Our Future Plans

[aerosick]

While growing up I remember how excited I was when the weekend arrived and I didn\'t have school. We would roam the countryside exploring, playing with neighborhood kids, just having fun. When it got close to dark, we would listen for our mom or dad to honk the car horn which told us to get home within 15 minutes. When we heard 2 honks, we\'d better be less than 5 minutes from our country home. 3 honks and we were in deep do-do!  :\'(

My wife Eda\'s memories of weekends were of getting up very early and going with her family to the market where she would get \"parked\" and try to sell the small bars of soaps, small bags of asine (salt) or whatever her parents had bought that week for resell. She grew up poor and vividly remembers going to bed hungry many times. Now Eda is very careful with her purchases and is a real bargain hunter.

If I am gone from this world before her, we have set up not only her future monthly income, we also have purchased properties in both the USA and in the Philippines. Hopefully between these two countries she will stay comfortable in her declining years.

As I\'m 25 years older than her, the odds are high that this is the way it will work out. But right now we are battling an early stage of cancer found in Eda this year. Eda is fatalistic and now thinks that I will outlive her! 

Things happen to you and yours in the middle of your \"written in stone\" future planning. We try to stay flexible and stay open for what comes along.

As they say in the USA Midwest: \"who knows which way the wind blows when it snows\"...

Billy

[paulgee]

Billy, I hope all goes well for Eda in the future, it is indeed an irony that we all think our wives will outlive us. My wife is 24 years younger than me and I feel that way, though she is less certain.

Only recently married, my wife will at least have half of one pension I have recently started taking. Our future plans involve purchasing/building a property in the Philippines, but that is all in the future at the moment.

However, I do think it important to have something in place for ones wife, and it should not be too difficult to achieve at a basic level for most of us. After all a little money goes a long way for a Filipina in her own country, so a small income will give her (and probably some of her family members)  a decent standard of living.

One thing I am uncertain of is how a lump sum could be invested in the Philippines to return a decent interest rate, is that possible, and risk free for her to achieve ?

Paul

[aerosick]

Billy, I hope all goes well for Eda in the future, it is indeed an irony that we all think our wives will outlive us. My wife is 24 years younger than me and I feel that way, though she is less certain.

Only recently married, my wife will at least have half of one pension I have recently started taking. Our future plans involve purchasing/building a property in the Philippines, but that is all in the future at the moment.

However, I do think it important to have something in place for ones wife, and it should not be too difficult to achieve at a basic level for most of us. After all a little money goes a long way for a Filipina in her own country, so a small income will give her (and probably some of her family members)  a decent standard of living.

One thing I am uncertain of is how a lump sum could be invested in the Philippines to return a decent interest rate, is that possible, and risk free for her to achieve ?

Paul

Paul,

Thanks for the thoughts. Eda is still keeping this pretty quiet and I know that early stage detection will go in her favor.

We have a choice of a lump sum distribution here in the USA but won\'t take it due to taxes. Instead we will spread this out over 5+ years. Hopefully others will comment on this option.

Eda grew up poor and will be able to take care of herself and provide food as she learned when growing up. Owning property is a big comfort to her when she talks about what the future has in store for her.

Billy

[Lee2]

Billy I am truly sorry to hear of this and I am glad to hear that they caught it early on and therefore will surely cure it. Please tell Edna to think only positive thoughts because IMO the body has a way of healing itself and I am a firm believer that positive will wipe out any negative.

As you know, I am 20 years older than my wife as well so I too have tried to make sure she will be taken care of since she too grew up very poor and I never want her to have to go back to that way of life. Since my wife seems to be as healthy as possible and never even catches a cold when I have one because I started her early on with vitamins and such, I feel she will outlive me with all my medical issues and because of that she has made life a little easier on me by her wish to move back to the Philippines to live once I am gone which sort of makes it easier to plan for her future since costs in the US can be quite high on most things and there would probably never be enough money. I guess that even the best plans might go astray but we are moving in that direction and I feel that my wife should be OK because she is a lot smarter than I am. I am sure Edna will also be OK and ourlive us both.

Billy my friend, God bless and may 2010 bring you all the best things life has to offer and all your positive wishes which no doubt include Edna\'s not only beating this thing but going on to outlive us all. 

[Steve & Myrlita]

While growing up I remember how excited I was when the weekend arrived and I didn\'t have school. We would roam the countryside exploring, playing with neighborhood kids, just having fun. When it got close to dark, we would listen for our mom or dad to honk the car horn which told us to get home within 15 minutes. When we heard 2 honks, we\'d better be less than 5 minutes from our country home. 3 honks and we were in deep do-do!  :\'(

My wife Eda\'s memories of weekends were of getting up very early and going with her family to the market where she would get \"parked\" and try to sell the small bars of soaps, small bags of asine (salt) or whatever her parents had bought that week for resell. She grew up poor and vividly remembers going to bed hungry many times. Now Eda is very careful with her purchases and is a real bargain hunter.

If I am gone from this world before her, we have set up not only her future monthly income, we also have purchased properties in both the USA and in the Philippines. Hopefully between these two countries she will stay comfortable in her declining years.

As I\'m 25 years older than her, the odds are high that this is the way it will work out. But right now we are battling an early stage of cancer found in Eda this year. Eda is fatalistic and now thinks that I will outlive her! 

Things happen to you and yours in the middle of your \"written in stone\" future planning. We try to stay flexible and stay open for what comes along.

As they say in the USA Midwest: \"who knows which way the wind blows when it snows\"...

Billy

Billy,
So sorry to hear this. May God heal Edna to full health and vigor.
God Bless.....

