5 Types of Savings for Every Filipino

5 Types of Savings Every Filipino Should Have (and Where to Keep Them) – I had my first savings account when I was 8 years old when my parents opened me a Junior Saver’s Account. It immediately made me feel like an adult.

A decade or two later, I have since then accumulated a few savings accounts for different purposes: daily needs, emergencies, investment, travel, etc.

While it’s convenient to keep all your money in one account, it’s not always the best idea. As we assume more responsibilities, it is better to manage savings and cash flow by placing your funds in several baskets.

Here are 5 Types of Savings for every Filipino–and where to keep them.

5 Types of Savings for Every Filipino – and Where to Keep Them

1 – Day-to-Day

This isn’t technically ‘savings’ for Filipino, but it is important to have a dedicated ATM savings account for easy access to your cash for daily transactions.

Here you can receive your monthly salary, pay your credit card and bills, and make ATM withdrawals for your daily spending.

Any surplus should be placed in another basket. Force yourself in a state of scarcity. If money is too easily accessible, it would be easy to spend too. (Read: How to be Frugal)

Set up circuit breakers. For example, if you do get sudden windfall: an annual bonus, a sales commission, a tax refund, an inheritance, put it away immediately in other savings in order to avoid spending it carelessly on impulsive purchases.

2 – Emergency Fund

Emergency funds cover for the unexpected: COVID-19, medical emergencies, unemployment, calamities, disasters, market, crisis, home repairs, major car fixes, etc.

As early as you can, set up your emergency fund by setting up a separate bank account. This is cash you should put away in case of emergencies.

The pandemic we all know now as COVID-19. It breaks my heart to see a lot of my friends on FB regret not setting an emergency fund before the enforced lockdown happened.

The textbook figure for an emergency fund is 6 to 9 months of salary, depending on how good you are at avoiding emergencies. If you’re single, healthy and employed, this is a good standard. However, if you are married, with kids, or have other financial obligations (supporting parents, supporting relatives, etc.), keep at least 12 months emergency fund.

3 – Opportunity Fund

So many articles and literature have been written about the value of having an emergency fund. However, have you ever thought about setting up an opportunity fund?

While the emergency fund helps you and your family keep afloat in your living expenses in times of emergency or crisis, the opportunity fund is for unlocking investment opportunities. The opportunity fund should be separate from your emergency fund.

There are plenty of opportunities during crises: undervalued businesses that are forced to sell because of depleted cash flows, foreclosed properties or discounted real estate, shares of stocks, funds, securities, and more.

When investing during a crisis, cash is king. Now is not the time to empty your emergency fund, to take a loan or second mortgage your home to invest in an ‘opportunity of a lifetime’.

Read: Investing and Earning during a Crisis

Even without crises, it is good practice to set aside another savings account for investment and reinvestment purposes. and opportunities.

4 – Short Term Savings

⁠Having an account to accomplish short-term goals protects your other funds from being touched.

Savings for the short-term plans, such as plans for an upcoming holiday to Bali, John Legend Concert, new gadget, or Christmas presents.

If you have ‘more ambitious’ short-term goals but not quite as long-term, e.g. a future wedding or planning to purchase a car or condo (mid-term goals?), you may place it in a separate account.

5 – Long Term Savings

Set aside savings for the long-term futurefunds separate from your emergency fund. Make different nest eggs for your retirement, for your kids’ college education, dream home, etc.

Where Should I put my Savings?

So where should you put your savings? The options are plenty: you can put it in an ATM savings account, a high-interest bearing savings account, time deposit, PAG-IBIG MP2 Savings fund, or a low-risk investment like an index fund.

ATM Savings Accounts are perfect for day-to-day transactions. This is where you handle daily cash flows and provide easy deposits and withdrawals.

High-Interest Bearing Savings Account. It makes sense to keep your emergency funds in high-interest bearing savings accounts. Digital banks do not have such high operational expenses, thus they can afford higher interest rates up to 4%. We recommend you to check CIMB and ING Philippines. (Read: Best Digital Banks in the Philippines)

PAG-IBIG MP2 Savings is a special savings facility with a 5-year maturity that can give you up to 7%. The dividend rate can be received annually or end term.

You can also place your savings in low-risk investment funds like mutual funds or index funds. Some of my savings are in ATRAM and Soldivo Funds, while my long term savings are placed in higher-risk vehicles such as Growth Equity Fund and the stock market. It is really up to you. You can mix and match according to your level of comfort, risk appetite, and preference.

Read: Mutual Funds vs. Stocks: A Newbies Guide

To know more about mutual funds: bit.ly/investing-ph


Personal finance is personal. It is ultimately up to the individual on how best you can manage your daily finances, lifestyle, healthcare, and investments for the future.

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