13 Best Investments for Beginners in the Philippines:

If your goal today is to start investing for your future but you’re quite unsure where to exactly start, you’re at the right place. Investing doesn’t have to be scary, confusing, or complicated. In fact, investing as early as now is one of the best long-term moves you can make, especially if you have yet to achieve some financial goals or you’re a few decades away from retirement.

So, we’ve compiled a list of the 13 Best Investments for Beginners in the Philippines so you can kickstart your investing journey in no time:

13 Best Investments for Beginners in the Philippines

1. Time Deposit

This probably is the easiest one to understand in our list of the best investments for beginners in the Philippines. If you are someone who is risk-averse and has very little risk appetite, a time deposit is definitely for you.

A time deposit is a type of investment vehicle that is almost risk-free wherein it “locks” a specific amount of money in a certain period of time. These are available in your local banks and are sometimes called Certificates of deposit. These usually offer higher interest rates compared to normal savings accounts in exchange for not being withdrawn for a specified period of time. The “lock-in” period can range from 30 days, 60 days, 90 days, 180 days, and even up to 5 years or more, depending on your chosen bank.

Now, what if you want to withdraw before the end of the lock-in period? Your investment will be charged the corresponding penalty fees, depending on your chosen bank. So make sure that before you invest your money here, you won’t be needing it within the timeframe you have chosen. CLICK HERE to compare the time deposit of each bank in the Philippines.

2. GInvest through GCash

This next one is considered one of the best investments for beginners in the Philippines who don’t have much capital.

GInvest is the investment marketplace feature of the GCash App. With GCash Invest Money, you can start building your savings with just Php 50.00. That’s relatively a low initial investment compared to traditional investment platforms that request at least Php1,000 or more as the minimum capital.

As of this writing, GInvest offers the following funds:

  • ATRAM Peso Money Market fund
  • ATRAM Global Consumer Trends Feeder Fund
  • ATRAM Total Return Peso Bond Fund
  • ATRM Philippine Equity Smart Index Fund
  • ATRAM Global Technology feeder fund

And for as low as Php 50.00, you can experience how investing works without risking a huge chunk of your hard-earned money. Although in some funds mentioned above, Php 1,000.00 is required. GCash also makes it so much easier for us as we can manage all our investments within the app such as adding more capital, transferring them to a different fund, and redeeming our investments. Moreover, Smart and Sun Subscribers can also register their numbers in GCash, so it’s pretty cool that registering is not only limited to Globe Subscribers.

Convinced with trying out Gcash? You may register through this link.

3. Pag-ibig MP2

As defined by Pag-IBIG, their MP2 Savings Program is a voluntary savings program for those who wish to save more and earn higher dividends than the regular Pag-IBIG Savings Program.

It’s an investment for a lock-in period of 5 years which we can consider as a low-risk investment but with better-earning potential. After 5 years, you are given the choice to re-invest it for another 5 years or have it withdrawn.

Why is PAG-IBIG MP2 a good investment?

  • The minimum investment requires only P500 per month with no maximum amount implemented.  You can invest as much as you want.
  • It is backed up by the government, making it suitable for conservative investors because of its low-risk structure. Probably the worst case that could happen is that you would get back what you only have invested, minus the dividend, which is very unlikely. 
  • Earnings are tax-free
  • It offers high dividend rates. It has significantly higher and better rates than the regular savings accounts and time deposits.

To know more, read our full guide on everything you need to know about Pag Ibig MP2. You may also want to read our 4 Tips to make the most out of Pag-ibig MP2.

4. Unit Investment Trust Fund (UITFs)

UITF stands for Unit Investment Trust Fund and is a “pooled” investment scheme that is offered by, if not all, local commercial banks. In a layman’s perspective, all the funds from UITF investors are collected and placed in funds with specific investments structure, some of which can be invested in equities, treasury bills, money market funds, and the like.

How do you earn from a UITF?

  • You buy units or shares from the bank in exchange for the money you will invest.
  • The price of a single unit you buy is called the NAVPU which is the acronym for Net Asset Value per UNIT.  
  • Gains or losses are computed through NAVPU from the time you opened your UITF account to the time you close or redeem your invested money.
  • Every day, the NAVPU changes. There will be days when it increases while on other days, it fluctuates. This depends on the fund manager’s performance for that day. 

