Don’t Put Your Retirement Fund in the Bank

For this post, I’d like to borrow Bo Sanchez’ Chapter 30 story of the ‘8 Secrets of the Truly Rich’ that differentiates the spender from a saver and from an investor. According to that chapter, there were three (3) salesmen, James, Jim and John. The three of them got a big sales and therefore each received a hefty Php 100,000.00 commission each. Also, each of them had different plans for the amount that they received.

James was the Spender. After receiving his cheque, went straight to the bank, quickly got his money and treat his friends to a restaurant. The next day, he bought himself the newest Nokia cellphone, bought clothes and a new pair of the latest Nike shoes. The next day, went straight to a travel agency and had a vacation in Boracay. In 3 days, his Php100,000.00 was all gone. It even left some unpaid bills in his credit card.

Jim was the Saver. After he got his cheque, went straight to the bank, talk to the bank manager. “I’d like to open a time deposit for my Php100,000.00 commission, how much interest can you give me”? The manager replied, “We’ll give you 5% interest per year, Sir. That’s the highest that we can give”.

Thirty-six years later, he was 65. Got his retirement package, spent it in five years until he was totally broke. Then he remembered having a Php100,000.00 deposit. He then get to the bank and met the same bank manager. “Miss, 36 years ago, I’ve deposited P100,000.00, I’m sure that has grown much bigger now. I’d like to withdraw my money”. The manager gave him a cheque amounting to P400,000.00. “Miss, that was 36 years ago, there must be some mistake?”. “No, Sir. That’s all there is. And excuse me, di na ako Miss, Lola na ako”.

John was the investor. After receiving his cheque, he didn’t go straight to the bank. He goes where the bank invests their money. In other words, he bypasses the bank. He had already made some researches about mutual funds and visits one of the mutual funds company in the Philippines.

“Miss, I’ve never done this before but I’d like to invest my money in mutual funds, how much is the interest?”. The person then replied, “Unlike banks, we don’t guarantee our interest rates. They depend on the ups and downs of the market”. “Isn’t that scary?”, John asked confusedly. “It is, if you plan to save for a short period of time. But if you plan to invest long term, like for the past years, we’ve given our investors 9-12% average growth. “Yes, I do plan to invest in the long term, but I don’t have millions!”. The girl laughed. “Sir, the minimum is Php5,000.00.” So he invested his Php100,000.00 and left happily.

They say that the Philippines is 30 years behind of USA in terms of financial literacy . In the US, 70% of the people have already investments in mutual funds and only 30% in the bank. In the Philippines, 99% still invest in the bank and only 1% invest in mutual funds.

Thirty-six (36) years later, John is now 65 years old and now wanted his investment back. He went straight to the Mutual Fund company and approached the lady. “I’d like to get my investment 36 years ago, how did it go?”. The lady replied, “To be honest, there were bad years and good years. There were years your money only earned 7% and there were great years where it earned 20% and more. In the past 36 years, you averaged 12% per year.”

Confused, he asked, “Is that good?”.

“According to my record”s, she smiled, “your original Php100,000.00 has now grown to Php6.4 million. Isn’t that good?” “That’s very good!”, John replied happily.

Looking back at the story, now we know why Makati CBD is mainly composed of tall buildings of who? Banks. They are making a large amount of interest out of our own money. Imagine, having Php100,000.00 in 36 years, investing in mutual funds, they get Php6.4 million and how much do they pay us, only P400,000.00 while earning Php6 million out of it.

For a complete list of mutual fund companies, visit or you may contact me for information how to invest in mutual funds.

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Garry Zaldy de Castro is an advocate, Financial Advisor, Certified Investment Solicitor (Mutual Fund Representative), blogger, IT practitioner, husband to Aileen and a dad to Jacob and JohnD. He started Financial Planning Philippines in 2008 just to share his financial learning to friends, relatives and anyone who wishes to be financially independent.


  1. Hi Garry I am interested in mutual funds. Do you know of any reliable (you vouch) fund manager living in Cagayan de Oro City so I can go and talk to him/her because I also live in CDO.



    1. Mutual fund representative you mean? Ang fund manager kasi don’t assist in mutual fund applications, they only manage the investment of the funds. Email me your contact details so I can give it to a fellow MF Rep in your area.

  2. Sir pwede nyo po bang e-mail sa kin kung saan mutal company ang magandang maginvest ng hard earn money. Thanks

  3. Hi Abet,

    Glad you asked. To be able to invest in mutual funds, you may directly go to the mutual fund company, ask for their requirements and that’s it. Just make a regular deposit and let your fund grow.

    Go to and check which Mutual fund company you’d like to invest in.

    You may also contact me at 0922 8978077 and I may be able to help with the mutual fund company that I represent myself.

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