5 Reasons You Can Be Rich, Wealthy and Financially Independent

 By:  Gilbert M. Forbes
DepEd Quezon

All working folks, either salaried workers, professionals or those from the informal economy like all types of vendors, drivers, free lancers, etc.

Are you dreaming of a life of abundance where helping others and giving to charity is no longer a problem?  You are not worried about any unexpected or emergency expenses such as those related to health because there is a fund for it.

You can still continue to work if it is your passion without any financial stress.  We’ll, life of financial stability, abundance or wealth is actually realizable if we know how.

1. Understanding how money works
Money is not actually the root of all evils.  It is the LOVE OF MONEY that is.  Actually, we are equally vulnerable to the devil when we don’t have enough money because we may end up doing bad and evil things like gambling, falling into the trap of debt and corruption.

Money is not a complicated topic, at least, now a-days, because of the ability of self-help books and lots of articles on-line. One needs to browse and study one of these books.

There are books written by successful Filipino Entrepreneurs and financial wellness and spiritual coaches like Francisco Colayco, Bo Sanhez and Chinky Tan.

This blog also offers quite a handful of financial literacy articles that could somehow be of help.  The only key is the interest to learn, internalize, reflect and apply it.

2. Life-long Learning
Never stop learning for the real wealthy people never stop.  Learn from experiences and mistakes so that it will no longer be repeated.  Don’t just go along the tide of a complicated and materialistic lifestyle which only makes our lives difficult.

Distance yourselves from influences which are not in line with your new chosen lifestyle.  Let your immediate circles understand your decision, if not, let the time do it.  Once they saw the result of your decision in the years ahead, they will surely realize your point.  

3. Live below your means
Live at least 10- 20% below your means and save the rest.  You have done it already while you were studying, much, when you were still looking for a job, why not this time?

Involve the family in your decision by explaining them and by educating them too.  Let them have a prospect of the future too. 

Most of the financially stable right now have made a conscious decision to live on less than they make 20 years ago.

They saved a lot until they were able to capitalize on things that will generate more additional or passive income like transport business, hardware, grocery store, agricultural farms like fish pen, rice and corn farm, etc., while others in high yielding time deposits, additional retirement funds, real state, educational and health fund, etc.

Budget and stick to it.  Never mind what the close-minded people will tell or label you.

4. Avoiding bad debt as a deadly virus
Open an irregular and emergency account so that you will not get into the trap of debt in times of seasonal and emergency needs.  Once, you become the bread winner of the family, be fully aware that you will gonna pay tuition and school fees, and most of all pay for hospital or medical needs in times of sudden sickness.

If you have an irregular expense account, then you will no longer be worried about tuition and sudden sickness requiring hospitalization. 

5.  Building assets that earn
Your house, your car, even your jewelries couldn’t be regarded an asset if it don’t give any financial benefit.   These could be liabilities that are reducing your earning potentials towards financial independence and wealth.

A house for instance could be regarded as an asset if your monthly amortization and travel expense is less than or equal to your monthly expected rental and travel expenses to work.

Young professionals and income earners out there particularly the young ones.  Becoming financially independent, wealthy, a millionaire or whatever you want to call it is not impossible. Since you still have all the time and a lot of prospects plus the knowledge to do so, it’s easy. 

Those in the early 30’s, there's still a lot of time to catch up while those in their 40’s, double time.  Those in their 50’s or retiring ones, all you can do now is fix your finances and free yourselves from debt as fast as you can before your retirement.

You may also like reading Save and Be Debt Free!

Stewardship and Financial Wellness

(Mr. Gilbert M. Forbes is an educator who was also a victim of financial ignorance.  Upon stumbling on a financial literacy book a decade ago, financial literacy or wellness has become a part of his personal advocacy aside from politics, good governance, education and environment.  He holds baccalaureate and post-graduate studies from the Philippine Normal University and have been a school head for more than ten years now.)

Financial Ignorance Is Expensive

By:  Bo Sanchez
Philippines renowned best selling author, lay minister and entrep

(Excerpts or one of the articles from the book 8 Secrets of the Truly Rich)

"The number one problem in today’s generation and 

economy is the lack of financial literacy."

 — Alan Greenspan

Some people think buying a book like the 8 Secrets of the Truly Rich is expensive.  I also give financial seminars and people think the price we charge is too high.  If you think financial wisdom is expensive, then try ignorance. You’ll realize it’s a million times more expensive.

FACT: We could all be educated but financially ignorant.

