Based on my experience, i'm just too lazy to keep a separate account for my savings. What i did back then was to manually deposit my saving to a separate bank account (with a different bank, i should add) with a passbook. I used a passbook account separate from my payroll ATM because I simply don't trust myself not to touch what remains in my atm account.
However doing the actual task of depositing every payday seemed tedious. The bank is literally steps away from my office, yet i'm too lazy to go there in person to deposit my fund. Sometimes the lines at the teller are just too long or i just can't spare a few minutes because i'm way too busy at work. (Yes, i know, there are too many excuses.)
Then i tried opening a separate savings account which i can access via online banking.
Yes, at first, it worked because i no longer have to personally go to the bank to deposit. But i just find it too hard to just leave the money there especially at "petsa de peligro" days - those few days just before the next paycheck, if you know what I mean.
I tried to discipline myself and be responsible, but it was just too easy to transfer money from my designated savings account to my payroll via online.
This left me with zilch amount of savings by the end of the month!
So i thought of some other way for me to easily tuck away my money and yet it would take an effort to withdraw.
In comes the "hidden" wonders of automatic banking.
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| Image from consumerfinance.gov |
Did you know that some banks allow you to "automatically" save and directly invest a portion of your salary regularly?
With BDO (the bank i keep my payroll), that's called EIP or Easy Investment Plan. I arranged with the bank to get P1,000 every payday and invest it in a UITF - Unit Invest Trust Fund. (Disclaimer: I'm not being paid and this is not a sponsored post.)
What do you know... after within a year i was shocked to see that i was able to save and invest Php 24,000 already! I did not have to go to the bank for 24 times to deposit. Also, I did not get tempted to withdraw the funds anymore because i know that the fund is set to grow in time.
An added perk of the BDO EIP is you get to buy investment funds with just Php 1,000 on that specific date, as opposed to Php10,000, which is the minimum top up amount of the UITF that i chose (BDO Equity Fund). Note though, that you only get a COP Certificate of Participation once your top up fund via EIP reaches Php 10,000.
Most experienced investors do away with cost averaging, which is essentially, what i do with EIP, because you buy funds in increments, not in a one time big time approach. You tend to earn more if you do the latter approach. You're more likely to gain more if you invest lump sum amounts.
But then again, i would not have effortlessly invested anything had i not subscribed to an EIP.
Most banks and some mutual funds nowadays allow you to subscribe and redeem funds online already. I know for a fact that the following companies do this:
- BDO - From what i gathered, aside from EIP, the online banking has been upgraded! You can now invest in other types of UITF.
- Sunlife - Open an online account and download that app. You'll learn that you can not only pay your insurance dues there, you can also buy and sell your mutual funds online.
- COL Financial - Buying and selling your stocks is now easy with just a few clicks! Unlike before when you have to contact your broker to give instructions.
Keep in mind, though, that you still have to make an effort and submit all the necessary documents in person or via courier then pay the initial account opening dues before you can access these online services. Once your online account is set up, it's only a matter of clicks for you to setup a system where you regularly pay a certain amount to these companies and have them invest your funds. Most banks with online platform already allows you to automatically pay and transfer funds to these investing platform. When you automate this services, you can surely invest whether you're on vacation mode or is you're just too busy.
I'm just amazed at just how easy it is to save and then invest nowadays! There's really no excuse why one cannot invest.
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4 comments:
I opened a bdo accout then answered the risk profile questionnaire online. I can see the option to subscribe to eip or uitfs but not sure if I have to submit requirements pa sa branch. Would you have an idea?
I opened a BDO savings acct then answered a risk profile questionnaire online in my account. I can see the option to invest already (not eip) but haven't tried. Not sure if I have to submit documents. Would you know?
I opened a Bdo savings account then answered a risk profile questionnaire online. I can see an option to invest in UITF online but have not tried. Do you know if additional docs are required to be submitted to the branch?
Hi Brenda! I agree, this is a great and convenient way to save. This is one thing I want to consider too. Maybe next year.
I'm not sure if you have encountered it, are you familiar with Pag-ibig MP2? It's another great way to invest. I consider this government agency as an underrated yet reliable investment house na din.
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