Académique Documents
Professionnel Documents
Culture Documents
In partial fulfillment
of the course
In General Mathematics in the Modern World (S11)
Submitted by:
Dionisio, Geryco Eugynn T.
Submitted to:
Mrs. Clarence Gatchalian
Introduction ..................................................................................................................................... 3
Problem ....................................................................................................................................... 3
Plans of Action................................................................................................................................ 5
1. BDO ................................................................................................................................. 5
2. BPI.................................................................................................................................... 6
1. BDO ................................................................................................................................. 6
2. BPI.................................................................................................................................... 7
Loans ........................................................................................................................................... 8
1. BDO ................................................................................................................................. 8
2. BPI.................................................................................................................................... 9
1. BPI.................................................................................................................................... 9
1. BDO ............................................................................................................................... 12
2. BPI.................................................................................................................................. 13
1. BDO ............................................................................................................................... 14
2. BPI.................................................................................................................................. 15
1
Other Discussions ...................................................................................................................... 16
Summary ................................................................................................................................... 17
Conclusion................................................................................................................................. 17
References ..................................................................................................................................... 18
Appendices.................................................................................................................................... 19
List of Tables
2
Introduction
Financial plans are plans that people make to create ways for them to be able to reach a
certain goal, and that goal is called a financial goal. This is a financial plan that is to be used by
the author after five years, assuming that the prices of each of the financial products are the same
rate as now. This financial plan will show the people who will read this how the author will
invest money to be able to reach a goal, which is a brand-new car. The author must raise around
Php250,000 to be able to reach his goal. The amount of money to be raised is different from the
money that the author will save, it is just an additional income.
The purpose of this financial plan is to show readers how the author creates ways in
invest his money in order to reach his goal.
Problem
The author needs to earn around Php250,000, which is not a small amount especially for
people who are still starting to work, and in just a short span of two years. Inspired by the goal,
the author seeks different ways to invest his money to reach that extra Php250,000.
3
Table 101
The table below shows the monthly income of the author. It also shows the approximate
expenses of the author monthly and how much he is able to save after deducting his monthly
income from the monthly expenses. The financial goal is also stated below and it is basically
because of the goal that this whole financial plan was made.
4
Plans of Action
There are several ways on how you can raise your money. The best examples are savings
account, stocks, loans, and etc. The author researched different banks and the different rates that
each of the financial products they offer. Below are the financial products that the author chose
for him to be able to reach the financial goal.
Savings Account
Savings is the safest and simplest way to earn money. It is known to return only a small
amount of interest, but it is guaranteed to be safe as compared to other ways to earn money. The
tables below show the offer of the two banks (BDO and BPI) in their savings account.
Minimum Initial Deposit Minimum Balance to Earn Gross Interest Rate per
Interest Annum
5
2. BPI Savings Account
Table 2.2 : BPI Savings Account
Type of Deposit Minimum Balance to Interest Rate Required Initial Required Monthly
Account Earn Interest Deposit ADB
Time Deposit
Time deposit is a lot like a regular savings account, but time deposit requires a higher
initial placement and has different rates depending on the amount of the money a person deposits
and how long the money stays in the bank. The tables below show the time deposit offers of the
two banks (BDO and BPI).
6
P50,000 to P99,999 1 month 0.375%
7
Loans
Due to the short span of time needed for the money to be big enough for the author to
reach the financial goal, loan might be the last resort of the author. Loans allow people to borrow
money from the bank, but borrowing from the bank is not simple, because one has to pay the
bank with an interest charged depending on how long it takes before one is able to pay the full
amount of the money borrowed. The following tables will show the different rates and
requirements of the two banks (BDO and BPI).
1. BDO Loan
Table 4.1 : BDO Personal Loan
Filipino citizen or foreigner residing in the Philippines for more than two (2) years
Must be 21 years old at time of application but no more than 70 years old upon maturity
Minimum Gross Annual income
o P120,000 for Salaried Employees
o P400,000 for Self-Employed / Professionals
Additional application requirement for Salaried Employees
o Must be at least one (1) year tenure with the company
Additional application requirement for Self-Employed
o Must be a sole proprietor or majority part-owner of a company operating for at
least two (2) years.
