7 financial mistakes people regret after retirement

RETIREMENT means no stress, no pressure, and no worries. It depicts bliss, fun, and freedom—but not when you’re in a bad financial situation.

or worse, borrowing money that will leave them in great debt.

7. I regret disregarding health and medical plans.

to ask for it”, said Commissioner Romeo D. Lumagui.

Per Revenue Regulations (RR) No. 10-2019, the BIR Notice to the Public must be prominently displayed within the seller’s place of business in an area visible to the public, including all its branches and mobile stores.

All registered business taxpayers asking for the replacement of their old “Ask for Receipt” Notice are required to update their registration information before the release of NIRI. A designated official company email address shall be required, which BIR shall use in serving its orders, notices, letters, communications, among others, to taxpayers.

“All sellers, whether operating online or offline, must adhere to the requirement of issuance of receipts/ invoices for every sale of service/ goods, as mandated by our existing laws. Failure to comply with the said requirement will result in the imposition of penalties or other legal consequences provided under the Tax Code, as amended,” said Lumagui.

A bad financial situation is the consequence of decisions made in the past. There are financial decisions that seem to be okay at the moment but may hurt in the long run—worse is when there’s just no way to get out of it. Nonetheless, we all learn from mistakes, don’t we?

So before you hit retirement age, avoid and learn from these seven common financial mistakes that most retired people say they regret.

1. I regret overspending.

Too much of anything is never okay, especially when it comes to spending. Whether you are earning above-average salary or just enough for your credentials, your spending habits have the biggest impact on your financial success.

Spending more money on mere wants, especially those that you can’t afford, is never a good idea. The problem with overspending is that you’re wasting money — money that you could have set aside for savings or investments.

2. I regret living from payday to payday.

Another habit that gets in the way of controlling your money is living from payday to payday. A lot of people find it hard to make ends meet just because of poor budgeting, and essentially, they do not know how to save money. You have to remember that your financial future depends on what you are doing right now. Start by creating a budget that will help you figure out how you can make the most out of your income, then track your spending to make yourself aware of where your money is going.

3. I regret living on borrowed money. Do you have too much plastic in your wallet? Do you get payday or salary loans all the time?

Credit cards and payday loans are the most common culprit in digging yourself down the debt grave. Do realize that any kind of debt, big or small, is hard to handle when money is too tight. Living a life that is dependent on borrowed money puts you at a higher chance of spending more than what you earn.

4. I regret not building up an emergency fund.

Building up an emergency fund is a common piece of advice. The sad thing about this is that too many people don’t have it. And when the unexpected situation arrives, they resort to emptying their savings, cashing out their retirement funds,

Financial emergencies may come in different forms like medical expenses, home repairs, auto repairs ...the list goes on. Arm yourself by building up an emergency fund that will help you get through unexpected financial circumstances.

5. I regret not having financial goals.

Having only a rough idea of where your money went every month or every year just shows that your finance is poorly managed. And this could lead to a dreadful financial situation in the future.

Setting and planning on how to reach your financial goals is essential to building wealth and ultimately achieving financial security. The key to financial success is to stay focused on doing all the possible actions and strategies that will help you achieve your financial goals.

6. I regret not having any form of investment.

If you want to enjoy your retirement without worrying about how you will get through a day’s spending, then consider investing as soon as possible. Investing is one of the best ways of adding up cash to your retirement fund through dividends and/or interest.

Because government pensions and social security funds may not be as consistent and reliable, plan your retirement like this financial support will not exist in the future.

Consider medical expenses in your retirement plan. Most people expect that their expenses will go down when they retire.

But the truth is, more often than not, seniors spend more after retirement due to higher medical expenses (aside from the fact that costs are always going up). Getting a long-term healthcare plan is a simple solution to this problem. Your current choices and resolutions when it comes to spending money may stem from the best of the best intentions. However, without careful planning, you may find yourself trapped in a situation where there is nowhere else to go.

So as early as now, work your way through financial success and worry-free retirement by reading and learning personal saving tips and personal finance.

