Educators urged to invest in mutual funds

CEBU, Philippines - Teaching professionals in a private university are urged to consider investing in other financial instruments such as mutual funds rather than just totally spending their income or let their money sleep in the banks.

The University of San Jose-Recoletos (USJ-R) Faculty Association (FA) Inc. together with the Colayco Foundation for Education (CFE) Inc. recently conducted an investment seminar dubbed as “Pisobilities” last April 20 at the Center for Performing Arts, USJ-R Main Campus.

Designed to promote financial literacy, the three-hour seminar  aimed to equip USJ-R teachers with the right mindset and the motivation to build their wealth through other alternatives of investing their hard-earned money other than just spending.

It discussed topics on financial planning, personal investing, fundamental money transactions and types of investments.

Speakers included CFE founding chairman and finance guru Francisco Colayco and CFE managing partner Guita Tolentino Gopalan.

Roberto Cabardo, who currently heads the university’s faculty association, said that the existing initiative of lay and religious administrators to conduct seminars on financial literacy is intended to provide an avenue for teachers to be oriented on how to save, invest and grow their money accordingly.

He added that even if they are paid with a substantial amount of compensation for their job, professors still tend to apply for loan since they do not save for their future and they spend more on their wants rather than what they basically need.

He cited that 90 percent of the teachers in the university are members of the multipurpose cooperative for all USJ-R employees, thus allowing them to earn rebates.

He said, however, that only five to ten percent are involved in investing in other financial instruments.

To date, there are over 400 members of the faculty association. Over 100 teachers attended the seminar.

Cabardo said that the lack of awareness, low savings rate and pre-budgeted salaries prevent the rest of the faculty members to do the same.

“It is common among professionals to be close to the idea of investment and financial management. Not all of us are aware that we could begin in the safest way such as mutual funds,” he told The FREEMAN.

He further noted that although teachers have the capacity to invest, it still entails the willingness  and  knowledge on where to invest.

“We feel that it’s really time to invest. We have the money to invest, I admit, but it is still our choice to invest or not. We have this tendency to spend more than what we should,” he added.

He also revealed that more seminars and trainings on financial planning for teachers and non-teaching personnel in USJ-R and even in other schools could be expected in the years ahead.

In earlier reports, USJ-R implemented a tuition fee increase of ten percent that will take effect in all year levels starting this June.

Seventy percent of the collection of the tuition increase will be allotted for faculty salaries while the remaining 30 percent will be utilized for improvement on school facilities and fair return on investments for owners of the Catholic private university.

Cabardo cited that chances are higher for teachers to be more encouraged to invest taking into account the tuition fee increase.

USJ-R College of Commerce Dean Edgar Detoya, who is an existing investor of mutual funds, advised his colleagues to consider other financial instruments rather than letting their money sleep in the bank and grow less than one percent.

He added that first-time investors need not worry in managing their investments since there is a professional funds manager who could assist them.

He also cited that a simple and disciplined lifestyle is an ideal way to start being an investor.

Meanwhile, Colayco noted that it is typical for the middle-income earning class to earn and spend their salary and tend to save if there is still money left after the expenditure.

He said that it is the right time to change such mentality and dedicate a particular amount for savings and investment in the future.

He then encouraged USJ-R faculty members to invest their money based on a long-term goal and properly manage risks in order to achieve desired average returns.

He further suggested mutual funds as a recommended financial instrument where one can invest in a minimum amount of P5,000 and eventually add an increment of P1,000 daily or monthly as preferred by the investor.

He said that mutual funds pool the funds of individual and institutional investors to form a massive asset base which are then entrusted to a full-time professional funds manager who develops and maintains a diversified portfolio of security investments.

These could be classified into stock funds, balanced funds, bond funds, and money market funds.

Ideal for medium to long term financial goals, mutual funds, he explained, could help an investor earn an average annual return of eight to 20 percent.

“It is an obligation to be wealthy. You just have to have the discipline to save and know where to put your money. The greatest way to get rich quick is to get rich slow,” he concluded. /JMD (FREEMAN)