Which is the Best Type of Bank Account for You?

Not all bank accounts are made equal. Opening an account with your preferred bank will present you with a selection of bank account types. These types come with their own pros and cons, and these will affect how you can access your funds in the future. 

Let's take a closer look at your options to see which best suits your needs, shall we?

Savings Account

The savings account is the simplest type of bank account. It’s easy to set up, so it’s no wonder that most young professionals open their own savings account as soon as they start earning money on their own.

A savings account is a safe space where you can store your money. The money stored in the account will earn interest between 0.5% to 2% annually.

Convenience may be the biggest advantage of having a savings account. You can deposit and withdraw money from your account at any time. Plus, you can also link your savings account to lots of digital wallets so it's easier to shop and pay your bills online. 

Most savings account require you to present an ID, proof of address and an initial deposit. Once the account has been opened, you’ll need to keep a maintaining balance for 30 days. 

Note: If the balance in the account dips below maintaining, then the bank may charge you with a penalty fee. Also, your bank may impose transaction limits and charge additional fees if you use a different bank’s ATM to withdraw money from your account.

Opening a savings account is the best option if you want to enjoy a quick and easy application process. It doesn’t take a lot of effort or money to keep a savings account, so you can open one under your name even if you’re still starting out in your career or you don’t have stable employment yet. 

A savings account is also the best place for building an emergency fund, as you have full access to your money anytime you need it.

The downside? It's super easy to splurge and spend if you can access your savings with a few clicks. Also, most savings account programs also yield little in terms of interest, so it’s not the best choice if you want to invest and grow your money.

Checking Account

Also known as current account, a checking account offers all the benefits of a savings account plus the ability to issue checks. Checking account owners get to use paper checks and debit cards to access their money. Compared to savings accounts, checking accounts require higher initial deposits and maintenance fees.

On the upside, checking accounts are not as restricted as savings accounts are in terms of transaction limits. This means checking account owners don’t have to worry about exceeding a certain amount of money every day or month. 

Checking accounts are also an ideal option for people who regularly deal with bigger financial transactions. With checks or post-dated checks, you can easily arrange automatic payments that involve bigger amounts of money. Using a checking account also leaves a paper trail, which can be quite useful if you need to double-check your transactions.

Time Deposit

If you want to invest your savings, you can open a time deposit. The money in a time deposit can’t be touched for a fixed period of time, which can be between 30 days to 7 years. At the end of this pre-agreed term, the fund can earn anywhere from 1% to 3.5%  in interest — higher than what you can get out of a regular savings account.

When setting up a time deposit account, it’s important to assess exactly when you will need the money. While it’s possible to withdraw the money in your time deposit account before its maturity, doing so comes with a lot of penalties. 

Time deposits are a great option for conservative investors and people who have money that they won’t use for some time. Remember, though, that while time deposits offer higher interest rates compared to regular savings accounts, it’s still likely that this fixed interest rate won’t be able to keep up with the inflation rate.

These bank account types offer a wide range of benefits that will suit different lifestyles. There’s no objective "best" option here; the important thing is that you end up with a bank account type that complements how you earn and spend money. 

Take a good look at your relationship with your finances, and you’ll have an easier time deciding if a savings account, checking account, or time deposit will help you achieve your current and future financial goals.

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4 Things You Should Know About Refinancing Personal Loans

The current pandemic has led most people into skipping personal loan repayments.


Loss of jobs affected millions of Filipinos such that the state-run Credit Information Corp (CIC) continuously urges banks and lenders not to tag missed payments as delinquent.


The government further enacts the Bayanihan 2 into law extending debt relief programs with 60-day grace periods.


But things could be different if your loans are raking high-interest rates. You end up enjoying the debt relief grace periods but your debts remain unsettled for a long time.        


What is personal loan refinancing?

Personal loan refinancing is the same concept as debt consolidation. You apply and take out a new loan to pay off your existing loan. Debt consolidation could cover all your existing balances including credit card debts, car loans, and home loans. For personal loan refinancing, you can opt to cover loans of your choice.


The goal is for you to end in a personal loan that offers better interest and repayment schemes.


Loan refinancing is a choice most borrowers make to get a more affordable loan. For example, a personal loan taken 12 months ago was offered a 12% interest per annum. Today, the same loan is offered at 8-10% per annum. If that is the case, then refinancing an old loan with a more affordable one is a practical decision.