[Lee2]

I personally do not think many of the banks would be sound in the Philippines or maybe even anywhere else in the world but they would have to be at least part of the plan. I have never lost money when owning rental property during my life, yet at times some problems did come about. I think rental property in the Philippines is the way to go. In hand I trust.

Maybe build a compound for rental units for foreigners as some have already done or buy up small inexpensive condos and rent them out or have a trusted rental agent handle them for you. If anyone wants a trusted condo sales person and rental agent in Cebu, feel free to contact me and I will happily put you with the young man. No way may be perfect but this way does seem to be working for the wife and I for the last few years.

My only advice would be the same as everyone knows it should be, try to buy low and therefore be able to rent low and while that may not always be easy, todays high prices will probably be tomorrows low prices as values seem to keep going up. The units we bought have doubled in retail value which literally means nothing because selling and retail value have little in common, but the retail price does offer a guide that might make sure to not lose money if forced to sell.

Good luck all and please be sure to give your ideas so we can all learn from you too.

[uk]

One thing I am uncertain of is how a lump sum could be invested in the Philippines to return a decent interest rate, is that possible, and risk free for her to achieve ?

Paul

you could invest a lump sum in a time deposit account with BPI or hsbc which would be low risk but  the interest rates are not great between 2.5% - 3.5% much like the rest of the world

[c_a_p_t_a_i_n_r_o_n]

I spoke to the manager of our RCBC bank and they had a LONG TERM DEPOSIT PLAN

LARGISH SUM NEEDED P500,000

NO interest for 1st 5 years
12% thereafter

gives effective interest rate of

6.55% after 10 years
8.25% after 15 years
9.14% after 20 years
9.69% after 25 years
10.06% after 30 years
10.33% after 35 years
10.54% after 40 years

I\'m sure most banks will offer similar deals

[uk]

my understanding of time deposit with bpi is that they are different than long term deposits as the term can be as low as 35 days but only up to 90 days  and minimum deposit of p10,000 but you can reinvest again after the 90 day limit.

[Lee2]

Just remember to spread out your deposits into more of the larger banks because they would only be insured for p500,000 and that is if the PDIC does not go broke. We use BPI and CitiBank Philippines but even those might not be fully safe. Stay under the insurance to at least try to play it safe.

Added, also remember that you will likely be dealing with the exchange rate changing. Years back I made a nice deposit into a 2 year term only to lose a bunch of money when it went up from p20 exchange to double that, all we can do is hope for the best and that is why I say that property seems to be more stable and income providing and doing that in the local currency.

[uk]

Just remember to spread out your deposits into more of the larger banks because they would only be insured for p500,000 and that is if the PDIC does not go broke. We use BPI and CitiBank Philippines but even those might not be fully safe. Stay under the insurance to at least try to play it safe.

totally agree with that
i think bpi and bdo are the safest banks here and also the one\'s with international links .eg Citibank,hsbc. but looking at what happen around the world last year who knows .(that felt strange saying last year) happy new year to all.

[Lee2]

Another thing that might be worth mentioning here is that over my 15 plus years of going back and forth to the Philippines, it seems that property values seem to follow the exchange rate to some degree. So back when we looked at a home when the rate was p20 to one dollar the home was a little over p1 million and later on when we went back to look at the same home a couple of years later when the rate was something like 38 to one the cost of the same house was now over p2 million, so I would say that property seems to follow exchange rates to some degree but bank deposits do not and a person can really get hurt if the rates change drastically or make out like a bandit if they go the other way.

I have tried to play the exchange rate over the years and have almost always lost. When we bought one condo unit we bought it on in house terms and the exchange rate at the time we put the deposit down was about 48.7 to one US dollar and I was getting over 5.5% in the bank on my retirement, so I figure I would go the free interest way for 2 years, well the following year came and I had to deposit the balance into our checking account to cover the balance of the next 12 checks we wrote and the exchange rate was now 42.5 to one and I took a bath. So from my personal experiences, I would say to make a deal when you can and then just go with whatever happens but I think playing the exchange rate can be a bad bet, but property over long term seems to be much more stable.

Anyone else wish to comment if they are or have found the same thing to be true?

[uk]

Added, also remember that you will likely be dealing with the exchange rate changing. Years back I made a nice deposit into a 2 year term only to lose a bunch of money when it went up from p20 exchange to double that, all we can do is hope for the best and that is why I say that property seems to be more stable and income providing and doing that in the local currency.

makes me think of the quote from all banks.
Past performance is not a guide to future performance. as the value of your investments can fall as well as rise and you may not get back the full amount invested.

[Lee2]

Added, also remember that you will likely be dealing with the exchange rate changing. Years back I made a nice deposit into a 2 year term only to lose a bunch of money when it went up from p20 exchange to double that, all we can do is hope for the best and that is why I say that property seems to be more stable and income providing and doing that in the local currency.

makes me think of the quote from all banks.
Past performance is not a guide to future performance. as the value of your investments can fall as well as rise and you may not get back the full amount invested.

exactly!

[uk]

for what it is worth my advice to anyone thinking of coming here to live is to open a bank account here now and set limits to what exchange rate you are happy with eg: 40 -50p to $/£ and only make money transfers to here when it is within said limits.
i had a bank account here before we came to live here as to me it make sense to me to have a local bank account as we came here every year for a holiday (the wife always had one here) then when we knew we wanted to live here full time we came over opened accounts with different banks and started making monthly transfers within our exchange rate limits to cover the cost of the house (which we were still looking for) this way we found if the rate was low one month we did no transfers .this may look like a risk to most as bank insurance here is only p500,000 (it was only p250,000 at the time ) but i believed the risk was no different than my home countries banks.
we also do the same now with our expenses we keep amount of money in our local accounts to last us a year here so when the rate is bad we have no worries when it is good we top it up.