For more detailed calculations of how you can earn from UITFs, read our post: How to Invest in UITF Philippines

5. Mutual Funds

A mutual fund will always be one of the best investments for beginners in the Philippines. It is a pool of money from the public that is invested and is also called pooled or managed fund. Investing in Mutual Funds is very similar to UITFs which is mentioned above.

For a more in-depth explanation of how Mutual funds in the Philippines work, read our post: How to Invest in Mutual Funds Philippines.

Here are the differences between UITFs and Mutual Funds:

Best investment for beginners in the Philippines
Best investment for beginners in the Philippines

6. Stocks

A stock is an investment that represents a share, or partial ownership, of a company that is listed in the Philippines Stock Exchange. Investing in stocks is one of the best investments for beginners in the Philippines.

To help you understand stocks more, allow me to share a story:

Ali, Ben and Cid own a takoyaki business. Their company is a Private Company. It is a private company because the owners are only limited to a small number of people. All businesses usually start as private. Then probably after a few years, when business is doing great, they might want to grow more branches and expand.

But Ali, Ben, and Cid have limited capital for their expansion. So all of them decided to sell a part of their company to other people. They can do this by offering investors to invest in their business. Once people start investing in their takoyaki business, they will have the much-needed funds for expansion.

So, they ask their friend, Doug, to buy a part of the business. The money from Doug can be used to put up a new branch.

Now when their business thrives, the original owners, Ali, Ben, and Cid, will no longer get all the profit for themselves because they have to share a portion of it with Doug.

Now let’s say they want to put up a hundred more branches, meaning Doug’s money won’t be enough for the expansion. Hence, they need to gather more money from more investors. This is where their takoyaki business, which is a private company, turns into a public company. By being a public company, they have the right to sell part ownership of the business to the public and anyone who wants to have part ownership can invest money by buying shares.

This is where the stock market comes in.

stock market is a place where you can buy shares of public companies and become a part owner of those businesses.

How can I earn from the shares I bought?

  • Earn through Dividends- this is the income you get from these public companies is called Dividends. There are two kinds namely:

Cash Dividends – payments to shareholders are made in cash

Stock dividends -more shares are given on top of what they own

  • Earn through Capital Appreciation

Let’s say a share in Jollibee Food Corp (JFC) is currently worth around P300. So, if you want to be a part-owner of JFC, you need to pay P300 for every share you buy. But remember. The stock market has rules. Supposing that you need to buy 10 shares of JFC before you can be a part-owner. This means you need to spend P3,000 before you become a part-owner.

To learn more about How to Invest in Stocks in the Philippines, CLICK HERE.

7. Real Estate Investment Trusts (REITs)

Investing in real estate involves shelling out tons of cash because property prices are quite expensive. The good news is that real estate developers and financial institutions have implemented a solution to make property investing very much attainable to more people. This is why REITs are created.

Some REITs only require P1,000 while others require P5,000 and above.

So how do REITs make money? Similar to stocks, REITs are managed like a stock portfolio. REITs, on the other hand, rent out, lease, and sell properties. The company will collect rent income on properties they own. This is how they generate income, and out of this, they then can pay back investors through dividends. One of the benefits of investing in REITs in the Philippines is that they are required to distribute 90% of their annual income to shareholders.

Learn more about REITS in our post: How to Invest in REITs in the Philippines

8. Index Funds

If you feel that investing in the stock market is too risky, then try Index Funds as this is one of the hassle-free best investments for beginners in the Philippines. Some index funds only require P1,000 while others require P10,000 and above.

In a nutshell, Index funds are a diversified, no-fuss, and a low-cost means of investing in the Stock market. In addition, when you invest in Index funds in the Philippines, you are automatically invested in the Philippines’ TOP 30 Companies whose shares are traded in the Philippine Stock Exchange (PSE). This is because an Index Fund’s goal is to “mirror” the PSE index (PSEi).

The PSEI is a stock market index of the Philippine Stock Exchange which consists of 30 companies. To learn more about Index funds, here’s our ultimate guide on How to Invest in INDEX FUNDS in the Philippines.

9. ESG Funds

ESG investing is by far one of the newest investments for beginners in the Philippines. ESG stands for environmental, social, and governance investing, and is usually known as a form of investing that incorporates these three ESG factors in investment decisions. It is used interchangeably with the terms responsible investing, sustainable investing, ethical investing, and impact investing.

