Getting Started

How an Employee Can Prepare for Retirement

By Cary Yamut, Brighterlife.com.ph

Office-WorkerWe have a lot of “ordinary employees” in this world who value the importance of hard work, wakes up very early in the morning and eventually earning a decent salary to ensure that they’re able to address basic needs in life – such as food, clothing and shelter. These are people who appreciate the value of being employed, having a job to survive.

For some reason, these people don’t have the luxury to fully learn and understand the basic fundamentals of money management. As much as they want to set money aside, they only have little knowledge or access about financial planning. I guess balancing their income versus expenses makes it difficult for them to start planning. When it comes to planning for their retirement, they normally rely only on what the company/employer will just provide like basic salary and company benefits – the question of tenure, loyalty and rising from the ranks are part of the equation.

We’ve seen a lot -– government employees, agency-dependent personnel, delivery boys and the like. These are the Juan Dela Cruzes of the world, these are the “ordinary employees” we must educate whether they are still starting, or even if they are in their middle age period to learn more financial ideas on how an ordinary employee can prepare for retirement.
If you’re employed, just like a businessman, treat your salary as your profit. The good thing about it, we already know our “profit” (salary) every month. All we need to do is to set aside portion of it, let it grow and start your quest towards a brighter Life.

Let’s examine how a normal salary of an ordinary, newly-hired employee looks like using some average computation.

If we were to compute the adjusted salary of Juan by the time he reaches age 65 (age of retirement) using the sample annual increase of 5%, it will look like this:

Juan’s adjusted salary by the time he reaches age 65 would be Php 64,402.

Now, if Juan decides to retire, how much retirement fund will he receive from his employer using a standard computation?


On top of this, Juan is also entitled to receive SSS Retirement pay, a government-sponsored plan which only ranges from Php 1,250 – Php 14, 750 monthly pension.

When Juan Dela Cruz finally retires to do what he wants to do with his time, is this amount going to be sufficient? Before we continue, here are some myths we need to shatter.

1. (MYTH) It’s the obligation of your employer to make you financially independent.
(TRUTH) It’s your personal obligation. The common thinking is that since the ordinary Filipino spends at least 9 hours in the office or in the field working, is that he will be bound by the amount he is to accept every payday. And since most of the salary goes to expenses, we are hardwired to think we will never become wealthy unless we win the lottery.

2. (MYTH) It’s only with a high income level that one can be financially independent.
(TRUTH) Shatter the delusion that just because you’re earning minimum, you cannot save. What you do with your money is more important than how much you earn.

Now, what if we teach Juan to set aside or allocate at least 20% of his current salary to prepare him in case of rainy days?

20% of Php 9,148 = PHP 1,830. This amount can be used to help Juan start his journey towards Brighter Life. In the beginning, this portion may be too much to just set aside but test it and you will see how life will be flexible enough to let you and your family live on less.

Let us divide Php 1,830 by 2. The amount will be Php 915. Why did i do that? The idea of doing this is to diversify his allocation to 2 baskets:

1. SAVING (for urgent needs, liquidity, short-term purchases)
2. INVESTING (for long-term financial goal)

If we were to put each Php 915 to both saving and investing and have it accumulated for the next 40 years, it will look like this:


Given his discipline to save and invest and adding everything, how much will Juan receive by the time he reaches age 65:
Going back to my big question: Is this already enough for Juan? It will really depend on what Juan dela Cruz wants to do when he retires and how much his desired lifestyle costs. At the end of the day, it all boils down to our ability to walk away from shelling out money for fleeting wants and saving them instead, as well as being able to foresee expenses so we can prepare for it. Juan Dela Cruz has to start somewhere.

Something important to remember, no matter what income level you’re in at the moment: TIME, MONEY, INTEREST RATE can work for us regardless of the size of your income. Always practice the 3 important habits in financial planning:

1. Save as early as possible,
2. Save regularly
3. Look for rates to compliment your need, both for short term (banks) and long term (insurance and investments)

Cheers to a brighter life ahead of you!