For example, in the past 10 years, I’ve lost a lot of money. Simply because I was stupid about money.  After getting married, I was able to scrape a decent amount of savings into our bank account every month. And with some very generous gifts from our ninangs.

During our wedding, after a few years, my savings reached P200,000 plus. (Sssshh. Don’t laugh too hard.)  That was when a friend asked me if I would like to put my money in the investment company she was working for. “You’ll earn two percent a month,” she said, “and you’ll help me earn a commission from your investment!”

And instantly, I invested our P200,000. After all, two percent a month came down to 24 percent a year—so much higher than the banks’ interest. That was also the time when my wife finally got pregnant.  The thought of becoming a father was an incredible feeling.  But together with my excitement was the stark realization that the baby would now be totally dependent on my finances for the next 20 years of his life.

That thought sent chills down my spine.  We borrowed a wooden crib from a cousin and prepared P20,000 for the birth of our baby. We were ready, or so I thought.  During the delivery, my wife suffered heart palpitations reaching 200 beats per minute and the doctor ordered an emergency Caesarian operation.  Yes, I almost lost my wife and baby. That emergency operation saved their lives.  After three days of confinement, I received the bill from the hospital:  P56,000.

Gulp.  Have you ever received a solid punch straight to your solar plexus?  That was how I felt at that moment. So I called my friend and asked if I could get my investment back. Perhaps just P40,000 of my P200,000 to pay the hospital bill.  She said, “I’ll try...”  “Try? Why try? Isn’t that my money?” I asked, “I need to pay the hospital.”  “It isn’t that simple,” she explained. “Your money is being used.” “What do they use it for? Who owns this company anyway? How long have they been in business?” (Do you see how wise I was? I was asking these questions after I invested my money.)

“We’re a small firm that lends money to tricycle drivers.” “What...” Have you ever seen a cat staring at the headlights of an oncoming truck? That’s how I looked. “And collection hasn’t been very good,” my friend’s mutter was barely audible. “So that means...”  “uh, that means we’ll have to wait for new investors to come in before we can return a part of your money.”  In other words, I waited for three years for nothing. After that the company closed, folded up, crashed, disintegrated, imploded, sunk to

the depths of the earth, vanished into thin air.  With my P200,000 with them.

Don’t you see?  I was financially dumb.  Let me give you my credentials: My I.Q. is 132, I have above-average  social skills, I finished Philosophy in college, I took post-graduate courses in Theology, I founded four organizations, and I’m a more-or-less over-all wholesome guy... But all these don’t take away the fact that I was a financial nincompoop.  I was 100 percent financially illiterate!

Here’s what I found out...

You could be a doctor with three PhDs behind your name.

You could be an engineer building huge bridges in your spare time.

You could be a very holy person, praying three hours a day.

You could be a scientist inventing the first car that runs on spit.

You could be 97 years old.

You could be an extremely loving saint.

You could be a diva with the voice of Celine Dion.

But you could also be financially illiterate.

A world-renowned surgeon doesn’t open up a busted TV set and say, “I operate on people, I guess operating on machines would be a breeze.” No, it won’t be. It’s a totally different world.  So it is with money.  Knowing how money works is a totally different field of expertise. Financial ignorance is expensive.

You may also like reading the complete book in this link in PDF Format:  8 Secrets of the Truly Reach
7 Tested Ways to Consider When Buying a House and Lot You Want to Call Your Home  
7 Key Financial Advise to All Young Professionals and Wokers Who Are Starting to Earn a Living  
Things the Rich Do Every Day that the Poor Don’t  
 

Things the Rich Do Every Day that the Poor Don’t

(Based on Tom Corley’s 20 Things the Rich Do Every Day, on his website RichHabitsInstitute.com and Bo Sanchez Don’t Try to Appear Wealthy.)  

Wondering why the rich get richer and the poor poorer.  Aside from gigantic resources, what do the rich do every day that the poor don’t do?  What are possibly their values and attitudes? 

1.      86% of wealthy love to read vs. 26% of poor.

Instead of more hardwork, the poor gambles. 
 (google search photo)

2.      88% of wealthy read 30 minutes or more each day for education or career reasons vs. 2% of poor.

3.      63% of wealthy parents make their children read two or more non-fiction books a month vs. 3% of  poor. 

4.      86% of wealthy believe in lifelong educational self-improvement vs. 5% of poor.

5.      81% of wealthy maintain a to-do list vs. 19% of poor.

