If you are an employee, Try investing in Bonds

 

If you are an employee, try investing in bonds if you are not a risk-taker.  Because like most friends I know think of stocks when they hear the word "investment".  Try bonds.  Bonds might be a great choice if you think equities are too risky or just want something more dependable. 

Bonds are great for cautious investors who desire a return that is more stable and predictable. We'll explain what bonds are, how they function, and why they can be the best way for you to save money in this post.  Whether you are an employee or a businessman, you will get something from here. 

What Are Bonds, Anyway?

A bond is like a "IOU"(its like I owe you) represents the fundamental nature of bonds.  When you buy a bond, you're giving money to an entity, such a firm, the Philippine government, or a local government unit. When the bond matures, they pledge to pay you interest (called the coupon) on a regular basis and give you back your original investment (called the principal amount).

So instead of owning something like stocks, you're lending it. And lenders always get paid first, even when things are tight.  Just like the MP2 from Pagibig where the government invests your money.  That is if you trust our government. hahaha!

What's the real difference between stocks and bonds?

The largest difference? Risk and ownership.

When you buy stocks, you own a share of a corporation.  You get a cut of the earnings, but you also lose money. When you buy bonds, you become a creditor. You don't own the business, but they have to pay you interest and give you back your money.  If you want to learn about where I do stock investment, please click here. 

But, if you want to be safe and stable, bonds are frequently the better choice.

Before you get started, here are some important bond terms you should know:

Face Value or Par Value: The amount you will get back when the bond matures. Most bonds are sold in amounts of ₱1,000.

Price: Bonds are purchased and sold for a proportion of their face value. For instance, if you see 112, that signifies you're buying the bond for 112% of its face value.

This is your interest rate. You get ₱50 in interest every year on a bond with a 5% coupon and a face value of ₱1,000.

Maturity day: The day when the issuer gives you back your whole investment.

Yield: This is the amount of money you really make, and it might change based on the bond's price and coupon rate.

How Safe is Your Investment? Understanding Bond Ratings

There are differences between bonds. That's why S&P, Moody's, and Fitch award bonds a score. These ratings inform you how probable it is that the issuer will pay you back.

Investment-Grade Bonds (AAA to BBB): Low risk and steady returns. Perfect for those who are careful.

High-Yield or "Junk" Bonds (BB to D): More risk, but greater possible rewards.

The general norm is to follow? The more danger there is, the more gain there is, but also the more likely it is that someone will not pay back their loan.

How to Pick the Right Bond for You: Ask yourself:

Do I want a steady income with little risk? Choose bonds that are good for investing.

Am I ready to take on greater risk in order to make more money?

Yes Look into high-yield bonds.

No matter what you choose, bonds may be an important element of a well-rounded portfolio. They help you stay stable amid market swings and give you a constant source of income, which is very helpful for planning for retirement or getting your finances in order.

Why Filipinos Should Really Think About Bonds

When it comes to money, we typically think too much about "quick wins." But making sensible, consistent choices is what leads to financial independence. Bonds may not be as exciting as stocks or bitcoin, but they may provide you peace of mind, which is often worth more than money.

You will be better able to make smart investing decisions that fit your beliefs and way of life if you learn how bonds function. Bonds can help you get there securely, whether you're saving for your child's school, creating an emergency fund, or getting ready for retirement.

Make sure your future, One Bond at a Time

Don't wait for a market crisis or an emergency to think about how to protect your money. Today is a good day to start looking at bonds. Get in touch with a professional financial advisor who can help you choose the best bonds for your goals and level of risk.

If you need more information related to other bonds products please send me a message. I'll be happy to assist you.

📩 Want to learn more or get tailored help? You may reach me at papajackph@gmail.com or on social media. I'd be pleased to explain it to you without using any jargon.

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About the Author

Jack Marbida is a financial advisor, speaker, and writer devoted to helping Filipino families become financially free and emotionally grounded. He is a proud husband to Wene and father to two energetic boys, Isaac and Israel.

As the founder of Online Advisors Financial Education, Jack creates free, practical content about investing, insurance, and family finances. He has spoken at various conferences nationwide and has been featured by Sun Life Financial and other organizations for his advocacy in financial literacy.

Let me help you grow not just your money—but also your purpose and peace of mind.