When should you refinance a loan?

You can apply for a new personal loan as long as you have a good credit score. That is if you have been consistently paying your installments in full and on time. However, you should always think twice when taking out a loan because there are certain situations you should consider before applying.


  • Refinance an existing loan if the offer will have a lower annual percentage rate over your old loan. You can also consider switching from a variable rate loan to a fixed-rate loan so you can take advantage of consistent installments each month.      


  • It is time for refinancing when your income has decreased and you can no longer afford your existing installments. Banks offer loan refinancing in connection to the massive loss of jobs that occurred during the pandemic. Refinancing can let you choose a loan that requires a repayment you can afford.


  • Refinance an existing loan if the loan offer will prevent your debts from piling up. Some refinancing may have hidden charges which you may not be aware of. Having said that, you should not only focus on the interest rates but also on the cost of processing and other fees entailed with the new loan.


What are the pros and cons of refinancing?

Not all financial facility works best for borrowers. If you compare personal loans online, you will see how to offer doffer from one lender to another that will affect the impact of refinancing your existing loan. Here are a few advantages and disadvantages you should be aware of:

Advantages:


1. Lower interest


Most lenders offer dropped rates especially in times of crisis. Refinancing has the potential to reduce your debts and save more money on interest and fees.


2. Extend your loan tenor


With a refinancing, you are refreshing an existing loan while also extending its tenor. This will make everything more manageable considering that you can reduce your debt while allowing more time for you to acquire money for repayment.


3. Payment stability


Most loan refinancing offer a change from a variable rate to a fixed rate. That means more stability in terms of the repayment amount. This can help you plan your finances ahead of time.

Disadvantages:


1. Extra costs


Certainly, the annual percentage rate for new loans can seem lower but some lenders may impose other fees. Processing fees can be a one-time charge which could be higher than the interest charges you’re paying for the old loan.


2. Early repayment charges


Some lenders charge early repayment fees when closing off loans ahead of the term. If the charges are much lower than the total cost of your new loan, then refinancing can be right for you. On the other hand, if all fees entailed closing an old loan and opening a new one, then you might want to consider staying with your current lender.


3. Higher interest


This might seem confusing but a new loan may cost much higher interest in the long run. Refinancing will let you apply for a loan at a much longer-term. Over time, an extended loan will be equal to higher interest costs. More often than not, a new loan will have a much longer-term than your existing loan.


What to consider before refinancing?


The advantages and disadvantages are important factors to consider when deciding whether to refinance a personal or not.


On the personal side, you should also check your income and your credit profile. Your income is important in calculating how much could you spare for loan repayments. It will help decide which loan to take especially when you’re up to reducing the monthly installments. Moreover, your credit profile is an essential consideration, especially for lenders.




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2 Reasons Why Getting An Auto Loan in the Philippines May Be A Good Idea

Nowadays, a lot of people prefer buying cars in cash instead of applying for an auto-loan. 

This is acceptable, if you have enough savings to tide you over, but if not, your entire life savings may get depleted and you won't have anything left for your emergency fund. 



Sometimes, to get a car as soon as possible, people also buy pre-loved cars -- but if you don't have enough knowledge, time, or help from an expert to check the car, you may end up paying more than what you've bargained for. 

In the Philippines, all commercial banks offer auto-loans. The good thing is that despite loans seemingly being expensive, they really have lower interest rates compared to other types of loans.



Here are two reasons why getting an auto loan in the Philippines is a good idea:

1. Car loans are flexible


No matter how much your lump sum is, you can afford an auto-loan in the country. Most banks offer an auto-loan for as little as 20% down payment.

For a car or SUV that is worth P1,000,000, you only have to shell out P200,000 plus around P20,000 for taxes, documentation and other miscellaneous charges.


It will take you some time to save up for the 20% down payment, but it's faster than saving up for a higher percentage down payment. And if your car is to be used as an income source, the opportunity cost alone is enough reason to get an auto-loan so you can start making money with your car. 

If you can afford to pay the monthly amortization of the car for five years, then all it takes is roughly two years to save up for your 20% down payment.

The average interest rate for auto-loans is between 4% to 30% -- but since we're under the assumption that you're buying a car to use it as a source of income, this is much better than getting a personal loan which doesn't have any goal behind it. 

