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PERA for your retirement
By: Alvin T. Tabañag, RFP®
Have you ever wondered how your life would be when you are retired? Not quite comfortable for millions of Filipinos if we look at the figures. As of June 2006, the monthly SSS pension of retirees ranged from P1,000 to P14,970. Since most SSS pensioners are at the lower end, the average monthly pension was a measly P2,546.00. For a sickly senior citizen this pitiful amount is probably just enough to buy medicine. If this is not bad enough, some studies say that SSS funds will only last until 2015; for GSIS it’s 2042.
It’s not hard to imagine that many retirees will be living in poverty in their old age without the support of their children. And for the really unlucky ones whose children are as poor as their parents, the only option...
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How important is Financial Planning!
 Years ago, the financial life of the average family was relatively uncomplicated. People worked for the same company most of their lives, lived a few years in retirement on Social Security and their pension, and passed their modest estate on to their children. However, increased longevity, changing demographics, and a more complex, dynamic financial world have changed all that.
Consider these tough financial facts:
- Many of today's retirees will live 30 years or more in retirement - requiring far more financial resources to maintain their desired lifestyle.
- Social Security and company pensions may no longer provide the majority of your retirement income.
- Tax laws change almost annually.
- Downsizing companies no longer provide "cradle-to-the-grave" benefits or job security. The average American changes jobs seven times in a lifetime, and millions are self-
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The Financial Planning Process
 Financial planning is a process - a process where you stop working for every peso and learn to start putting your money to work for you. The first step is to gather and analyze data about your income and expenses, taxes, insurance coverage, retirement plans, wills, trusts, investments, and other information that is pertinent to your overall financial situation. The next step is to set realistic goals, identify key financial issues concerning those goals, and implement specific strategies for achieving your goals. These strategies may include building an emergency fund, establishing a spending and savings plan, beginning or adjusting an investment program, purchasing disability or long-term care insurance, drafting a will, establishing a trust or developing a business succession plan. The last step in the financial planning process is to periodically review and, if necessary, revise your plan.
The financial planning process is not a "one-size-fits-all" package. It is a set of goals and strategies tailored to meet your specific values, abilities, and needs.
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Ask your RFP®
Q. How will you benefit from Financial Planning
A. Financial planning will give you a clear picture, perhaps for the first time, of where you stand financially. Many families have no idea of the value of their estate, how they spend their money, or what their money can do for them.
Financial planning will provide direction and discipline. Without this direction and discipline it is very probable you will make impulsive, random decisions; you might buy this insurance, invest in that hot investment, adopt the latest tax strategy. The pieces not only don't fit together, they may actually conflict with each other and compound the problem. Financial planning integrates your assets with your goals and objectives.
Financial planning can give you peace of mind. Uncertainty about finances creates anxiety. Money is the most common cause of marital stress and divorce. If you know where you stand financially, where you are going, and how you're going to get there, you'll feel more confident about your financial situation, about yourself and about your relationships.
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Do you have questions? Click here to ask now.
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Join The 1st RFP Program - Cagayan de Oro September 3 - 6, 2008 at Mallberry Suites, Lim Ket Kai Mall. Cagayan de
Oro City
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