Cary Yamut, 35, is a trainer at Sun Life Financial Philippines. When he’s not busy training advisors, he can be found cooking Filipino dishes and exploring scenic nature spots. You may follow him on Twitter via @i_amgob

Image credit


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longingtosave on

is there available investment worth 350/month?

    grace on

    Hi longintpsaveis there available investment worth 350/month?

      grace on

      hi longingtosave!
      typically, you would need Php5,000 to open an investment account.
      you can save up your Php350/mth until you accumulate Php5,000 then open an account =)

      hope that answered your question. God bless!

icybleu on

What if someone wants to save yet not earning minimum wage is there an investment appropriate for them?

    grace on

    hi icyblue, typically, you would need Php5,000 to open an investment account. you can save up until you accumulate Php5,000 then open an account =) hope that answered your question. God bless!

tediberus on

40 yrs later that p6m is practically worth nothing

    onal g on

    P6M is still better than nothing. If you try to look on the negative side, make sure to also look on the positive side. And it’s always good focusing on the latter.

      flameskywiper on

      @tediberus, Php6M is more than nothing. Much worse if 40yrs later you still have loans to pay.

flameskywiper on

what would be the advantage of investing in mutual funds against stocks? which is better?

    grace on

    hi flameskyswiper, with Mutual Funds, you have a Fund Manager who would be doing the research/selecting which stocks to buy, and also doing the buying and selling for you. If you go into stocks on your own, you would be the one to do the research, deciding which stocks to buy, and deciding when to buy and sell.

yangofw on

im an ofw i have been looking for good investments where, what, and how? thanks

    Philip on

    Pm me yangofw ^_^

Jemer Abrigo Estacio on

i want to invest like whats on the sample board.. please contact me..

    Marlene on

    Hi Jemer. PM me your contact info and I shall be happy to draw a financial plan that is best for your needs.
    Have a nice day!

      Erwin Sarzuelo on

      hi, marlene. can you also provide me a sample financial plan that would suit my 15,000/ month income?

      Marlene on

      Hi, Ervwin Sarzuelo. I shall be happy to draw a plan for you, but first I need some information about you. It is very important to set your goals first, as a starting point. We have to take into consideration, your age, and very crucial too, is how much can you commit to set aside in order to achieve your goal. Savings and investment can be done at any income level. What is more important, is the commitment to follow-thru the plan.
      If you PM me your contact nos. then I shall be able to give you further details that is really catered to your current position and designed to meet your future needs.
      Thank you for your interest, and hope I can help you more.

Terry on

Hi which investment instrument was used to illustrate this? Mutual funds? Maxi saver or flexi?

    Arnold Billones on

    Hi Terry, I’m A Sunlife Financial Advisor and I would be glad to assist you regarding your queries. You can add me on facebook and pm your contact number. We can start from there. Thanks and God Bless

Joan Dellupac on

I want to start an investment, i need help on what financial plan best suit my situation. Thanks!

Marita on

I am very interested in this investment scheme, how can I go about it?

    Grace Cunanan on

    Hi Marita! I would be glad to give you more information regarding investments You can add me on Facebook and we can take it from there 🙂 Thanks! God bless!

dharma123 on

hi i want to manage my money and want to start an investment. I am an ofw and would want to ask where and how?

    marlene on

    Hi dharma123, pls pm me your contact nos. Its easy to start investing, i shall be happy to guide you.
    Take care

jamesjoaqs on

Hi, can u explain to me further more about the saving and the investment. Please. Thank you.

    Arnold on

    You can also add me on facebook and we can take it from there. Thanks and God Bless.

katrina chua on

if I have the 5,000 initial, what’s next? how much will i need monthly?

    Arnold Billones on

    Hi Katrina Chua, I’m a Sunlife Financial Advisor and I would be glad to assist you regarding your queries on investment. You can add me on Facebook and message me your contact number. We can start from there. You can also directly pm me your contact number. Thanks and God Bless.

Marlo Basco on

Im interested in investment for retirement..not insurance cause im already insured

John on

how to open an account? And is there an seminar for let say beginners

Madhel Marquez on

hi i want to start an investment and saving for my retirement, I’m already a sunlife client for life insurance for 3 year
thank you…

ben on

Hi, I’m Ben. I want to start investing., but I think I need a financial advisor/ planner regarding investments. Can you help me.

thanks in advance.

SuperMac on

i would like to know more about mutual funds, how to start, and how much should i need. enlighten me please…

    Mika on

    Hi there! Kindly email us at editor@brighterlife.com.ph so we can find assign an advisor who can guide you to start a brighter life. 🙂 Thank you.

