How the insurance industry made me start funding my retirement at the age of 22

I started my career in the insurance industry as a Recruiter. But when you are a Business graduate, hearing sales people discuss their experiences mixed with your own product knowledge stirs your curiosity and makes you yearn for more. Back when I was working as a sales recruiter for a real estate company, I used to think that selling insurance was just selling paper with written promises and investing in stocks was as good as high-stakes gambling in a casino. I thought these things were only for high rollers. But now I am thankful for the stint I was given in both banking and insurance. I fell in love with these industries. I fell in love with the idea of investing. I was in Human Resources for almost 3 years, afterwhich I took the bold risk of transferring to Sales. Yes, I sell insurance. It's my part-time profession. We have this inside joke in the agency- "How many friends have you lost since you came here?" But I have no regrets because I would not have learned these important things I know now.

1. Filipinos have an odd retirement plan

I'm glad that at this day and age, Filipinos are starting to appreciate investments. I observed Baby Boomers used to have (some still do) a strange mentality. When my grandmother was alive, I remember asking her her greatest regret. She said it was having only two children. I asked her why. Ladies and gents, it was because my lola had a retirement plan similar to many individuals from her generation. Their retirement plan was their children. She said if only she had five children, she could have just lived with her most well-off child. At least one would have migrated overseas and she would have had the luxury of being petitioned. My lola was not a college graduate. She claimed she knew nothing about finance. As a homemaker and wife of an OFW at the time, she was good at budgeting but the thought of having an insurance or investing never crossed her mind. When both of my grandparents retired, they were both fully dependent on my parents. It was not a bad thing because it is in our nature as Filipinos to be family-oriented. We are not normally the type to send our elderly to retirement homes to be cared for by paid professionals. But it is just sad when your children are also providing for your grandchildren, and your retirement dream cannot be their priority as much as they want it to be. My dad was also a non-believer, but when his business hit rock bottom at one point in his life and he realized that his future SSS pension cannot even fund his monthly buy-in at poker tournaments, he started investing. It kind of scared him that living off his pension could never take him on his retirement dream of hopping on a plane to Vegas with mom. He now has 3 insurance policies. He is my greatest supporter (even bought a policy from me) and seeks my help about equities and other investments. He tells me 15 years from now he wouldn't even need me to provide for him when he retires. I don't tell him I still will because what kind of ungrateful daughter neglects her parents? I started setting aside money for long-term investments at the age of 22, not just for myself and future family, but for my parents. I don't tell him because I'm not rich. Not yet.

2. We need more people to promote financial security

In my trainings I have learned that in the U.S. around 90% of Americans are insured. In the Philippines? A pitiful 17%. Why? We have this common misconception that getting insurance is like funding your own death. I find it funny because this is not stone age. We all know by now that everyone dies. If you are a breadwinner or significant contributor in your household, income protection is the relief you can provide to the loved ones you will leave behind. Besides, you do not have to die to get your money. Life insurance is flexible- it could be for your health, education of your children, savings for the future or better yet for retirement. Insurance companies now have investment-linked products that could help your money grow. This is a good alternative if you are not investment-savvy enough for stock trading but want high-yield investments. This 17% I plaster on the walls of my mind because it challenges and drives me to spread awareness. When this increases in the years to come, I know I made a contribution, even if it's only say, 0.0000001%.

3. The value of the money you have in the bank right now will not have the same value ten years from now

You think the 1 million pesos you safe-kept in your savings account will have the same value come the time you are married and have 3 children? Time to rethink. Your savings account is a low-risk, low-return investment. Banks usually give an interest rate of less than 1%. If you are not aggressive enough to invest your money in something as volatile as the stock market, learn about other moderate options like bonds. When I attended Bo Sanchez' financial wellness seminar, I learned that the inflation rate in the Philippines ranges from 3-4% every year. College tuition fees may increase an average of 10% a year. If you have 3 children aged 2, 3 and 5, start computing the college fund you will need to send them to good schools. Will you be content if your children passed the entrance exam in top universities but you choose to send them to community college because you cannot afford it?

4. Diversification is key
It's good when you can call yourself "rich" because you are liquid but I believe your entire net worth shouldn't be in your bank account. You should have a steady stream of income, savings, properties, businesses, paper investments such as stocks, bonds, time-deposits, mutual funds etc. I'm not saying you need to have all, just make sure you don't put your entire life savings in one investment. I cringe whenever I hear people putting millions into multi-level marketing and wonder how their money's gone with the wind. Investing has no guarantees- you can always lose money. There is no such thing as elimination of risk, you can only minimize it. So make sure to diversify, diversify, diversify.

I am not an expert in these things. I am an aspiring rookie and I would be glad to hear what others, especially seasoned advisors, business tycoons and investment gurus have to say about my opinions. But personally I realize I did not enter this industry to bag a lot of money. I am here because I have seen many people who cannot keep their lifestyle after 60 because they never understood the concept of inflation and thought that their one-time only 7-digit retirement pay can give them a comfortable retirement. I am here because when my grandparents died, we learned that a decent casket costs 6 digits, on top of all the expenses to place that casket inside a funeral home. I'm here because 5 years ago, my uncle passed away and left 6 minor children with nothing to start with. And I watched my cousin quit pursuing her engineering degree to get a night job at a call center so she can send her 5 younger siblings to school.

So whenever I feel like I don't have it all together, I just try to remember that at the age of 23 I'm contributing to gradually change the Filipino mentality by being an advocate of financial literacy. Get insured. Start investing early. Many of us were not born rich, but it is nobody else's fault but ours if we remain poor. Even if it comes to a point that I can no longer continue "selling", I will always preach about this.

As a salesperson (I am very guilty of this), I do not take my numbers very seriously (at least not the closed sales part). I don't force myself to have a sale at the end of the week. My goal is not to sell. The objective is to be heard, my goal is to educate. I make sure I talk to as many people as possible but I never make them feel like they are obliged. I just want to help people become financially aware. I never sell until they walk up to me and tell me that they need it. People say I could become a trainer or financial wellness speaker instead. I think many of us graduates from reputable universities have already realized by now that there are many things that can never be learned inside the classroom. I want to be out there practicing what I preach. Besides, it's not bad to earn a lot while educating at the same time, right? Live for your passion. Make a living out of your passion. Reach your goals and secure your future. But may it be money, time, or feelings - always remember to invest wisely.