10 Financial Myths and Misconceptions of OFWs

There has always been a trend among OFWs: a cycle that involves finances, but often, it doesn’t end well because it didn’t start well. Despite this fact, OFWs embark on journeys far from their homeland, seeking employment opportunities abroad with the aim of supporting their loved ones and securing their financial future.

However, amid the noble pursuit of improving the lives of their families, myths and misconceptions have often surrounded OFWs and their financial situations. Let us take a closer look at some of these myths with the hope of understanding and breaking the cycle of financial challenges that OFWs face throughout their journey.

money myths for ofws

Myth 1: OFWs Are Always Wealthy

Debunking the Misconception: It’s a common misconception that all Overseas Filipino Workers (OFWs) are inherently wealthy due to their overseas employment. However, this myth couldn’t be further from the truth. OFWs come from diverse backgrounds and experiences, and their financial situations vary significantly.

Insight into Reality: OFWs working in different countries often earn varying salaries based on factors such as their job roles, qualifications, and the cost of living in their host countries. While some may enjoy relatively higher incomes, many OFWs work hard to support their families and meet their basic needs.

Myth 2: Working Abroad Guarantees Financial Success

Setting the Record Straight: Another common myth is that working abroad guarantees financial success. In reality, while overseas employment can provide opportunities for higher earnings, it is not an automatic path to wealth.

Challenges Faced: OFWs often encounter challenges such as high living costs, currency fluctuations, and job instability. These challenges can impact their financial well-being and make it essential for them to budget and plan for their future.

Myth 3: Remittances Are Only for Luxury Spending

Addressing the Belief: Some people assume that money sent home by OFWs is primarily used for luxury spending. However, the truth is that remittances serve a broader purpose.

Reality of Remittances: OFWs send money home to support their families’ basic needs, including food, housing, education, and healthcare. These remittances play a crucial role in improving the quality of life for their loved ones.

Myth 4: OFWs Don’t Need to Save for Retirement

Debunking the Notion: There’s a misconception that OFWs have no need for retirement planning because of their overseas earnings. This is far from accurate.

Importance of Saving: Like anyone else, OFWs should prioritize saving and investing for their retirement years. Planning ahead ensures financial security in the long run, even after they return home.

Myth 5: Financial Literacy Isn’t Important for OFWs

Challenging the Belief: Some assume that OFWs don’t need to be financially literate because of their overseas employment. This couldn’t be further from the truth.

Role of Financial Education: Financial literacy is essential for OFWs to manage their earnings and remittances effectively. It empowers them to make informed financial decisions, save for the future, and protect themselves from financial pitfalls.

Myth 6: OFWs Have Stable Jobs and Income

Dispelling the Assumption: Many believe that OFW jobs are always stable and secure. However, the reality is quite different.

Job Market Volatility: OFWs often face job market volatility, and many work under contract-based arrangements, which can be uncertain. This makes financial planning and job security challenging aspects of their lives.

Myth 7: OFWs Don’t Pay Taxes

Clarifying Tax Obligations: There are misconceptions about tax obligations for OFWs. They have tax responsibilities, both in their host countries and in the Philippines, depending on their income and residency status.

Understanding the Reality: Understanding these tax responsibilities is crucial to avoid legal complications and ensure compliance with tax laws.

Myth 8: OFWs’ Families Are Financially Irresponsible

Tackling Stereotypes: Stereotypes about the spending habits of OFWs’ families need to be challenged. In truth, families back home often bear significant financial pressures and responsibilities.

Supporting Families: Many OFWs send money home to support their families’ basic needs, and their families often manage these funds responsibly, prioritizing essential expenses.

Myth 9: OFWs Have No Need for Financial Planning

Debunking the Idea: Some believe that OFWs can manage without financial planning, given their overseas earnings. However, financial planning remains essential for their long-term financial well-being.

Significance of Budgeting: Budgeting, saving, and investing are crucial for OFWs to secure their financial future, whether they plan to continue working abroad or return home eventually.

Myth 10: Money Sent Home Is Always Used Wisely

Discussing the Assumption: There’s an assumption that remittances sent home by OFWs are always used wisely and for their intended purpose.

