OFW Families Dependent On Remittances Have Now Learned To Save

Filipino households that depend on remittances from loved ones abroad are getting into the habit of saving, according to a recent Bangko Sentral ng Pilipinas (BSP) survey.

In their third quarter of the year survey shows 36.8 percent of households set aside portion of funds sent by their love ones working overseas.

Evaluating the trend since 2007, there are more and more households dependent on remittances that are into saving, according to BSP.

The increase in trending among OFW families left in the Philippines that are saving part of the money they receive from abroad was attributed partly to rising incomes that allowed family members to save more, and to improved financial literacy among Filipinos.

There’s quite an improvement in wages since five years ago from the host hiring countries in demand of overseas manpower for their domestic needs.

Besides, the new breed of OFW families have learned from the lessons of the past, early batches of OFW who spent most of their lives working overseas ended up with no savings set aside by their families upon their retirement.

The latest survey results also showed that in the third quarter of 2012, 4.9 percent of remittance-dependent households invested a portion of their money as compared to only 2.3 percent in 2007.

Investments could be in the form of purchases of portfolio instruments or establishment of micro-enterprises.

The BSP said it is promoting financial literacy through seminars on saving and investing in various parts of the country and in cities abroad where there are big communities of overseas Filipino workers.

According to National Economic Development Authority (NEDA), the Philippine economy is no longer that much dependent on OFW remittances starting last year of 2011, when gross domestic product (GDP) growth of 3.9 percent has been higher than its net primary income from abroad of just 1 percent.

Further it said, that overseas Filipino workers’ remittances assume a new role that could be a significant source of investment for the betterment of the country’s economy.

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