Two weeks ago at the Ortigas Feast, the series entitled “Happy Healthy Holy Money” was concluded. Bro. Joel together with Mrs. Irma Lasquety, CPA, discussed about the 7 Jar System and ways to invest.
7 Jar System:
Jar 7- Emancipation Fund (20% or more)
This is also called the retirement fund. All of us have to set aside money for our retirement because it is the biggest expense of our lives. Yes, we no longer have to work during this time, but we won’t also have our monthly salary!
I personally wish that our Filipino culture regarding retirement would change. Because right now, a lot of retirees rely solely on their pension, which is only how much? 3,000? 5,000? And, I am saddened by the fact that a number of pensioners are in debt! Their ATM cards are with lending institutions because they have used it as a “pawn” so they could borrow money. Worse, others don’t even have a pension. They rely entirely on their children for their basic necessities – food, shelter, and health care.
I dream of a time when Filipino retirees would just travel abroad, dine out, treat their grandchildren at Jollibee, get the best healthcare and just enjoy the remaining days of their lives!
Retirement is something that we should all prepare for. This is when most of us get weak or sick and we need people to take care of us. Health care would become very expensive, even if we would get Senior Citizen discounts.
So HOW would you fund for your retirement?
There are many ways..
- Get a life insurance. There are a lot of good insurance companies out there. But I have chosen Sunlife. Nowadays, insurance is already customizable – it can come with health care, mutual funds/stocks, accident benefit, critical illness benefit, and more. If you want to know more about insurance, I have a lot of friends in the industry. I can refer you to them.
- Invest in stocks. Like insurance, there are also a lot of good stock brokers out there. My personal choice is Citiseconline. I have written a number of posts regarding that so you can find them here.
- Invest in real estate. You can invest in condos, boarding house, agricultural land, or whatever real estate you please.
- Build your business. Develop your core skills or your talents. Network. Find an opportunity.
I spend about 52% in this jar.
Jar 6 – Emergency Fund (can be 10% per month until it reaches 300% or thrice your monthly salary)
They say that you should have at least 3 times of your monthly salary in your emergency fund. This would be used when you suddenly lose your job or if there is an emergency in the family. You should put this in an instrument that can easily be withdrawn from.
I like BPI because they have this BPI Direct Saving-Up feature wherein you can set up your payroll account to automatically transfer funds to your save-up account monthly. So you never forget to set aside for your emergency fund.
Jar 5 – Everyday Fund (70% or less)
Because I am frugal, my everyday fund is only around 23%. That already includes condo rent, food, transportation, internet/call/text load, and laundry.
Jar 4 – Empower Fund (5% to 10%)
This is supposed to be spent to empower yourself like investing in good clothing, going to the spa, having your hair or nails done at the salon but usually I spend this for my family/friends (gifts).
Jar 3 – Enjoyment Fund (up to 5%)
This can be used for hanging out with your friends, eating out, watching movies, travelling, or buying new gadgets
Jar 2 – Educational Fund (5%)
We should never stop learning. Pursue your hobbies. Enroll in trainings.
I usually spend this in books and attending seminars/talks/workshops/retreats. I also use this fund to buy painting materials.
Jar 1 – Eternity Fund (10%)
Last but definitely not the least is our Eternity Fund. I have been giving to the church regularly but it has never reached 10%. This February, I prayed that I would give 10% to the Lord and challenge him to take care of my needs and bless my dreams. As if on cue, my mother texted me asking for a donation for the chapel that will be built in our community. And I would need to give 10% of my salary for 2 months.. Hehe. Well, as Sister Rissa said in her talk, make tithing a habit. In the first few months, it would be difficult. But once you get used to it, it won’t hurt your pocket anymore. And God will let His blessings overflow – that is His promise. 🙂
God, our Father, loves us so much and He wants us to enjoy our money. God bless! 🙂