2. Accessibility of car loans

All commercial banks in the country offer auto-loans. The interest rates may vary so you can go with the best bank that meets your specific needs. 

All banks also offer flexible terms: you can buy a car for 20%, 30%, 40%, or 50% down payment. 

For you to get started with the process, research for the starting price of your target car. Then, to save time and resources, you can also check online to compare car loan offers of different banks. 



Once you've decided, you need to dedicate a day when you will contact the bank (either online or in the branch) so you can receive the list of documents required from you. 

Tip

If you want to shop for a loan, you can use a tool called UpFinance. It is an online tool that can help you compare loans between financial institutions. With this, it will be easier for you to decide which bank you want to do business with.
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#MyBankHero: Here Are 3 Things BDO Did To Show Their Reliability And Compassion During COVID-19 Crisis

In a way, the COVID-19 crisis has been an eye-opener for Filipinos. 

It has enabled the people of the Philippines to prioritize their health and well-being. 



It has made us all realize the true nature of the politicians we voted -- if they were helpful or not during this crisis. 



And it has also let us know which companies really cared enough for its customers to help them during their times of need. 

Personally, I'm happy to have a BDO Gold credit card, because I find BDO to be helpful during COVID-19 crisis. Here are three things they did to help Pinoys -- they found ways talaga.




1. Payment Extension for 60 Days 

During the Enhanced Community Quarantine announced to flatten the curve for COVID-19, other banks didn't make any announcements about payment extensions.

Other banks announced a 30-day payment extension.

BDO decided to take it one step further and announce a 60-day payment extension. 




I considered this announcement as a sign of the company's reliability. They know that because of the quarantine, a lot of people were strapped for cash, so they gave their customers a two-month adjustment period to catch up. 

Such a #MyBankyahinan move, don't you think?

2. Safer way to bank with BDO Online Banking 

While banks remain open to service the banking needs of clients amidst the enhanced
community quarantine prevailing in Luzon, BDO Unibank encourages the heightened
use of online banking service to protect the public from the spread of the pandemic.

“We urge our online banking users to share and teach their family and friends how to
sign up and use BDO Online Banking so they can bank safely from home,” the Bank
said in a statement.

BDO has provided steps to guide its customers on how to sign-up for online banking.

These are found on its official website www.bdo.com.ph.

They also posted the instructions on their official Facebook Page. 




For those who are visual learners, you can follow their instructions via their BDO Youtube channel as well.



With BDO Online Banking, customers can perform transactions such as Send Money,
Pay Bills, Reload and more. 

Apart from online banking, BDO’s network of ATMs and Cash Accept Machines is
always available for cash withdrawal, bills payment and deposit. It's very convenient, since you can do basic transactions without lining up in the bank branch anymore.

3. Option to lock cards online 

I don't know about you, but I've experienced credit card fraud with another bank before. 

One day, I decided to check my online account and I saw around P26,000+ debited from my credit card -- these were purchases made from my account, purchases that I did not make! 

In panic, I tried calling my bank's hotline. It took me around 2 hours just to speak with an officer. 

That's why I'm thankful that BDO allows you to lock your credit card online. This way, no one can use your card while you're settling your account and waiting for the results of the investigation. 

You can do this in less than 3 steps:


In addition to these, BDO Unibank also makes sure to protect the health of their employees by encouraging the customers to put their masks on when entering their branches. 

Considering that employees of banks like BDO are also considered front-liners during the COVID-19 crisis, I urge every reader of The Wise Living to kindly pray for these amazing individuals and give them the appreciation they rightfully deserve. 


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Cheapest Ways to Transfer Money from the Philippines and from Overseas to Philippines

It's no secret that the congenial manners, impeccable English and reasonable rates of Filipino professionals have made them indispensable to the global workforce. Personally, I'm proud to say that my parents were OFWs as well. :)

Their value to corporations and small businesses can be immense. In fact, some companies in the BPO industry compensate their employees with a salary up to $700/month – more than some doctors make. As such, there is no shortage of skilled workers waiting for entrepreneurs to hire them.

Filipinos are also multi-talented and educated experts who can perform a variety of tasks professionally: from accounting, virtual assisting, writing, coding, customer support and even graphic designing, you can depend on them to do a job well done.

As a result, countless businesses hire Filipinos as remote employees. Want to join the party? To do so, you’ll need to send money to a Philippines bank account from abroad every month. Sure, this task may sound simple enough, but if you don't do it right the first time, it may cost your business thousands in losses.