Importance of Communication: Effective communication between OFWs and their families, along with financial education, can help ensure that remittances are used for essential needs and not mismanaged.

These insights dispel common myths and provide a more accurate understanding of the lives and challenges faced by Overseas Filipino Workers.

How OFWs can be Financially Literate in their Journey Abroad

Now that we’ve seen a glimpse of how many OFWs are financially, let us try to learn from these experiences and apply any (or all) of these important financial tips:

  1. Prioritize Financial Education: OFWs should invest time in learning about basic financial concepts before going abroad. This knowledge forms the foundation for making informed financial decisions.
  2. Build an Emergency Fund: Saving a portion of earnings for an emergency fund, equivalent to at least six months’ salary, provides a financial safety net in case of unexpected expenses or emergencies.
  3. Secure Comprehensive Insurance: Having insurance coverage for both themselves and their families back in the Philippines ensures financial security during unforeseen medical or financial crises.
  4. Budget Wisely: Creating a realistic budget that covers basic needs, remittances, savings, and investments is essential. Open communication with family members about financial expectations is crucial.
  5. Avoid Accumulating Debt: OFWs should be cautious about accumulating high-interest consumer debt and prioritize saving and investment over unnecessary expenses.
  6. Start Small with Investments: Investing doesn’t require large sums of money. OFWs can begin with small investments in options like stocks, mutual funds, or real estate and gradually increase their investments over time.
  7. Seek Professional Guidance: Consulting with financial advisors or experts can provide personalized guidance for making sound financial decisions, planning for retirement, and achieving long-term financial security.

By following these key principles, OFWs can enhance their financial literacy and take proactive steps to secure their financial well-being during their journey abroad.

Video: “At Home sa Abroad: OFWs’ Personal Finance 101 – A Conversation with Joanne DG Rico

In this insightful episode of “At Home sa Abroad: Stories of Overseas Filipinos,” Rappler multimedia reporter Michelle Abad engages in a candid conversation with Joanne DG Rico, an accomplished marketing chief based in Abu Dhabi. Joanne recently launched her book, “It’s Not What You Think: Cracking OFW Myths on Personal Finance,” and she shares valuable insights into the world of personal finance for Overseas Filipino Workers.

Frequently Asked Questions

1. What are some common financial myths about OFWs?

Common financial myths about OFWs include beliefs that all OFWs are wealthy, working abroad guarantees financial success, and that remittances are only for luxury spending, among others.

2. Why do these myths persist?

These myths persist due to a lack of understanding of the diverse financial situations and challenges that OFWs face. Stereotypes and generalizations often perpetuate these misconceptions.

3. How do these myths impact OFWs and their families?

These myths can create unrealistic expectations and put additional pressure on OFWs to meet perceived standards. They can also lead to misunderstandings within families and communities.

4. What is the importance of debunking these myths?

Debunking these myths is essential to provide a more accurate and compassionate understanding of OFWs’ financial realities. It can help in shaping policies and support systems that are more aligned with their needs.

5. Are all OFWs facing financial difficulties?

No, not all OFWs face financial difficulties. Their financial situations vary widely based on factors like their job, location, and personal circumstances. Some OFWs are financially comfortable, while others may struggle.

6. How can financial literacy help OFWs?

Financial literacy empowers OFWs to manage their earnings, make informed financial decisions, and plan for their future. It equips them with the skills to navigate financial challenges effectively.

7. What can individuals and organizations do to support OFWs in debunking these myths?

Individuals and organizations can provide financial education and awareness programs, share accurate information about OFWs’ experiences, and promote empathy and understanding in their communities.

8. What are some resources available to OFWs to improve their financial literacy and well-being?

OFWs can access financial literacy programs, workshops, and online resources provided by government agencies, non-governmental organizations, and financial institutions. They can also seek advice from financial professionals and mentors.


In the pursuit of a better life for their families, OFWs often find themselves caught in a financial cycle that doesn’t always end well. Despite the noble intentions behind working abroad, myths and misconceptions have clouded the financial journeys of many OFWs. It’s essential to debunk these myths and misconceptions to help OFWs break free from the cycle of financial challenges they encounter throughout their journeys.

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