Contrary to many expectations that once a Filipino goes abroad and get paid salary higher than back home, many overseas Filipino workers go home barely able to save money.
Why is it so?
In ideal situations, a Filipino spends considerable amount of money on relocation expenses or paying agency fee on his first few months at work. After a few months, he begins to save money for the future. But in many cases it’s far from being ideal.
Unfair working contracts, exorbitant fees or even illegal recruitment sometimes hound our OFWs abroad. They struggle at work, unable to find sufficient rest time, enough food and lack protection when getting sick. So when his contract expires, he may not have enough savings even to pay for airfare. Worse, he may be in deep debt as loan sharks take advantage of his vulnerability.
High placement fees
Going abroad is sometimes like a gamble, where an OFW has to bet through expensive agency fees, deal with multiple levels of bureaucracy and sometimes unpredictable health condition. Once the OFW gets the clearance to work, she starts to think how much she can save monthly after considering debt payments and initial expenses. However, once she arrives at the work place, she realizes it is more expensive to live there and she therefore has to adjust her budget that her meager income is barely able to support. Other significant expenses include monthly long distance calls and money remittances. She could easily think that while she couldn’t save in the first few months because of necessary payments, but she may not realize that until the last day of her contract, she barely saved at all.
Spending above financial means
One problem of some OFWs is lack of fiscal discipline. Thinking that they have higher salaries abroad made them think they can buy anything they want. Expensive phone, check. Unnecessary laptop, check. Designer bags, check. Ridiculously priced jewelry, check. It is NOT bad idea to buy them, but only if they can afford them or have set aside an amount — no matter how small — for savings. These expenses are not investments which they can make money of. Mobile phone breaks down and needs to be repaired. Laptop gets infected with spyware and rendered irreparable. Owners end up spending more to maintain these devices. Hence, the savings accounts are sacrificed.
Overspending by beneficiaries
Sometimes family members of OFWs think that their brother or sister or son or aunt receives lots of money while working abroad that they spend remittance money like there’s no tomorrow. In the end they end up asking for more to finance their necessities. Sometimes it is thought that remittance will be an automated monthly bank transfer that when it does not arrive at usual date, family members borrow money from loan sharks, assuming that the money sent to them from overseas will be used to pay the debts.
Infidelity and extra responsibility
When an OFW gets involved in an extramarital affair to address his or her homesickness, he or she is also adding more in the list of people to support. Additional responsibilities often entail additional expenses. If the forbidden love bears a love child, money will also be spent on caring for the baby. Not to mention the trouble and scandal to expect when the OFW returns to legitimate family someday.
OFWs must be able to set ground rules for themselves and follow them religiously. This includes practices on saving money. If one can save a certain amount consistently in a month (ideally set aside this amount right after receiving salary) to bank account, SSS or other retirement contribution, this will definitely be helpful especially when times go rough.