FLPH Updates
Retiring and Getting Out of the Rat Race

Retiring and Getting Out of the Rat Race

As an OFW for more than a decade now, I know that our life working abroad will end someday. Most of us will go back to the Philippines and be with our loved ones. Whether we are ready or not, it’s inevitable. The only question by then is, are you prepared when it happens? When it do happen, there will be a lot of adjustments in terms of cashflow and finances.

There are 2 ways where we can plan our exit from being an OFW.

First is thru RETIREMENT. When I say retirement, it’s a point where you have more than enough money for yourself to spend in your lifetime. When that happens, you don’t need to work anymore. You have a pile of cash that perhaps may outlive you. For example if you want to retire ate age 50, let’s assume that your annual expenses would be at PHP1 million. If the average life span in the Philippines is around 75 years old plus additional 5% increase in your annual expenses, in 25 years you’ll need around PHP 47.7 million. If let’s say you have PHP50 million, then you have a very high chance of retiring and living comfortably. That’s if you do your planning correctly and you factored out all the possibilities. However, how many of us can retire with that huge amount of cash for retirement? Even myself will have a hard time accumulating all those wealth. Seems less hope to retire.

The second exit plan option you have is by just GETTING OUT OF THE RAT RACE. According to Robert Kiyosaki’s cashflow quadrant principle, there are 4 ways to make money. 2 of them, the EMPLOYEE and SELF EMPLOYED, requires our time to be exchange for money. When you don’t work or close your shop for a day, you will not get paid. The remaining 2, on the other hand, should be our goal in getting out of the rat race. This is by becoming an INVESTOR or a BUSINESS OWNER. By doing this, even if we are not working, people and our money are working for us. We are not trading our precious time to be paid anymore. Instead, we are leveraging on our savings for investment and other people’s ability to run the business for us. There are lots of investment and business available for us. There are risks involve, you just need to anticipate and manage it well.

In doing so, we have a higher chance of going back to the Philippines without fear of where to get money to spend everyday. It’s all about the expenses why we are working hard. If your investment or business earnings can take care of that, then you will live a worry free life. You can go back home anytime and you still have your passive income. You will be semi retired at least 🙂

However, it takes planning, skills and proper knowledge to do that successfully. That is why you need to plan your post OFW life the day you work abroad, and not on the day you want to go back for good. For sure you heard a lot of stories where OFW goes back with lots of money. Then open a business or invest in something that they didn’t understand, end up losing all the savings. Back to zero, they might go back abroad and start doing the cycle again.

Though it is not easy, it is not impossible. We can do it if we will equip ourselves with the right knowledge and we plan for it correctly. Financial education is the key if you want to succeed in your exit plan. This is what most of us lacks, financial literacy. We are more comfortable at home watching movie than attend a financial event. We choose to spend more on gadgets than saving or investing.

Most of us Pinoy’s are financially illiterate. Nobody taught us how to save and where to invest. We all know how to make money by being a good employee. That’s why most of us will end up relying on our loved ones for everything we need during our golden years. Lucky if your children have means to support you. What if not? It’s too late for you to realise then.

Plan now and educate yourself before it’s too late. If you are in Singapore and free during weekends, join us in our mission to promote financial literacy to all Filipino’s. Check out our list of events here TGFI SINGAPORE EVENTS.

About Richard Macalintal

Hi my name is Richard. I am a Registered Financial Services Consultant in Singapore. If you have any queries or you need help on your insurance policies and investment linked products, feel free to message me :-) We can have a cup of coffee while I do financial review and give advice with regards to your finances :-) Contact me thru email rlmacalintal(at)yahoo.com or SMS me +65 82235186. Disclosure: I am a Financial Consultant of AIA. The statements or opinions expressed on this site are my own and do not necessarily represent those of AIA.

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