Overseas Filipino Workers' Management of Financial Resources

Abstract

Year after year, the number of Overseas Filipino Workers (OFWs) continues to increase. Based on the result of the survey on overseas Filipinos of the Philippine Statistics Authority (PSA), the total number of OFWs estimated at 2.2 million. With the continued deployment and employment of Filipinos in jobs abroad, it is no wonder that remittance continues to rise. For the year 2017, the situation of overseas Filipinos’ remittances based on the Bangko Sentral ng Pilipinas (BSP) report, indicated the growth rate of Overseas Filipinos’ Cash Remittances by 4.2% for the period of January to April 2017. Money repatriated by millions of working Filipinos abroad last year was already at $26.8 billion, making the Philippines the third biggest recipient of recorded money remittances in the world, next only to India and China. Moreover, earning in foreign currencies allows greater purchasing power for Filipinos, and supposedly, a larger opportunity to save and invest, however, based on the PSA survey relative to the distribution of OFWs cash remittance set aside for savings for the latest year update 2016, a total of 2,240 merely save. Every now and then, we hear success stories of OFWs who became successful and were able to save and invest from their hard-earned money. While some people actually became rich after laboring their years as workers overseas, some Filipinos come back empty-handed. Hence, managing financial resources is one of the aspects in life that should be taken due consideration because lack of personal financial knowledge limits personal financial management and may cause financial problems, that in turn become their personal challenges. The study evaluated how Overseas Filipino Workers manage their financial resources; how they allocate their resources through determining their profile, and their level of importance in managing financial resources such as budgeting, investment, and disbursement. Review of literature was made with the following topics: 1) Challenge; 2) OFWs; 3) OFWs Household; 4) Financial Resources; 5) Management; 6) Budgeting; 7) Investment; 8) Disbursement. The theoretical framework utilized for this research study was the Theory of Personal Financial Planning, Goal-Setting Theory, and Behavioral Life-Cycle Hypothesis. The survey was conducted on March 2018 in Philippine Overseas Employment Administration, Central Office in Metro Manila, Philippines. A self-made questionnaire was used, using a Likert scale to measure the level of importance of managing financial resources of OFWs. There are a total of 385 sample respondents gathered by means of Purposive Sampling Method. The study found out that most respondents were aged 31-40 years old, most were male, single or married with one dependent and attained the college degree, having 1 to 2 years of experience abroad and earned below Php50,000.00. The study concluded that regardless of the profile of the OFWs, the level of importance of managing financial resources for them is important. However, OFWs should continue to enhance their knowledge and continuously improve financial practices in line with their goals.