The State of Filipino Finances

I always look forward to receiving Sun Life's financial literacy report or the Study of Lifestyles Attitudes and Relationships Financial Literacy Report (SOLAR FLARe), as it pretty much sums up our financial quotient as a country. It also helps that the report is presented in a very easy to comprehend slideshow (much appreciated!).

For the recent SOLAR FLARe, Sun Life interviewed 1,100 respondents from the middle to upper income segments and here are the factoids that struck me:
  • Filipinos are optimistic- 87% expect their financial situation to go up.
  • Filipinos define financial security as having enough savings in the bank (!!)
  • Most Filipinos are confident about how they manage their finances, with 20% claiming to be experts, but only 8% scored above 80% in a basic financial literacy test.
  • The Philippines has a higher rate of insurance penetration than the United States.
I am not surprised with the news on Filipino optimism, after all it seems to be deeply rooted in our psyche. But this time around, the optimism seems to be misplaced because how can you be optimistic about your financial security if you only have your bank savings to fall back on? Talk about blind optimism.

The good news is that more Filipinos are getting themselves financially educated and are looking beyond bank savings. The bad news is, not enough Filipinos are doing so. 

For now, I'd like to focus on the good and contribute to increasing the average by continuing with my personal mission to educate as much of my friends on personal finance and investments.

These are definitely exciting times to be a financial nerd :)


I think, we Filipinos, doesn't really know where to put money aside from banks. I mean, I just knew about investing and stock market when I was 24 and the person who showed me the world of investing is not a pinoy. According to the survey I read few months back, only 500,000+ pinoys are into stock market and only 150k+ are actively trading. That's shocking knowing that we have a lot yuppies, ofws and working people in the Philippines. I'm really glad that there is an increasing interest on financial education nowadays, so yay!
I agree with what PINASforGOOD said. Filipinos don't know where to put money aside from banks. I learned stock investing through a close friend who is working from a stock market brokerage firm.

I am glad that more and more Filipinos are starting to learn personal finance. :)
Jillsabs said…
Personal finance should really be taught in school no? Instead of saving and investing, children are taught to be hyper consumers.

I learned about investing by reading personal finance blogs and columns. Once I paid off my credit card debts, I knew I wanted to invest, but how do I do that? Enter Google.

My first investment was with a variable universal life insurance (VUL) from Sun Life because I read in a flyer that there was such an animal as a life insurance with an investment component. Looking back now, I was definitely better off with term insurance, but what's done is done and I have long diversified my portfolio to include mutual funds and stocks.
Anonymous said…
hi im also interested in the stock market but dont know how to start some people says the stock market is tricky and if you dont have enough knowledge you'll end up scratching your head because your money is gone.But im still interested because savings account and time deposits wont give you much in return,can you give me some advice,im a pinoy.
Jillsabs said…
I advise reading up more on investments in general, not just the stock market. Mutual funds are also a good investment and doesn't need the same degree of effort as with stock investing.

That being said, you should know first what your risk appetite is. Mutual funds and the stock market promise high returns, but at the same time it's easy to lose your shirt with those types of investments. So read, read, and read some more so you'll know exactly what it is you're getting yourself and your money into.
Anonymous said…
Well reading is a great idea and a friend of mine told me that i should go to PSE somewhere in makati if im interested in the stock market.There i could find a broker who can answer my querries,but these are all new to me.
Jillsabs said…
You don't need to go to a flesh and blood broker to start investing in the stock market, there are online brokers such as COL Financial (COL) that you can use.

If you're just starting with stock investing, I suggest subscribing to Bo Sanchez' Truly Rich Club (TRC) since he spoonfeeds what stocks to buy and sell. TRC's track record is fairly good too, so as a newbie, you can't go wrong to start learning about stock investing there.

You'll soon find out though that TRC follows COL's fundamental analysis, so if you're already confident enough to let go of Bo's hand, you can just go straight to COL for your buy below and sell prices.

Good luck!
Anonymous said…
Thank you Jillsabs!
Jillsabs said…
You're welcome! :)

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