In today's blog post, you'll find out why sending money via bank transfer or Paypal is actually hurting your company. To remedy this, you'll also learn about the best way to do money transfer cheaply and conveniently.

How much does it cost to send money to the Philippines?

Paying $300/month to your Filipino employee sounds straightforward enough. But because of the costs associated with money transfer, you need to consider that you need to pay more than that. 


How much more, you ask? Well, if you're sending the money electronically via banks like Wells Fargo, it'll cost you $35/transfer: almost 12% of the money you're transferring.

And the unnecessary charges don't stop there. You're also subjected to bank's own exchange rate.

Their USD/PHP rate – 48.5509 – is 4.4% off the interbank rate of 50.7854. To pay your remote employee the $300 you owe them, you’ll need to send roughly $350/month to pay for the money transfer costs. An extra $50/month translates to $600/year that's wasted on ridiculously high transfer fees.

PayPal isn’t any better. When receiving funds outside the US, a 4.4% withdrawal fee applies, too.

Moving to the Philippines? 


You may be ahead of the game when it comes to outsourcing to the Philippines. If you already have an organization there, you may be heading there to manage the team.

If you’re about to move to the Philippines, you’ll have to move assets abroad to avoid double taxation.

Let’s assume you’re moving $30,000 to BDO Bank in Manila.

When setting up the transfer, Wells Fargo will offer what they say is a “reasonable” rate. Usually, their USD/PHP price will be 2% off interbank – in this case, it would be 49.7697. This means you’ll end up with Php 1,493,090.

So, great news for you, right?

Not really. It'd be better if you could trade at the interbank rate. If you moved your assets at USD/PHP price of 50.7894, you’d get Php 1,523,680.

That's a difference of P30,000 or $600 – and imagine what better things you could do with this amount of money, instead of paying your bank just to click some buttons and maybe type a little bit on their keyboards.

Don't lose hope just yet, though. Times are changing. Companies such as Transferwise, and Currencies Direct can get you far closer to interbank than you ever thought possible.

Which money transfer firms are best for moving cash to the Philippines?


According to InternationalMoneyTransfers.org, Transferwise is the best choice for small transfers. They charge the interbank rate for cash shipments of ANY size. To make money, they charge a nominal fee on transfer amounts.

For example, to send $300, you just need to pay an extra $4.50 (1.5% of the transfer amount). Shelling out $304.50 compared to $350 is a much better deal for you, don't you think?

What about if you’re moving funds to the Philippines?

Then, a firm like OFX is well-recommended. This company has decades of experience working with businesses, traders, and high net-worth individuals.
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5 Reasons Why I'm Saving Up For Paris Next Year

In the past, I treated Paris like a standard item that needs to be checked in my (not-so) bucket list just so I could say I truly lived. 

Everyone says you need to go to Europe. 

All the movies I've watched romanticized the idea of Paris, the fashion, the culture, the people - the food! 

Ask every millenial where they'd want to go to, if they had a chance, and there's a 75.99% possibility that they'd include Paris in that list. 


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15 Unexpected Ways to Save More Money Today

Save your money. One day, it'll save you.  

Tired of personal finance tips that advise you to save money, without actually telling you how to save money in the first place?




In this short but packed blog post, we talk about 15 ways on how you, my fellow millenial, can save more money, starting today:

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How To Be A Financial Advisor: 5 Reasons Why Being A Financial Advisor is Perfect For You

A few years ago, I never thought I’d become a financial advisor.

I’m an introvert with no experience in sales – how could I join this career?
But then last 2012, something devastating happened to our family. My lolo suffered his 2nd heart attack and still insisted to be taken to a public hospital far away from our house just because he didn’t want us to spend a lot of money.
And even though I was already working and earning money, I didn’t have the confidence to tell him, “Ok lang yan, ako na po bahala magbayad…” because even though I had an income, I didn’t manage it properly so I didn’t have any savings of my own!

It wasn’t until my lolo Tatang passed away that I realize something: I wanted to be a financial advisor because I’m passionate to share my story to other Filipinos. It was a heart-breaking experience. I don’t want you to experience the same thing.
Now, if YOU desire to teach Filipinos about:
  •  How to manage their money properly – so when they encounter an emergency, they have funds to use for it,
  •  How to protect their income – so that whatever happens to the breadwinner, their family is taken cared of financially,
  •  How to achieve a comfortable retirement – so when they finally stop working, they can enjoy their “golden years”,
  •  How to start investing their hard-earned money, so they can get higher returns than banks…
Then YOU may also be interested about how to be a financial advisor, don’t you think?




