Why Should You Get An Insurance (Part1)

     We Filipinos are not financially well off. Most of us are average income earner, many are poor and few are really rich. But I believe everyone has the right to become rich, or at least be financially stable. Sadly, only few are willing to explore and venture out.

      In fact, there are many vehicle to alleviate our income. I will share to you some of my knowledge on how to grow your extra cash higher than bank rates. But of course I cannot promise you, you'll get rich in an instant. But at least you are aware of what to do when you have extra cash. There's nothing you can lose. KNOWLEDGE IS POWER.

       Know why I choose insurance over other investment vehicle out there.

       Let me describe to you my understanding of the different investment vehicle. I might as well share some and maybe few of best blogs out there who make good explanation about investments.

First, let me enumerate these major investment vehicle:

- Mutual Fund (MF)
- Unit Investment Trust Fund (UITF)
- Bank Deposits
- Insurance
- Stocks
- Securities

1. Mutual Funds (MF). By definition, is a type of professionally managed investment fund that pools money from many investors to purchase securities. It is usually applied to those collective investment vehicles that are regulated and sold to the general public.

     
      In laymans, there is a so called fund manager who does all the research, selection and monitoring of the fund. The money you invested is also being invested in other securities like another mutual fund, stocks, government securities, etc. based on the study of the fund manager by which it will make profit over time. But of course it is not guaranteed.

        The fund is also liquid, you can withdraw it anytime with the corresponding NAVPU (Net Asset Value per Unit). Mutual fund works like UITF (Unit Investment Trust Fund) with few differences of course. I cannot really describe to you all of the differences between the two but I will share to you a very nice blog about the comparison of the two: Mutual Funds and Unit Investment Trust Funds, What's The Difference?

Next topic....
Unit Investment Trust Fund