Sean Rafael Juen on

where is the best to open an investment account?

dnrjuan on

I am turning 46 this August and I want to be financially secured when I do retire. I do have a company sponsored retirement plan aside from social security. Sad to say I am just starting to save again. I am single, a non-smoker and non-drinker. I do have hypertension but it is controlled. I am also obese. I am still living with and taking care of my elderly mom. I really want to have another source of income when I retire at either 60 or 65. I want to start saving and investing before my next birthday. Please help me.

    dnrjuan on

    I am free during weekends and I could be reached through my landline number. I also more comfortable dealing with a male Sunlife advisor if that is possible. I have actually sent a separate email to the editor. I can provide you my contact number when I get a reply from the editor. I am not comfortable giving any personal information through this message board.

    rodel on

    Hi dnrjuan hope you already find a Sunlife advisor so that you can start your plan as early as possible.

      denrjuan on

      No I still don’t have an advisor.

    Mika on

    Hi there! A financial advisor can help you get started. Please email your name, location and contact details to editor@brighterlife.com.ph so we can refer you. 🙂 Note that consultation is free and purchase is not required if not ready. Thank you.

J on

Hi, I am an OFW and would like to invest in Mutual Funds and Life Insurance for the future, Kindly send me information please. I want to start as soon as possible. Any financial advisor to help is much appreciated. Thanks.

James | Money and Opportunity on

If only Philippine companies teach this to their employees more Filipinos will retire wealthy. Imagine how many young prof will benefit from this knowledge. I’ve worked in 3 companies since I graduated and none of these companies taught me how to build my nest egg. I had to do my own research and learn by experience. If I had access to information like this when I started working, my retirement fund would have been way bigger than it is right now. I hope more people will read and learn from this article.

Phunsukh Wangdu on

Hi, I’m interested in retirement planning as I don’t want to be poor when I reach the so called ‘sunset stage’ of my life. I’m 27 now, and sad to say it’s only at this age that I get to realize the importance of saving and investing. Can anyone of you recommend a good retirement plan to start with? And I also want to maintain a savings account at the same time that will serve as an emergency fund. Aside from that, I also want to take a portion of my income for equity investments. To give you a bit of an info, I can only spare 6k from my monthly net income as I have other financial obligations to attend to. Please recommend a good product for my investing needs. Thank you.

    Mika on

    Hi Phunsukh,

    Thank you for your interest. We’re happy to know you’re taking steps in securing your future. We can have one of our financial advisor help you and discuss with you your options. Kindly email us at editor@brighterlife.com.ph. Thank you and have a bright day. 🙂

Joy on

Hi I’m Joy OFW in Kuwait, I’m interested in investment, I have questions before I enroll. Can somebody help me. Thanks!!

    Mika on

    Hi Joy! You may email us at editor@brighterlife.com.ph so we can assign a financial advisor for free consultation. Have a bright day!

leth vargas on

hi, what if i am interested to be one of your financial advisor? what are the requirements and procedures? thanks

    Mika on

    Hi Leth! Applying for an advisor requires a series of interviews, tests and training. You may want to attend our upcoming Business Opportunity Forums to know how you can be a Sun Life advisor. 🙂 See the schedule here: http://bit.ly/1qZbXAA . You can also submit your CV to mtber@sunlife.com. Thank you 🙂

nzoman on

hi, i’m an ofw working in saudi arabia.. i would like to learn more about investing. like in mutual funds and other stuff like that. is is possible to open an account even if i’m currently here in saudi arabia??

Bong Guevara on

Hello, Im Bong, a public school Teacher/Guidance Coordinator… My wife is also a teacher but in a Private school. We are still in the process of paying our car and sending our 3 siblings in school. We are having our first baby this November and we have a house in process with PAG-IBIG pa.. in addition, Im going to study MA to be a licensed Guidance Counselor for me to be able to have more income as professor and consultant… With our status, can we open an investment account in this company?… Saka, may advisor ba na taga San Jose del Monte, Bulacan?… Sana may makatulong. 🙂

    Mika on

    Hi Bong! Thank you for reaching out to us. Here at Brighter Life, we believe that everyone can achieve a bright future with the right knowledge and mindset. Like what we always say, it doesn’t matter if you start small, it’s all about committing to save and invest regularly. You may have a lot of responsibilities, but you can manage it by setting goals and priorities. To start, you can refer to the 7 Bright Choices You Can Make Today for a brighter life. When it comes to investing, you may look at mutual funds which you can start investing in at a minimum of P5,000. Then you may choose to add more to your investments at a minimum of P1,000 only. And yes, we can refer you to an advisor in Bulacan, you can email us at editor@brighterlife.com.ph with your contact details. Thank you and hope this helps. 🙂

CEN on

Hi! Ask ko lang po if pwde mag invest like php, 5,000 pero it depends on me if how much add ko per month?

