The implementation of financial literacy programs would help overseas Filipino workers (OFWs) maintain their financial resources over the long term, particularly as many of them are aiming to retire early, a study by the Philippine Institute of Development Studies (PIDS) revealed.

In a study titled “Long-Term Effects of Labor Migration in the Philippines: “Napakasakit, Kuya Eddie!” led by PIDS Senior Research Fellow Jose Ramon G. Albert, researchers said that OFWs who do not have stable jobs often find themselves seeking support to manage their finances.

“They are eager to learn how to wisely invest their hard-earned savings, ensuring that their financial resources not only sustain them in the short term but also contribute to their long-term well-being,” the researchers said.

“Equipping OFWs with the skills and knowledge to navigate the complexities of financial management and investment is crucial for securing their financial future and enabling them to transition smoothly into their post-overseas work life,” they added.

According to them, financial literacy programs for OFWs are not just an investment for their well-being but also a part of the country’s “paying back to these modern heroes for their contributions to the Philippines' continued economic growth and prosperity.”

Data from the Bangko Sentral ng Pilipinas (BSP) showed that in 2019, OFWs sent home $30.1 billion, which was equivalent to eight percent of the country’s gross domestic product (GDP).

Even during the peak of the pandemic in 2020, remittances remained resilient at $29.9 billion, further preventing the economy from declining.

However, most of these remittances mainly go to consumption at 47.4 percent followed by savings at 24.8 percent, the researchers said, citing the Survey on Overseas Filipinos.

Investments in properties, business ventures, and financial instruments were pursued by OFWs at only 12.6 percent.

“Financial literacy programs can educate OFWs on managing their earnings, savings, and investments, encouraging them to invest in sustainable projects that contribute to the economic development of the Philippines,” they said.

Currently, the government has been providing financial literacy programs and financial instruments for OFWs through the OFW Bank.

The BSP’s PiTaKa or “Pinansyal na Talino at Kaalaman” program aims to provide knowledge among OFWs in securing financial resources. It includes sessions on setting up a Personal Equity Retirement Account (PERA), and the proposed relaunch of the OF portal on the BSP website.

The central bank also advocates for financial inclusion through access to transaction accounts, such as Basic Deposit Accounts and e-money wallets, to encourage account-based remittance transfers.

However, the researchers still think that there is still room for improvement in the government’s programs on financial literacy among OFWs.

“The communication of government initiatives to improve the financial literacy and stability of OFWs has, however, not been systematic enough to make a solid impact,” they said.