How much do young people save and spend?
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| Financial expert Michael Manuel said that a huge chunk of personal consumption comes from the young professionals. (Photo by Joselito Villasis) |
As they earn money for a living, do they also think of saving? Or are they working just to spend what they have earned?
According to financial expert Michael Manuel, 70 percent of the Philippine economy comes from personal consumption and a huge chunk of this segment comes from the young population with 33 years old as the median age.
He furthered that 43.8 percent of the general population are spending more than their income; 51.5 percent are spending as much as their income; and only 4.6 percent are spending less than their income.
Manuel, who is also the chief business development officer of Sun Life-Philippines, noted that only two out of 10 Filipino households have a bank deposit account with a median balance of P6,875 and an average emergency savings of P200.
YOUNG PROFESSIONALS’ PERSPECTIVE
Twenty-three-year old freelance online tutor Maria Estephanie Mercado who earns P20,000 to P23,000 a month said she saves for her future needs.
She revealed that she is putting 50 percent of her monthly salary in the bank, while the remaining 50 percent is for her daily expenses and other bills.
However, Mercado admitted that her bank account is now almost empty as she spent the money for the renovation of their house, post-graduate education, gadgets and leisure.
She also reserves part of her salary to pay a portion of a land as one of her investments.
Meanwhile, 24-year old Romnie Tan, a call center agent in a sales and marketing firm, said he saves for both his needs and wants.
He mentioned that 50 percent of his monthly salary which ranges from P9,000 to P12,000 is allotted for his savings; 25 percent for his personal needs like food, daily allowance and clothes; and 25 percent for his household needs such as grocery, electricity and Internet bills.
For her part, Alyn Belgira, a 23-year old sales consultant in an insurance company, said she only allots 20 percent of her monthly salary for her savings. She disclosed that she is earning P20,000 to P25,000 at the average and her savings are reserved for her future and emergency needs.
Belgira added that she gives 40 percent of her salary to her family, 30 percent for her daily expenses and 10 percent for leisure.
Although she admitted that she spends more than she saves, she still invests her money in their farm and plans to get insurance as another investment.
EXPERT’S ADVICE
Sun Life Asset Management Company, Inc. (SLAMCI) president Valerie Pama encourages young people to pay themselves first before spending for anything else.
“Invest for your future. Don’t spend everything. Leave something for yourself and for your future. If you are earning a lot of money, save for the rainy day,” she advised.
SLAMCI has been offering products for the young professionals who want to grow their money. The company has a mutual fund product wherein one can start small at P5,000.
SLAMCI is continuously introducing more funds that receive good reception among Filipino investors. Its newest fund, Sun Life Prosperity Philippine Stock Index Fund, for example, has debuted strongly as it posted an Asset under Management of P542 million and a gross sales of P554 million two months after its launch last May.
In addition, SLAMCI will also launch two dollar funds soon, revealed Pama.
“This is in line with our continuing effort to provide clients with more choices that would cater to their different needs and preferences,” she concluded. (As published in Panay News)
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