Ready to be a financial advisor and change people’s lives for the better? Email me your updated CV/resume at [email protected] or add me on Facebook at https://www.facebook.com/LianneMarthaLaroya today.


5 Reasons Why You Should Be A Financial Advisor

1. You want Time Freedom.

You’ll work, yes, but you can also enjoy more time with your families. 
When you become a financial advisor, you DON’T need to go to the office from 8 am – 5 pm. You work at your own time.
Have children you’d love to spend more time bonding with? Wouldn’t it be nice if you can make them breakfast and help them with their homework, too? You can do this when you become a financial advisor.
My friend who’s a single mother and also an amazing financial advisor works from 7 am – 2 pm only. She gets to help Filipino families improve their financial lives and she still has time to pick up her son from school everyday.
Have aging parents you’d love to take care of? Or do you have a spouse/life partner you’d love to enjoy life with together more?

What if you want to go to Japan for your honeymoon? Or you want to go to South Korea to celebrate your father’s 60th birthday? You don’t need to file for leaves. Just manage your own working time properly. Whether you work from 6 am – 12 noon, or 3 pm – 9 pm, or 8 am – 1 pm or whatever other working schedule you’d like, it’s all up to you. 

2. You want Location Freedom.

When you become a financial advisor, it’s like a mini-adventure everyday. One day, you may be meeting your clients at a coffee shop in Ortigas City. The next day, you may be meeting clients at their offices all throughout BGC Taguig City. Or maybe next week you’ll meet your client at their home based in Laguna. Or what if next week you choose not to work for three days? It’s all possible.
You can dictate where you want to work. 
Just last June, my family and I went to Tagaytay to have a staycation for my birthday. At the same time, I met with two of my clients based in Tagaytay so I can service them personally. That’s working hard and playing hard – at your own time and at your chosen place!

3. You want to improve the lives of your family and friends. 

Aside from choosing when to work and where to work, I’m sure you’re interested to be a financial advisor because you want to secure a better and brighter future for your family, your relatives and of course, your friends, right?
As a financial advisor, you can make a positive difference in the lives of your friends and families.
After all, you’re teaching them to how secure their income and invest their hard-earned money for college fund of their kids or for their own retirement fund in the future! You’re there to help them and their families, in sickness, in disabilities and even during, God forbid, death.

Being a financial advisor is a career that you can be proud of. Through this, you get to give practical and doable financial advice that your clients can use to manage their income properly.
You get to help families achieve the brighter life that they desire – it’s a noble profession! 
Ready to be a financial advisor and change people’s lives for the better? Email me your updated CV/resume at [email protected].com or add me on Facebook at https://www.facebook.com/LianneMarthaLaroya today. 

4. You want unlimited income.

When you become a financial advisor and join my team, you write your own pay check. There is no limit on how much you can earn because you’ll receive fair compensation for all your hard work – and only you can dictate how much money you’ll receive in your bank account every 15 days.
Because of Sun Life, being a financial advisor helps me send my brother to college, purchase multiple lands in our province, start several life insurance and investment accounts, buy my first car (this 2017!) and travel to local and overseas destinations with my loved ones.

5. You love getting awards and being recognized for your hard work.

If you’re driven to succeed and you’re passionate in receiving recognition for all the meaningful work that you do, then you deserve to be a financial advisor.

BONUS:

  • Since Sun Life is committed to helping you become the best financial advisor you could be, you can attend Sun Life’s free training sessions regularly – you’re learning and earning at the same time.

  • Additionally, if you become a financial advisor and join my team, Sun Life provides you with a Retirement Plan that you can enjoy when you reach your own golden years!

  • Love travel? As a Sun Life financial advisor, you have the privilege to receive travel incentives locally and abroad. 


How to Be a Financial Advisor:

It’s simple. You just need to email me your updated resume/CV: 
Subject: Lianne, I want to join your team! 
After you email me your CV/resume, I’ll contact you and we’ll talk about why you want to be a financial advisor. You can also call me at 0906-243-5059. And then you can start training online: 



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