mutual funds

We’re sharing here how much 100,000 pesos would earn if invested on 3 investment wheels because a reader has requested a comparison of earnings between investing in a Mutual Fund vs UITF and VUL using his 100,000.

Note that this is for comparison purpose only and it’s not a mean to know which is better between the 3 because each product has different investment substance, fund allocation, strategy and management let alone every investor has different status, risk appetite and money goal.

If you’re not yet familiar with UITF, Mutual Funds and VUL, you can get to know them better by going to this post we made: “UITF vs MF vs VUL.”

But if you’d rather go forward this topic, go on and continue reading…

100,000 Investment Earnings Comparison from Mutual Fund vs UITF vs VUL

We used one of the best, most reliable, most established, and most decent funds in this comparison. Also we used the riskiest type of funds because we’re aggressive but we’re always keeping it calm 🙂

For Mutual Fund we used Philequity Fund, for UITF we chose BDO Equity Fund and for VUL we used Sun Life Variable Life Insurance that is tied up with Equity Fund.

In this comparison, we used 100,000 pesos invested for 3 years, from January 18, 2012 to January 18, 2015 to be exact.

We have used the 3-year period because Equity Funds are suitable for this investment horizon.

Here are the yields we have gathered for each fund.

Again this is just a comparison and it won’t guarantee future results. Each investment has different fund allocation and composition. Each may outperform the other any day. The bottom line here is all of them will give us money in the end.

If that is your revenue investing 100,000, what more if you invested 1 million or more millions? The return is awesome! It’s always the more you invest, the more you will gain. Yes, that is also why the rich becomes richer. They don’t let their money sleep on savings and time-deposits. They invest them or they use them expanding new business.

There are important factors you have to consider before you decide which investment wheel you will use such as your risk appetite, your financial goal and your financial status.

What is risk appetite?

For the sake of newbies here, it is how you can take risks. Investments are very risky. You may not always gain, you may also lose some. To combat risks, you have to invest for long term and diversify your money.

What is financial goal?

Simply how much do you want to earn. Do you want to become multi-millionaire? Perhaps you want to retire early? Or perhaps you want to use your money to build business.

What is financial status?

It will be answered by the following: do you rely on just regular income from your job? How much is your current networth? If you’re not employed right now, can your cash sustain your needs?

If you’re into investments now, it’s always best to diversify your money to different wheels. Make sure you don’t invest everything on one fund alone or on one account. Also make sure, it’s your 20% or 30% money and make sure you have many income generating assets that can shower you abundance in life.

What are these income generating assets I always mention? They are jobs, business and passive income. I will talk about more of them soon. Subscribe here so you won’t miss a new post. It’s free!

“It’s always better to invest some of your money than not to invest at all.”

Time to learn about VUL Insurance vs Mutual Fund vs UITF Investment. Many readers were asking about VUL so I’ve made this page to share about the main concepts of these investments. Which is better among the three? What is the best investment? Which will give you more money?

I have talked about mutual fund vs UITF before and that page contains the complete differences of the two including their advantages and disadvantages. To compliment that page, I have summed up the pros and cons, advantages and disadvantages of VUL, MF and UITF as well so you can decide better which investment you would choose or prioritize if you want them all.

Similarities of VUL Insurance, UITF and Mutual Fund

In a nutshell, all of them are investment wheels and they are pooled funds meaning you can earn or lose money depending on the performance of the fund and the market.

Knowing VUL insurance vs mutual fund vs UITF will help you learn more about managing your money and earning some profit from it. In my experience, I got UITF first then I opened a mutual fund. Eventually, I got VUL from Sun Life. You can check out the reasons in this post: 5 Reasons Why I Got Sun Life VUL Insurance

Differences between VUL Insurance, Mutual Fund, and UITF

As to what they are:

UITF – a.k.a. Unit Investment Trust Fund. The investor participates in a Trust Fund and he or she can earn or lose money according to the fund’s performance.

Mutual Fund – the investor becomes a shareholder of the mutual fund company thus he or she could also have a voting power in the corporation. The investor can earn or lose money according to the fund’s performance.

VUL – stands for Variable Universal Life insurance. VUL is both an investment and an insurance. The investor is insured therefore his beneficiaries will get money when he died.

As to Regulating Authority:

UITF – regulated by the BSP (Bangko Sentral ng Pilipinas)

Mutual Fund – regulated by SEC (Securities and Exchange Commission)

VUL – regulated by the Insurance Commission

Where to open an account?

UITF – you can open an account to majority of leading banks like BDO, Metrobank, BPI, PNB, Landbank, UnionBank, and the like.

Mutual Fund – they are offered by MF companies like Sun Life Financial, Philam Asset Management, Inc. and also banks like BPI. Some stock brokers also offer mutual fund products like that of COL Financial and First Metro Sec.

VUL – some companies like Pru Life UK, Sunlife Financial and AXA. VUL products are also offered in some banks. I saw Pru Life UK agents in BDO recently and AXA agents in Metrobank.

Who should you talk to when you open an account?

UITF – talk to a trust representative or simply ask the bank manager.

Mutual Fund – talk to a licensed mutual fund advisor or fund manager.

VUL – talk to an insurance agent

How much money do you need to open an investment?

UITF – it depends upon the type of fund. There is minimum amount required to Money Market, Bond Funds, Equity Fund, Balanced Fund etc. Minimum is usually P10,000, others are P50,000 and P100,000.

Mutual Fund – like UITF, there is a minimum investment to start a fund depending on the investment product like UITF. You can start if you have P10,000 too.

VUL – because it is also an insurance, you need to pay premiums and this type of investment is usually expensive but worth it.

As to mode of funding:

All these investments offer single-pay and regular-pay investments. I recommend you study and contemplate about your investment goal, status, needs, and capacity to invest.

As to taxes:

UITF – earnings are already Net Asset Value per Unit (NAVPU)

Mutual Fund – your earnings are already net of tax too (NAVPS)

VUL – you may not need to pay taxes because the insurance company is doing this part

As to fees:

UITF – no entry fees or upfront fees but there are management fees and redemption fees

Mutual Fund – there can be upfront fees, management fees and redemption fees depending on the type of MF

VUL – there can be upfront fees, management fees and insurance fees depending on the VUL product

Tips in Investing VUL Insurance, Mutual Fund and UITF

Deciding which investment to choose still lies on the investor’s financial status, investment goal and objectives. It is also important that the investor knows about mutual funds, stocks, UITF and related financial instruments. VUL insurance vs mutual fund vs UITF is not hard to understand.

Don’t be hypnotized by insurance agents and tempting investment offers of some companies especially the ones you never heard before. Study and learn first about the fund’s performance of any investment fund you are interested with. You can do this by looking at Bloomberg or simply go to the company’s website or see our latest lists:

• Best Mutual Funds Companies in the Philippines 2019

In my opinion, if you already have SSS or GSIS, you can just add more investments by having either mutual funds or UITF. As an employee or a business entrepreneur in the Philippines, assuming you have Pagibig too, you already have Mutual Fund because it’s HDMF. If you have SSS, you already have insurance. If you are a government employee, you already have GSIS and insurance policies. Therefore, you and your beneficiaries already have protections. VUL’s main purpose is wealth building plus protection (insurance). If you know where you’re standing, then you know how and what to invest. That is just my opinion.

Now that you learned about VUL insurance vs mutual fund vs UITF, you can learn deeper by getting to know about stocks and investing in the stock market

Share your comments and views about investing and wealth building. Because when you share, you’ll get blessed. 🙂

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