By: Marvin Germo | February 11, 2020
Investing Is Made Easy Now
Investing is easy nowadays. There are a lot of investment portfolios in the market—stocks, bonds, mutual funds, and so on. Everything is within your reach now. I’ve been talking a lot about the PAG-IBIG MP2 Program which is used by most Filipino investors. I’ve shared with you how to do it and the reasons why you need to open your account now. Today, I want to focus on its possible downside to give you another perspective on this investment. I hope this will help you decide to push through with your account opening or not.
Catch me in my live training events!(quick plug)
The heart of why I do these seminars is I want to build a generation of Filipinos with the right foundation in stock investing. I want to bring smart investing to every Filipino around the world! If you would like to know more about how you could time the market check out the training below.
Stock Smarts Taiwan – February 15, 2020
Stock Smarts Manila: March 14, 15, 21, 22 & 28, 2020
Stock Smarts Singapore: May 16 – 17, 2020
Stock Smarts New Zealand: June 6 – 7, 2020
Stock Smarts Sydney: July 11 – 12, 2020
Stock Smarts London: April 18 – 19, 2020
MP2’s Earnings Are Yearly
This can be a good indication but some investors will find it troublesome to receive yearly earnings from PAG-IBIG. One of the possible downsides of investing in MP2 is its ability to give out earning annually. Why do I think that this is a downside? Again, it depends on your preference as an investor. If you want earnings that you can receive per month, this is not for you. There’s also an option when you open your account to receive the dividends at the end of its maturity date. Basically, you have to wait for 5 years before you can handle your money.
The Dividend Rate Is Not Fixed
If you are looking for fixed-income investments, this is not for you. The MP2 program’s dividends are not fixed. Anything can change within a year. Every year, there is a recorded rate of dividend and it can be different from the past and future rates. So, if you want a fixed rate, you should not rely on what MP2 can give you. On the other side of it, it can go up and higher than the previous rate. It can also get lower but the exact same percentage that you received in the past.
It’s Possible Not To Give Dividends
It can happen—MP2 Program not giving dividends for a year. Again, there is no guarantee that you will receive higher or lower dividends. It all depends on the profit generated by PAG-IBIG for the year. If there are losses, the best value you can get is the original amount of your accumulated investment. That’s the worst risk you have to face when you invest in this program. If it happens in the future, you should still expect that PAG-IBIG can incur losses or zero income in the future.
I’m excited to share my 5th book overall and the 4th book in the Stock Smarts series,Stock Smarts: Breaking the Resistance – How to time your traders perfectly.The heart of this book is to teach you strategic ways on how to come in and buy and sell stocks in a way where you come as the market is headed up and come out as the market is headed down. The book is now out and exclusive viaMarvin Germo Book Orders.
For more details and toorder my other books:Marvin Germo Book Orders
HOW TO MANAGE YOUR BUSINESS FINANCIALLY
When discussing investing, especially in the context of diverse portfolios and specific investment programs like the PAG-IBIG MP2, it's crucial to comprehend the intricacies and nuances. The concepts intertwined in Marvin Germo's article are fundamental to investors seeking insights into this particular program. Let's break down the key elements:
Investment Portfolios:
- Stocks: Ownership in a company, with potential returns through dividends or capital appreciation.
- Bonds: Debt securities wherein an investor lends money to an entity and receives periodic interest payments.
- Mutual Funds: Pooled funds from various investors used to invest in stocks, bonds, or other assets.
PAG-IBIG MP2 Program:
- Earnings Frequency: The program provides yearly earnings, a potential downside for investors seeking monthly returns.
- Dividend Rate Variability: Unlike fixed-income investments, the MP2 dividends aren't fixed. They fluctuate annually, which can be higher or lower than previous rates.
- Possibility of No Dividends: The program might not provide dividends for a specific year based on the profit generated by PAG-IBIG. Losses could result in no additional income for investors.
Risk Assessment:
- Maturity Date: Investors must wait for five years before accessing their funds, which might not suit those seeking immediate liquidity.
- No Guarantee of Returns: The investment's performance depends on the profitability of PAG-IBIG, which might lead to no dividends or even losses.
Financial Education and Timing the Market:
- Live Training Events: Seminars aiming to educate and equip Filipinos with the right knowledge for stock investing.
- Market Timing: Germo emphasizes strategic approaches for entering and exiting the stock market with his book, "Stock Smarts: Breaking the Resistance."
Managing Business Finances:
- Book on Financial Management: Germo's book might provide insights into managing business finances effectively.
Understanding these concepts is pivotal for investors, allowing them to weigh the pros and cons of investing in programs like PAG-IBIG MP2 and make informed decisions aligned with their financial goals and risk tolerance.
