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Diversifying Your Investments: A Personal Experience

When I was younger, I naively believed that a stable job with a decent salary would be enough to fulfill my financial aspirations. I envisioned myself working 8-9 hours a day in an office, diligently saving up for retirement. However, as I got older, I realized that this traditional path wasn't going to cut it, especially if I wanted to achieve early financial freedom. I needed to find ways to grow my money passively, while I was sleeping. Thanks to the internet, I discovered a world of opportunities to invest and build wealth. In this blog post, I'll share a glimpse of my personal financial portfolio and explain why I chose these investments.

Savings

Savings has been the cornerstone of my financial journey. I've consistently set aside a portion of my income each month, and I've also been disciplined about saving a significant portion of any bonuses I receive. While I'm not primarily focused on the interest rates offered by savings accounts, they serve as a crucial foundation for my investment strategy. Building a substantial savings cushion not only provides a safety net for unexpected expenses but also gives me the flexibility to invest more aggressively in the future.

Unit Investment Trust Fund (UITF)

My second investment was a Unit Investment Trust Fund (UITF). I was attracted to the idea of having a professional fund manager handle my investments, and I appreciated the low maintenance required. Given my moderate risk tolerance, I chose a balanced UITF that invests in a mix of stocks and bonds. This diversification helps to reduce risk while still offering the potential for growth. While there are associated fees, I believe the benefits of professional management and diversification outweigh the costs. I've been consistently investing in my UITF since 2020, and I'm pleased with the 7% return I've achieved so far. I see this as a valuable component of my long-term investment strategy, providing both liquidity and growth potential. My UITF portfolio is under Security Bank’s SB Peso Money Market Fund.

Pag-IBIG MP2

Pag-IBIG MP2 is another valuable addition to my investment portfolio. I appreciate the security and potential for higher returns that it offers. The tax-free nature of the earnings is a significant advantage, as it allows me to maximize my overall investment returns. I've chosen to let my MP2 earnings compound, which can significantly boost my investment growth over time. While there's always a risk of lower returns if the fund's performance is poor, I believe that MP2 is a solid investment option for long-term savers. I've already matured one MP2 account and used the proceeds for a down payment on my car. I'm excited to see the growth potential of my current MP2 account and plan to continue investing in it until maturity. Remember, MP2 has a 5-year maturity period, so it's important to ensure you're comfortable with the commitment before investing. 

Stocks

Stocks are another important component of my investment portfolio. I'm attracted to the potential for high returns, but I'm also aware of the risks involved. Before investing in any stocks, I conduct thorough research to understand the company's fundamentals, industry trends, and competitive position. To manage risk, I diversify my portfolio across various sectors and industries. I'm also a believer in peso-cost averaging, which involves investing a fixed amount at regular intervals, regardless of the stock price. One of the benefits of investing in dividend-paying stocks is the ability to reinvest those dividends, which can accelerate wealth growth. My current stock portfolio includes AREITs, RCR, MREIT, CREIT, COSCO, and GLO. These companies have a history of consistent dividend payouts, and I've been reinvesting the dividends to grow my portfolio. As of today, my overall stock portfolio has achieved a gain of approximately 12%.

Term Life Insurance

Term life insurance is an essential part of my financial portfolio, as it provides crucial protection for my family. I've chosen SUN SMARTER LIFE ELITE PESO 10, which offers a combination of death benefit and guaranteed cash values. The policy will earn a specific amount after 6 years and will continue to earn this amount every two years until maturity. Additionally, it also earns dividends year over year. I've carefully selected a coverage amount that aligns with my family's financial needs and ensures that they will be financially secure in the event of my untimely death.

Diversifying my portfolio has been essential for managing risk and protecting my wealth. It hasn't always been easy, but I've learned valuable lessons along the way. By staying disciplined, patient, and focused on the long-term, I've been able to achieve steady growth on my investments. I encourage you to start your own investment journey and experience the power of compounding for yourself. Remember, it's never too late to begin building a secure financial future. For more information and resources, I recommend checking out the following links.

SB Peso Money Market Fund:

https://www.securitybank.com/personal/investments/unit-investment-trust-funds/sb-peso-money-market-fund/

Pag-IBIG MP2:  https://www.pagibigfund.gov.ph/Membership_ModifiedPagIBIG2.html

Stocks: https://www.firstmetrosec.com.ph/fmsec/43-About%20Us

SunLife: https://www.sunlife.com.ph/en/insurance/education/sun-smarter-life-elite/

As for my future plans, I'm excited to continue expanding my portfolio and exploring new investment opportunities.



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