How important is ESG? The significance of ESG factors in investment decision-making was mentioned by Mr. Larry Fink, the Chairman and Chief Executive Officer (CEO) of BlackRock, with the following statement:

“Society is demanding that companies, both public and private, serve a social purpose. To prosper over time, every company must not only deliver financial performance, but also show how it makes a positive contribution to society. Companies must benefit all of their stakeholders, including shareholders, employees, customers, and the communities in which they operate.”

If you wish to know more about how and where to invest in ESG funds, read our post: What is ESG Investing in the Philippines?

12 Best Investments for Beginners in the Philippines

10. Personal Equity and Retirement Account (PERA)

A Personal Equity and Retirement Account or what we call, PERA, is a long-term voluntary retirement account that encourages Filipinos to save and plan for their retirement. You can enjoy tax incentives both from the amount contributed to your PERA and the income from the PERA investments.

Some advantages of PERA that makes it stand out from the other retirement plans are:

  • Tax Benefits
  • tax-free withdrawals
  • 5% credit on your income taxes 
  • tax exemption on 20% withholding tax on bank deposits, trust funds and deposit substitutes
  • Control over where to invest your retirement funds
  • tax exemption on 10% withholding tax on dividends
  • exempted on regular income tax on PERA products
  • exempted on capital gains tax on any stocks.

For a more detailed explanation of how PERA works, head on to this article: How to Invest in PERA (Personal Equity & Retirement Account).

11. Cryptocurrency

Cryptocurrency, or crypto, is a digital currency that is not regulated by any centralized system (e.g. banks) but rather by a decentralized one. Crypto is usually centered around blockchains or a database wherein all transactions are recorded across multiple servers. In a layman’s term, it is a virtual money and therefore, has no physical form. 

Some advantages Of Investing In Cryptocurrency In The Philippines

  • No Middleman
  • Accessible 24/7
  • Security and Confidentiality of Data
  • Hedge Against Inflation
  • Decentralized

For most cryptocurrencies, the value is determined by those who hold a majority of the value of a certain coin. Its decentralized nature helps ensure that no institution can manipulate its value.

RELATED POST: How To Invest In Cryptocurrency in the Philippines

12. WISP Plus by SSS

This is the newest program by SSS and stands for Workers’ Investment & Savings Program (WISP) Plus. Though it may not have any proven track record yet, SSS promises favorable returns. A few features of this savings and investments program are the following:

  • It is an affordable and convenient, and tax-free savings plan.
  • You can invest for as low as P500 every month or for any month(s) you deem necessary
  • Withdrawals can be made after the one-year holding period
  • In case of extreme hardships or emergencies, you can withdraw it within one year

Learn more about here: How to Invest in WISP Plus SSS: A Complete Guide

13. Invest in Yourself

Investing in yourself is definitely on this list of the best investment for beginners in the Philippines. It’s the best thing you can ever make for yourself, however, it is one of the major things in life that gets neglected the most.

Investing in yourself can massively help increase your well-being, knowledge and skills. Similar to your college degree, masterals, or any other form of education you have earned, investing in yourself is something that you cannot lose no matter what financial burdens or hurdles life throws at you – it will always be with you forever.

Read books, watch videos, listen to podcasts, find a mentor, talk to people with wisdom and those who have had actual experience. Of course, don’t forget to try out new things and delve into these with calculated risks.

Sometimes, you might find yourself thinking that investing in yourself might feel time-consuming and like a waste of time. This probably stems from knowing that your time spent investing in yourself is also the lenient time you don’t make money.

But remember this:

Whatever room for improvements you do for yourself, be it learning a new skill or learning how to grow your money exponentially, WHATEVER YOU LEARN WILL ALWAYS BENEFIT OR COME IN HANDY FOR YOU ONE DAY.

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13 Best Investments for Beginners in the Philippines

By Ameena Rey-Franc

Recognized as one of the Top Finance Blogs in the PH. Ameena Rey-Franc (founder of TTP) is a former Banker and BS Accountancy graduate turned Blogger, Keynote Speaker, and entrepreneur. Currently an RFP delegate, she is also the Author of a book about Financial Resilience and has held seminars for reputable companies like GrabFoodPH, Pru Life UK, VISA, JPMorgan Chase& Co., Paypal, Fundline, Moneymax, and many more. The Thrifty Pinay's mission is to empower women to LEARN, EARN, and be FINANCIALLY-INDEPENDENT no matter what life stage they are in.