6.      67% of wealthy write down their goals vs. 17% of poor.

7.      80% of wealthy are focused on accomplishing some single goal. Only 12% of the poor do this.

8.      6% of wealthy watch reality TV vs. 78% of poor. 

9.      44% of wealthy wake up three hours before work starts vs. 3% of poor. 

10.  74% of wealthy teach good daily success habits to their children vs. 1% of poor.

11.  84% of wealthy believe good habits create opportunity luck vs. 4% of poor.

12.  76% of wealthy believe bad habits create detrimental luck vs. 9% of poor.

13.  23% of wealthy gamble. 52% of poor people gamble.

14.  70% of wealthy parents make their children volunteer 10 hours or more a month vs. 3% of poor.

15.  36% of wealthy bought only second hand cars and most kept their ordinary cars for years versus the 66% of the not so wealthy who bought luxury cars.

16.  100% of wealthy saves 20% or more vs. 2% of poor.

In addition to these lists, most of the really wealthy rarely wore designer clothes, rarely lives in expensive homes, rarely have expensive vacations, rarely bought luxury cars.  They lived way below their earning capacity, so that they could save more and multiply their money through investments and business.  Most of the really wealthy didn’t reside in upscale villages because it would only pressure them to mantain an upscale lifestyle—something they didn’t want to do.  And most didn’t change homes for 30 years or more!  They trained their kids in the values of simplicity, frugality and hard work.

Now, what about us, the middle class and the ‘masses’ or the common people?

7 Key Financial Advise to All Young Professionals and Workers Who Are Starting to Earn a Living

By:  Gilbert M. Forbes
DepEd Quezon, CALABARZON

Do you still remember when you were still studying until the time when you were already looking for a job?  You were able to survive and live within your means given the meager allowance from your parents, siblings or benefactors.  In fact, there are lots of time that you were still able to save from these highly budgeted and exact allowance given to you.

Compare it to your current financial status now that you are already earning for a living as a newly employed worker or young professional.  Are you still able to save?  Is money still a big problem?  Does it still play a big picture in your life? If the answer to all these questions is a resounding yes, then, you could have been going straight to the trap of financial difficulties in unimaginable magnitude as compared before when you were still studying.  You need a total life style check.

(moneytools.org photo)  They should manage money wisely.

First Key.  Reflect and analyze.  What went wrong?  Is your spending habit the same as before or it skyrocketed after finding a regular job. Commonly, once we reached a new level in our lives such as having a regular source of income comes an upsurge in our spending habits.  We begin to need things we don't need before.  These are wants which are not necessary and thus could be set aside like weekly or even monthly dine out with the family to a popular food chain, branded clothing, high-end cellphones, computers even un-planned house repair or renovation and expensive education of siblings.  The right thing to do as advised by various financial coaches is that, an increase or an additional income for the family should not mean an increase in their spending habits.  They advised that, if we are still living with our families, only our share for the food expense and groceries should be added to our regular expenses.  Meaning, if we are spending four thousand a month when we were still in college until the time we graduate and start looking for work, only the share for food, groceries and lets say utility payments should be added and the rest should go directly as savings.

Second Key.  Revisit your goal and life's dream.  Everybody's goal is to achieve certain level of financial security.  Others call it, an improvement in ones living condition.  But given the scenario above, without considering financial coaches advise, it is unlikely that things will get better.  Consider this.  What if there is sudden emergency such as sickness that requires hospitalization among one of the members of the family?  What about when you opt to decide to settle down and start a family of your own?  How will your financial status go along?  Imagine the quality of your life ten to fourty years from now.

Third Key.  Live on less and simplify.  G.K. Chesterton once said that there are two ways to get enough:  One is to continue to accumulate more and more. The other is to desire less.  Bo Sanchez in his bestselling book Simplify and Live the Good Life explains that we should focus on what we have not on what we don't.  It's because, satisfaction doesn't come from getting what we want but from wanting what we already have. "Some take their pleasure from dining in classy restaurants, going on trips . . . and owning the latest home theater equipment.  I've chosen the simpler path: If i can simply be with my wife, or take a quiet stroll under a canopy of stars, or play with a child, or read a good book in my home, or laugh with friends over an instant pancit canton, I consider myself richly blessed," said Bo Sanchez in his book.  Certainly, we could have a lot at the comfort of our homes with our family, friends and the community.  All these for free!

