Admit it. At the start of the year, one of your goals is to increase your savings and aim for a specific amount - and that's good.
The question now is how will you do that?
Putting up your own business is a good way to grow your money. Still, there is no assurance that money will be consistent. To ensure continuous growth, then investing your money is a good option.
Check out these investment options that will help you grow your money and achieve your financial goals for the year:
1) Time Deposit
If you want to minimize risks but still want to grow your money, then time deposit can be your best option. Unlike typical savings account, you get to earn higher interest, with interest rate up to four percent, depending on the amount of money you invested.
Banks impose different rates and minimum investment amount. It is best to check how much each bank offers to find out which among them is worth investing. As of this writing, Security Bank gives the highest interest rate for one-year time deposit but the minimum placement is at P100,000. If you want a time deposit that is easy on your pocket, then you can try PBCom's one year time deposit with minimum placement of P1,000.
2) Money Market Fund
If you want to earn higher than what time deposits could give you but still a bit conservative investor or trying to understand how investment works, then money market fund is your next best thing.
In this investment option, the money you invested will be placed in risk-free, short-term securities such as government Treasury bills or corporate bonds. The return of investment may vary, but you are sure that you will earn more than time deposits.
3) Balanced Fund
If you are between the conservative and aggressive investor, then balanced fund is the ideal investment for you. This is also recommended if you are willing to set aside a certain portion of your money for at least three to five years.
Balanced fund is a combination of both conservative and high-risk investment. This means your money will be invested in risk-free securities such as bonds and stocks. Banks offer Balanced Fund investment option and so far, BPI and China Bank are top performers in this category.
4) Equity UITF
Are you thinking of investing in the stock market but have no idea on how to handle it? Then Equity UITF is your best option.
The concept is the same with stock market since the money you will put in will be invested in stocks; hence higher investment yield. On this investment option, a fund manager will manage your stock portfolio so you have nothing to worry about.
5) PAG-IBIG MP2 Savings Program
Are you a PAG-IBIG member? If yes, then you need to take advantage of the government's voluntary savings program or PAG-IBIG MP2. This savings program allows you to invest at least P500 every month for five years.
Here comes the best part: this savings program gives out dividends, which have been steadily rising since it was introduced in 2010. Can you imagine eight percent dividend rate? Not bad, don't you think?
You can learn more about the PAG-IBIG MP2 savings program here.
In case you are willing to take a risk in exchange of higher return on investment, then investing in the stock market is worth trying.
Investing in the stock market is ideal if you are looking for long-term investment, preferably minimum of five years. The prices of stocks usually increase over the years, which means you can double or triple (or even quadruple!) your investment in a few years. In fact, this is how you earn and grow your money, especially when you will buy stocks at a cheaper price.
Nonetheless, investing in stocks is risky because of market volatility and instability as a result of various events. If you plan to invest in stocks, then make sure that you are willing to risk that certain amount of money because you'll never know what will happen in five or 10 years.
The bottom line is study these investment options to find out what works for you. You can mix and match your options to help you determine which are you more comfortable at. Keep your investment to its minimum - for now - and increase eventually for higher yield.