Additional application requirement for Professionals
o Must be in private practice for at least one (1) year
8
2. BPI Loan
Government-issued photo-bearing ID
3 months original pay slip and/or Latest Income Tax Return with BIR or Bank stamp
(BIR Form 2316)
9
BPI Investment Funds
Moderately Conservative
Moderately Aggressive
ABF Philippines Bond Index Fund P10,000.00 P1,000.00 0.08% (Trust Fee)
Bond Index 0.186% (Mgmt Fee)
Fund
10
Summary of Financial Products
BDO
Savings Account
Minimum Initial Deposit Minimum Balance to Earn Gross Interest Rate per Annum
Interest
0.25%
P5,000.00 P10,000.00
Time Deposit
P100,000 to P499,999 1 month 0.500%
2-3 months 0.500%
6-12 months 0.750%
Personal Loan
Tenor Factor Rate Monthly Add-on Rate Effective Rate / Annum
6 0.179667192 1.30% 26.27%
12 0.095836960 1.25% 26.63%
BPI
Direct Savings Bank
Type of Deposit Minimum Balance Interest Rate Required Initial Required Monthly
Account to Earn Interest Deposit ADB
Time Deposit
Amount Time frame Interest
P10,000-P49,999 1-12 months N/A
P50,000 - P999,999 1-3 months 0.625%
6-12 months 0.875%
P1,000,000 to P4,999,999
6
1-3 months 0.750%
6-12 months 1.000%
Money Market Fund
Minimum Minimum Trust Fee Minimum Minimum Minimum
Investment Transaction Holding Investment Transaction
Amount Period Amount
11
Data Analysis and Discussion
The tables below will be showing the computations of the time deposits for the two banks
above.
1. BDO
12
2. BPI
Comparing the interest earned from BDO and BPI, the one with the higher interest earned
is BPI. The interest earned from BDO is only Php1,551.29, while the interest earned from BPI is
Php1,806.30, which is Php255.01 higher.
13
Choice of Action : Loan
As we can see, even after depositing in time deposit for two years, the financial goal of
Php247,200.00 is only deducted by Php1,806.30, which leaves Php245,393.70. The time deposit
only made 0.73% of the financial goal, which leaves 99.27%. There is no faster way to get that
money than loan, especially in a short amount of time. The author decides to just borrow money
from the one of the banks so he can immediately reach his financial goal. The money that needs
to be borrowed is Php245,393.70.
The tables below show the rates of payment that the author plans to pay as he borrows
from the banks.
1. BDO
Starting
Balance Php245,393.70
Term (Months) 12 18 24 36
14
2. BPI
Starting
Balance Php245,393.70
Term (Months) 12 18 24 36
Comparing the loan that needs to be paid among the two banks, the rate that the author
must pay is lower in BPI than in BDO. The difference to be paid is among Php2,000 to around
Php4,000, starting from 12 months to 36 months. The author chose BPI because the amount that
he will be able to save is even higher than the amount of interest he earned after investing his
money in time deposit. Also, the interest rate of BDO is 1.25%, while the interest rate of BPI is
1.20% only, that 0.05% is a big difference especially for larger amounts of money.
15
Other Discussions
As shown in the table above, it is really hard to earn money when one is not willing to
risk much. Stocks would be a really good way to earn money quickly, but it is also really risky.
Even the best companies can have its stocks be in downfall constantly. Stocks are really
unpredictable, which means that if one is not willing to risk, then one should not invest in stocks.
As for bonds, the author thought that it is not advisable to invest in bonds when one needs
to earn a huge amount of money in a short amount of time. Money market fund, in the author's
opinion, is on the same level of risk as stocks, because both financial products could have their
prices change a lot in just a short amount of time.
The author decided to stay in the safe path, that is why he invested in time deposit
although it returns only a small amount of interest.
16
Summary and Conclusion
Summary
All of the researches of the rates of the different financial products of the banks was for
one thing, the financial goal, which is to buy a brand-new car. This paper showed a safe way of
obtaining around Php250,000.00. To earn more, one must risk more, but because of the lack of
experience of the author, he decided to just stay in the safe path to ensure the prevention of net
loss.
Below are the steps that the author will do in order to reach his financial goal, which is to
buy a brand-new car.
1. For two years, limit the expense to helping pay rent in the house and for necessities only.
The monthly savings must amount to at least Php14,500.00.
2. For every month, the savings must be deposited to BPI Time Deposit, which will allow
the author to earn an interest of Php1,806.30 at the end of the two years.
3. Lastly, loaning the amount of Php245,393.70 in BPI in order to reach the financial goal.
The amount of loan will be paid using the monthly savings that the author will earn in his
job five years from now.
Conclusion
To conclude, the author must be able to budget his money correctly, make sure to deposit
in the time deposit monthly, and pay back the loans (Php245,393.70) he borrowed from the bank.
The financial goal is not impossible to achieve as long as the steps above are followed without a
problem.
17
References
Peso Passbook Savings Account | BDO Unibank, Inc. (2019). Retrieved from
https://www.bdo.com.ph/personal/accounts/peso-savings-account/passbook-savings
https://www.bpiassetmanagement.com/pages/bpi-money-market-fund
https://www.bpiassetmanagement.com/pages/bpi-investment-funds/
https://www.bpiexpressonline.com/p/0/87/time-deposit-rates
18
Appendices
19
Month 13 Php14,700 Php13,170 Php171,210
20