Guess what? After working for 3 years, most come back with nothing and the worst part is they are still in debt.
Benjamin Pimentel's article on How overseas Filipinos can win the battle against unbearable utang (debt) clearly explains the reason why many of our OFWs end up deeper in debt compared to their goal of eliminating debt, which is the very reason why they leave to work overseas.
I would like to cite a portion of his article that I believe is the key to getting out of this unbearable debt:
"OFWs should and must undergo financial literacy to protect and harness their money which is more often lost and squandered," he said.
Let's affirm a key premise here: Overseas Filipinos perform a vital role by sending money back home to help their families. But there¿s also a growing need for families to find better ways to manage funds coming from abroad.
And we're not talking about totally avoiding debt. In many cases, as I've noted, debt is necessary to meet a need.
But there's such a thing as smart debt and dumb debt. Worse, there is unbearable utang - debt that becomes so overwhelming that overseas Filipinos end up wearing themselves out as they find themselves trapped in a vicious cycle.
Charito Basa, an OFW advocate based in Europe, listed four general principles for overseas Filipinos and their families (which actually applies to everyone in this time of crisis):
Have a budget and stick it to it no matter what
There'll be special requests from family and friends that will tempt migrants to deviate from their budget," she says. Be firm. People will eventually understand that they are doing it for the good of everyone."
Save first, before spending (not the other way around)
Set aside a fixed amount for savings. Charito recommends at least 10 percent of one's income. She and Tony Ranque point to the tested formula for sound personal finance management: Income minus Savings equals Expenses.
Saving a portion of your income is a must, not an option," Tony says. If you cannot develop the habit of savings which is founded on discipline, force yourself to save by getting pension plans and other types of pre-need plans."
Have insurance (health, education, retirement, pensions)
When done through reputable companies, insurance plans can guarantee that needs are attended professionally and that funds are available when most needed," says Charito.
Stay away from "get-rich-quick" schemes
This rule also applies to everyone.
My experience tells me that most of our OFWs are not financially literate. This, I believe, is the main reason why they end up poorer that when they first left for work abroad. They just can't find time to educate themselves in money matters because they are too busy running after the money.
The painful reality is when their contract is finished, in a few months, they're broke again or you see them lining up to apply for work abroad again.
So, how can our OFW win over this unbearable debt? Maybe you have a better suggestion we can all use.
To our debt-free life,