Retirement planning entails many important choices and decisions that you have to make. It may be overwhelming to consider everything that is pointed out above all at once, but it pays to take one step at a time.

Fitz Villafuerte is a registered financial planner of RFP Philippines. To learn more about personalfinancial planning, attend the 102nd RFP program this July 2023. To inquire, e-mail info@rfp.ph or text at 0917-6248110. The views of Mr. Villafuerte do not necessarily reflect those of the BusinessMirror

COA: Pag-IBIG Fund’s cash reserve pool ‘short’ of ₧26.86B for liability to members

THE Commission on Audit

(COA) said Pag-IBIG’s member savings reserve fund (MSRF) is insufficient to cover the P60.448 billion worth of accounts that have matured and are maturing as of end-December 2022.

In its annual audit report, COA noted that the Pag-IBIG’s MSRF at end-December 2022 stood at P49.406 billion, or P11.041 billion short of the estimated total amount of matured P1 and MP2 accounts during the reference period.

COA explained that the shortage became bigger because P15.821 billion of Pag-IBIG’s MSRF will not be “readily” converted into cash “within the next 12 months” since it was invested in bonds and other debt instruments.

The COA noted that the earliest maturity for the investment in bonds made by Pag-IBIG would be next year, while the latest would be in 2042.

This leaves Pag-IBIG with only P33.585 billion in “cash and investments readily convertible into cash” within this year, hence, leaving it with a cash shortage of P26.863 billion to cover its liabilities.

“The Member Savings Reserve Fund (MSRF) is short of P26.863 billion due to insufficient allocation of funds amounting to P11.042 billion and earmarking of investment in bonds measured at amortized cost amounting to P15.821 billion as MSRF, contrary to the objective of AMO No. 2015-005 of ensuring efficient liquidity management for benefit claims and return of members’ equity,” COA said in its annual audit report on Home Development Mutual Fund (HDMF) published on its website recently. “Thus, the return of all benefit claims and member’s equity is not secured if all members file their claims at the same time due to insufficiency of funds readily convertible into cash,” COA added. COA noted that HDMF’s Accounting Memorandum Order (AMO) 2015-005 outlined the governmentowned and controlled corporation’s asset liability management practices “to ensure proper matching of assets with maturing liabilities,” which led to the establishment of the MSRF.

Under HDMF’s AMO 2015-005, the MSRF shall be used “for benefit claims and return of member’s equity upon maturity.”

The COA cited provision of the same AMO, stipulating that the total MSRF amount shall be “sufficient to cover the matured claims as of the end of the preceding year, those maturing within the year, as well as the projected benefit claims for the year.”

The AMO outlined that the balance of the MSRF “shall not be less than the projected benefit claims and members’ savings maturities for the following month.”

The COA report showed P42.557 billion worth of AP Members PagIBIG 1 (P1) and P17.891 billion worth of Modified Pag-IBIG 2 (MP2) matured at the end of last year. pag-iBiG cites historical data IN its response to the COA audit findings, Pag-IBIG said, based on its monitoring, the MSRF’s total amount of P49.407 billion “exceeds the actual P1 and MP2 claims based on historical data.”

However, COA argued that basing the allocation for MSRF “on the actual claims in prior years” would “defeat the purpose” of AMO 2015-005.

“However, if HDMF based its allocation for MSRF on the actual claims in prior years, it would defeat the purpose of the AMO, requiring the MSRF to be sufficient to cover the matured claims as of the end of the preceding year, those claims maturing within the year, as well as the projected benefit claims for the year,” state auditors said.

“Thus, the return of all benefit claims and member’s equity is not secured if the members will file their claim at the same time due to the insufficient earmarking for the matured and maturing claims,” they added.

The COA recommended that the HDMF “review” its current business model “used to manage the investment in bonds earmarked as MSRF, to align with the objectives of AMO No. 2015-005—specifically, the proper matching of assets with maturing liabilities.”

Furthermore, it recommended that the HDMF allocate funds to the MSRF based on actual matured and maturing claims instead of basing it on historical data of claims processed in prior years.

The COA report showed that the HDMF management agreed to the two recommendations. The HDMF is an attached government-owned