. The US and the West have a healthy outlook on investments and we learned the financial concepts from them. We always look up to the US, Canadian, and Asian bourses to foresee on how the market will go. It is not really for the rich, but maybe for those who have the technical savvy and investible capital , to play around with. Oh, yes you are right! You only play with money that you can afford to lose. So, it is not for the faint of heart. Thanks for passing by!

    • Jean Bakula profile image

      Jean Bakula 

      4 years ago from New Jersey

      This was very informative. In the U.S., people don't save nearly enough money for their futures, they spend money as quickly as they get it, and often live from paycheck to paycheck. Most workplaces have a system where workers can sign up with a firm who handles mutual funds, and that seems to be how most of us deal with saving for the future. But many are also adverse to risk, and put their money in the most conservative things. Here, too, stocks seem to be more for the really rich, or the 1% who hold all the wealth in our country. And banks are paying so little interest, it's not really worth it to put your money in savings accounts, except to keep it aside from your daily needs money so you can keep it safe.

    • csmiravite-blogs profile imageAUTHOR

      Consolacion Miravite 

      4 years ago from Philippines

      The Filipino is basically a show-off and would rather spend on the most up to date gadgets than invest in say, blue chip companies. But, this mindset is changing, as many yuppies are now having financial portfolios of their own.

      For grand old lady

    • csmiravite-blogs profile imageAUTHOR

      Consolacion Miravite 

      4 years ago from Philippines

      I think that attitude is now changing as investments in mutual funds/UITFs and the blue chip companies are on the rise. There is hope for the Filipino! :) For jtrader

    • csmiravite-blogs profile imageAUTHOR

      Consolacion Miravite 

      4 years ago from Philippines

      Nice to see you here arph001. I miss your fishy tales, I hope I can find other sites that you write for. I hope you write more hubs, though, as you are one of the best that I was most fortunate to know. Sorry for the very late reply, but I'll go find that book. I hope they have it on the local bookstores.

    • grand old lady profile image

      Mona Sabalones Gonzalez 

      4 years ago from Philippines

      I saw myself in a lot of what you wrote about habits of Filipinos as investors. This has been very informative and most helpful:).

    • csmiravite-blogs profile imageAUTHOR

      Consolacion Miravite 

      5 years ago from Philippines

      Hi Susan! Nice to see you around! I didn't notice your comment since I have not been looking on my hubs. Thanks much!

    • Susan Recipes profile image


      5 years ago from India

      Thanks for sharing this informative hub. Voted up.

    • csmiravite-blogs profile imageAUTHOR

      Consolacion Miravite 

      5 years ago from Philippines

      If Filipinos can do away with the braggadocio attitude, then that can be the start. A simpler lifestyle and not keep up with the Joneses, will do us a lot of good. @jtrader

    • jtrader profile image


      5 years ago

      Maybe as time passes and people in the country hear more about investment opportunities their habits will change.

    • arph001 profile image

      Phred Phin 

      5 years ago from A Small Fishbowl

      Great Hub!

      Although he writes for a USA audience, I would recommend people who are just beginning to try to handle their finances to read some books by Dave Ramsey. His advice is great for getting and staying out of debt; his investment advice is just okay. (He still assumes 10% average rate of return on stocks, for example.)

    • csmiravite-blogs profile imageAUTHOR

      Consolacion Miravite 

      5 years ago from Philippines

      This is one inherent bad trait of Filipinos, investment is almost nil. There are investment opportunities for a few thousand pesos, but the locals would rather buy the latest gadgets -- cellphones, laptops, and other non-essential items. Even the OFW's who strive hard in foreign shores, would have no compunction in splurging their hard earn monies when they are in the country for a vacation. We need to change the total mindset of the entire population, on the need to be simple and to live within our means. Thanks for the comments! Those are good stats, I hope we get nearer those figures too in the near future.

    • indraprasad v profile image

      Indra prasad v 

      5 years ago from India, Kerala, Thiruvanantha puram

      The saving ratio out of GDP is higher in oil based economies. 11 out of top 15 top saving nations are oil based economies. 3 nations saves higher than 50 % of their GDP- China, Qatar, and Kuwait.China saves $ 4.6 trillion, while USA saves only $ 2.8 trillion (17% 0f GDP). Saving rate of India is about 30%. Saving rate depends the policy decision of countries. Saving rate of China is higher because the rulers encourage it.


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