Everyone reaches a certain age where he/she starts to think about what they wanted for their future, or how they could secure a comfortable living for their future self. For me, it came when I turned 22. It started with a thought, where would I be after 20 years or so. Am I married? Do I already have a family of my own? Where would I live? Would I still be an office worker? Questions like these and adding a bit of overthinking and worrying caused me sleepless nights. As in, literal 1-to-3-hours-of-sleep sleepless. Anyway, so, back then I did not know where to start. I do not have a bank account of my own, no savings and low income.
Fast forward to my 23-year-old self. I got a new job and the salary is higher than that of my previous work. One would think, since I have thought about my future plans and I have a draft of what I wanted in my mind, I would start investing/saving some of my money. But, no… I started to fall into the path of enjoying the money I have on things I do not need that much. With a mindset of “I’ll enjoy my money for a year, first, before I started investing.” I think this is okay, but do not sunk in too deep. Always be mindful of your spending habits. Because once you got used to it, it’ll be harder to put aside portion of your money to investments and/or savings. But, with the higher salary I am getting, I was able to setup my personal bank account. It is also advisable, for me, to setup another one with a different bank. Why I think this is ideal is because, the first account you could use for daily expenses and the second bank account is for your savings. As much as possible, do not touch the money on the second bank account.
After a year of merriment, I was once, again, bombarded with the thoughts I had when I was 22. Right then, I decided to get a house and lot first. One, I wanted to have a real estate investment because its value never decreases as years go by and 2nd is because I wanted my mother to have a house she could call her own when she gets back here in the Phillippines. I wanted her to stay for good this time (she’s an OFW in Riyadh). Anyhow, I was able to get my own house. Here in the Philippines, usually, a real estate agent would take you to what they call “trippings”. They would tour you around and show you model houses of subdivisions that you could buy. I did two trippings. On the first one, I have a house that I really really like, but unfortunately, it sold out. But then on the second tripping, I was able to find a house that suited what I was looking for. It’s relatively small, only 80sqm in total. It has 3 bed rooms and 2 bathrooms, enough for my mother, sister and I. Luckily, when we went for tripping the subdivision developers offered the introductory price for the house and I only need to pay 5,000.00php for the reservation of the house and lot unit.
Most young people get intimidated with buying a house of their own. Based on my experience, at first, I was skeptical weather I could afford buying it and I am a bit shy talking to a real estate agent. I didn’t know where to start. But thanks to the power of internet browsing and social media, I was able to find a Facebook page called Discounted Homes Of Pinoy. Where I found several units that fits my budget.
Okay, here’s the thing. For people who has no experience in buying a house or they don’t have someone to ask about the house buying process, they have a misconception that you have to pay the house down payment (which is a lot) right there and then when you decided to buy the house. Maybe it’s just me, but this is my line of thinking when I first thought about buying a house. Well, yes, for those who already have the money they could opt paying it upfront. But for people like me, who still lives paycheck to paycheck, there’s this option that you could pay for the down payment monthly, for several months then continue paying monthly amortizations to completely buy the property. The down payment usually ranges from 10% to 30% of the total property price.
There’re three options on how you could purchase it (well… here in the Philippines). First one is thru bank financing, where you would apply a housing loan for the accredited banks of your chosen developers. Bank accreditation varies from developer to developer and sometimes they do not offer bank financing at all. In case you’re wondering, what I call developers are the company/corporation/people who developed the houses on subdivisions. Examples are Camella, Filinvest, Lancaster, Enduraland, etc.. I am not sure what the bank loan eligibility requirements are, as I did not choose this option.
Next is through the Pag-ibig HDMF, this is the option I chose.Why? Because it’s government owned and I get to have an option of paying it for 30 years. Although, the downside to this is it has higher interest (accdg. to some articles) compared to the bank financing. “Oh, 30 years. That’s looong~” Well yeah, I’ll be 55 years old already before I could fully pay for the property. But hey, you could pay a lump sum once a year to the property’s principal amount which could shorten your payment period.
Last but not the least is the in-house financing, not all developers offers this. In-house financing is where you’ll pay the developer the monthly amortization instead of a third party lender. I do not know much about this because the developer I have doesn’t have this option.
At this age and time, it is better to prepare while you’re young in order to have the same lifestyle you have right now when future comes and live comfortably. There are a lot of options out there, do not be afraid to ask a financial adviser or a real estate agent and do some research on your part. I promise it’s worth it.
Disclaimer: Everything I say here are based on my thoughts, opinions and experiences. It may not be 100% accurate and not everyone would agree, but hey, It’s all about sharing. The feature image used is grabbed from google. I do not own it or whatsoever.
Also, please look out for part 2! Preparation For the Future: Insurance Policies