    Mika on

    Hi! You may want to try looking into mutual funds where the initial minimum investment is Php5,000 and then for subsequent investments, the minimum is Php1,000. You may check out Sun Life Prosperity Funds website: sunlifefunds.com for more info. Whenever you’re ready, you can email us at editor@brighterlife.com.ph so we can have a financial advisor help you get started. Thank you 🙂

sel on

Hi Mika, may I ask you, How did you came up with 3M+ at 40years duration?Let me know please….Tanx

    Mika on

    Hi Sel! As shown in the illustration, the author computed to allocate at least 20% of Juan’s current salary for savings and investment which is P 1,830. The author then divided it to two, P 915 for savings and the remaining P 915 for investment. For the next 40 years, if Juan is to invest the P915 monthly with a sample investment rate of 8%, by age 65 he will have P3,071, 995.22. Hope this helps. 🙂

renante lutero on

I need a financial advisor to reach my goal, very much interested in VUL. Kindly advice
.thank you.

    Mika on

    Hi Renante! We’ve already replied to your email to assign an advisor for you. Kindly check your inbox. Thank you 🙂

emer kalipi on

Hey youre telling me that my 65 years in this world i can only earn as much as 9 million php unless i got lucky and win the lottery or something? Men i hate this! Em only 23 years old and this gives me less hope, i think ill just work abroad

    Mika on

    Hi Emer! The numbers above are just an illustration. The amount you earn through your savings and investment will be higher or lower depending on how much you actually earn, save and invest. There is still hope for every employee. You work hard every day to earn money. There is also a way to make your money work harder for you through saving and investing early. If you think your salary won’t be enough by the time you retire, we suggest looking for other ways to earn more money such as sideline jobs or opening a business. You may also invest in financial instruments that earn higher than the inflation rate such as the stock market or mutual funds.
    As stated by the author, in the end, whether the amount you have by the time you retire is enough or not, it all depends on you. It depends on the kind of lifestyle you choose and your ability to save and work for it. Hope this helps. 🙂

Cristito Fortunato Cabral on

Hi..my name is Cris Cabral. I am OFW and 59 years old retiring next year. I started investing in SunLife Grepa (SLG) Opportunity Plan for five (5) years. I try it but in my mind I want a shorter term lets say 2-3 years..is there anything you know an investment like this and yearly I can get my profit whenever a need arise or in case of emergency. Please advise. Thanks.

Best regards

    Mika on

    Hi Cris! Investments are usually designed for the long-term (preferably 5 years and up) to yield significant growth of your money. You may want to have a free consultation from one of our financial advisors to know what kind of investment or Sun Life product will suit your needs and goals. You may email us at editor@brighterlife.com.ph with your contact details and location so we can assign an advisor for you. Thank you and have a bright day!

Maris on

great article, an eye opener for employees, it’s not how much you earn that matters but how much you save and invest. Knowing is good but what you do with what you learn is the best thing that you can do today.

    Sammer on

    Hi Sir/mam I have question on saving and the investment. Im one of the Juan dela Cruz with minimum wage earner. As early as my age id like to invest my money. Now im turning 26 I realized to secure my future. Can you help me for brighter life. if I have 5000 iniTial investment. Whats next po…please paki explain further po im so interested. Thanks.

      Mika on

      Hi Sammer, the first step is a free consultation with one of our financial advisors. Kindly email us with your location and contact details to editor@brighterlife.com.phso we can refer you.

Jaime Roncales on

Still possible to invest even i’m already 54 years old?

    Mika on

    Hi Jaime. Yes! A free consultation with our financial advisor will help you get to know what kind of investment best suits you. You may email us at editor@brighterlife.com.ph so we can refer you to an advisor. 🙂

      Annah on

      Hi i would like to invest and save for my future hope someone could help me thanks

      Mika on

      Hi Annah, you can email us your details at editor@brighterlife.com.ph so we can find a financial advisor for your free consultation. 🙂

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