BDO’s Easy Investment Plan-Brochure

I’m feeling industrious to type away today so I’m posting some of the contents of BDO’s brochure on EIP given to us. Credits to BDO. And no, I was not asked to blog about it. I just want to.
“Don’t Just Save, Invest.”
Saving is, and always will be, the foundation of any fortune. It is secure, risk-free and readily accessible.

But saving alone is not enough to make your money grow. You should also invest. This means taking some risks, but the rewards are higher. When you save and invest, your money has the power to grow faster. So don’t just save, invest!

The BDO Easy Investment Plan (EIP)
The BDO EIP is a wealth build-up plan that enables you to attain your financial goals and financial wellness through the twin habits of saving and investing. It incorporates the best, tried and tested principles that make a successful saving and investment plan and provide a solution to counter the major obstacles to saving and investing.

Here’s how in just three easy steps:
  1. Fill out the EIP Application Form and enroll your BDO Savings/Checking Account in the EIP at any BDO branch.
  2. Decide on the following details of your contribution:
    • Amount: Minimum of Php1,000.00 per contribution
    • Frequency and schedule: Once a month (5th, 10th, 15, 20th, 2th or 30th) or Twice a month (every 5th & 20th, 10th & 25th or 15th & 30th)
  3. Choose what type of Unit Investment Trust Fund (UITF) is best for you: BDO Peso Fixed Income Fund, BDO Peso Balanced Fund or the BDO Equity Fund.
Once enrolled, the amount you have chosen will regularly and automatically be debited from your account and will immediately be invested in the UITF of your choice. Every time the market value of your investment reaches Php10,000.00 on a contribution date, this will spin off and be treated as a regular UITF investment documented by a Confirmation of Participation (COP). The cycle of saving, investing, spinning off from the EIP and issuance of COP continues for as long as you are enrolled in the program.

So with the EIP, saving and investing become a habit. It’s simple, it’s easy and it’s automatic.

Choose your Investment
Choose where your monthly investment will go.

BDO Peso Fixed Income Fund
A medium-term bond fund which aims to provide a high level of income with preservation of capital and maintenance of liquidity. This fund invests in a combination of short to long-term fixed income securities. The fund is suitable for risk toleranct investors.

BDO Peso Balanced Fund
The fund aims to achieve capital appreciation over the medium-term by investing primarily in equities and to some extent in fixed income securities, the allocation of which shall be determined by the Trustee depending on market conditions. The fund is suitable for risk-taking investors.

BDO Equity Fund
The fund aims primarily for capital growth over the medium to long-term by investing in a selection of exchange-listed equities. The fund is ideal for risk-taking investors.

The Perfect Opportunity
The time for investing is now. With the BDO Easy Investment Plan (EIP), it has never been easier.
Automatic savings and investment
The EIP has an auto-debit facility to regularly set aside funds for immediate investment.

Convenience
Enrollment  can be don in any of the BDO branches nationwide.

Flexibility
The BDO EIP is multi-purpose since it can be used for a variety of your major projects (i.e. education for your children, family vacation/s, special family celebrations, retirement). THis is unlike private and government pension funds and pre-need and insurance funds which can be withdrawn/distributed only upon retirement, disability or death.

Affordability
With a minimum of Php1,000.00, an investment can be made in the chosen UITF.

Professional Fund Management
Gain access to the services of BDO professional fund managers who keep constant watch over the BDO UITFs.

Cost Averaging
The BDO EIP enables you to benefit from Peso Cost Averaging, a time-tested personal wealth-building strategy wherein fixed amounts of investment in regular intervals over a period of time allow you to average your costs. This allows you to invest without having to constantly monitor the market. Any time is a good time to invest!

The BDO EIP is the perfect opportunity for you to invest. Rush to your nearest branch today.”

Well, that’s it. Now, your call :).

**Disclaimer: I’m not Financial savvy. I’m just sharing what I learned from the seminar. I hope to at least become financially literate though :). **

Gain or Loss?

As I posted earlier, my friend and I attended a seminar sponsored by BDO.
Here’s one thing that’s a new learning for me. The speaker showed the performance of one investment product. Sorry, I don’t remember which one and I don’t remember the exact figures as well. But for instance, we have these percentages of the investment product’s performance per anum:
  • Year 1 – 52%
  • Year 2 – (48%)
  • Year 3 – 63%
  • Year 4 – 37%
The question thrown to us was: did I regain my loss in Year 3 after its negative return in Year 2 and very high return in Year 3? The answer is NO. Here’s to illustrate:

Based on our example, our starting Principal for Year 2 was 15,200.00 but by year end, it dropped to 7,904.00. And although Year 3 yielded high return, the principal of Year 2 has not yet been recovered by end of Year 3. It was only on Year 4 that it was greater than Year 2’s principal.
Why a lesson learned for me? Because if I were to look only at the rates, it is always my impression that you recovered your loss by Year 3 because of the big jump in interest. However, the figures don’t show it. In some instances, perhaps it may, but not always.

**Disclaimer: I’m not Financial savvy. I’m just sharing what I learned from the seminar. I hope to at least become financially literate though :). **

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