Fourth Key.  Budget and start savings at once.  Start budgeting and along this start also writing down your daily expenses.  Analyze it after a month to know the pattern of your spending and you will be surprised by the result.  You will know that you are spending quite a portion of your monthly pay on things you don't really need or you could be over spending on some that you could cut back later let say cellphone load, bottled water or even softdrinks.  Continue budgeting and listing your daily expenses until it becomes a habit so that it would be easy to track and monitor your expenses.  Once you made it a habit, start saving as much as you can.  Take note, savings is an expense for the future, so a decided or target portion of your income should automatically be deducted to your monthly pay then budget what has been left.  Start saving for the following:

• buffer fund.  Set aside money until you are able to save at least 5-months of your gross salary.  This will give you and your family a fall back in case you got laid off from your work.  You will have enough money that can supply your needs while you are looking for a new job.  If you want six months or a year equivalent of your gross salary, much better.
• irregular expense account.  this is a savings account intended for seasonal expenses such as tuition fees, family celebrations such as birth days, wedding anniversary, Christmas, new year etc.
• protection fund.  if your the sole bread winner, you need to be protected in a form of life or the new one, a variable insurance so that whatever happens to you, your family will be in good hands for a certain period of time.  You may have personal with regards to this matter.
• marrying or settling fund.  For those who are actually of marrying types or whose ultimate aim is creating a family of their own, there is certainly no time and money to waist.  One need to have a longer foresight of the future otherwise, life will be more difficult in the future.  Since, as singles, most are still living with the parents. save as much as you can.  The bigger chunk of your income, let say 50% or even more of it, the better.
• retirement fund.  aside from SSS or GSIS, financial coaches and analyst highly recommend to have an additional retirement fund because your retirement and pension will probably be not enough to live decently . As we age, we would need medications. Right now, there are 3-in-1 retirement fund (health care, life insurance and investment in one) like Kaiser which is a long term plan which covers beyond 60yrs old & above based on the health funds accumulated. Get a quote here https://402183ph.imgcorp.com/quote/kaiser or m.me/financialwellnessclubph
• health care card.  If you are still young, you could also consider getting a health care cards in addition to your Phil Health. If you are the bread winner, you may get one for your dependents too.  It will help and save you from financial problems in the future as such, unwanted or unplanned debt which is a common occurrence. The downside however of healh care card is that there is no investment return like the one mentioned above.  Its up for you to decide however.

 Save, save, and save to earn interest from it instead of the creditor earning so much interest from you through loans.

Fifth Key.  Avoid going with the tide.  Don't let things such as the clothing you wear, jewelries, cellphones you use define yourself.  Aware and financially educated people don't use material possessions as barometer of wealth or financial stability but on your networth instead.  Get along with people who have embraced simple lifestyle and have clear financial goals for their future.

Sixth Key.  Create your financial plan based on your life dreams.  Bo Sanchez explains that writing down a financial goal is an exercise in faith and an exercise in personal commitment.  He said that it helps our mind to open up and think of ways how those goals would be met.  As such, it would led us going back to our divine appointed mission in life- because that was how God was going to provide for our needs and desires.

Seventh Key.  Purify your thinking and motives about money. Money isn't evil.  the LOVE of money is.  Money is something that can be used to love or hate, to build or destroy, depending on how you use it.  In other words, it can make you holy or it can make you evil- much like anything else in life.  Purify your thinking towards money by embracing the truth that God wants you to have some material things to live a human life, enough for your needs and more than what you need, so that you can be generous.  Money should come from our highest values.  Money should be taken as an instrument to do more good.  That is to provide for the basic needs of our families.  To be more generous to those in need.  To support and help our churches and the ministry of your choice.

We should not forget that we could not simply give what we do not have.  But in all of these, put God first!

Reference:  Sanchez, Eugenio R., Jr., Simplify and Live the Good Life, Shepherd's Voice Publication 2008

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An Example of Financial Ignorance

14 Million Pesos is a already a very big big amount of money that one can receive now a days.  Even a retiring level two management employee in government could hardly receive three million at present.

But it is just very sad that it is gone in only three months.  Should he put it in business, even it didn't succeed, at least, he has helped employed some.

It only shows how important is the knowledge of how money works and should work not only among the rich but most importantly to the common people.  Here is the complete article from the Manila Bulletin as appeared on Tuesday, March 13, 2012.

 Lotto Winner Spends P14M In Just 3 Months

MANILA, Philippines - For three months, Dionie Reyes (DR) - winner of P14,125,032 in the Lotto 6/42 draw on April 22, 2008 - lived the life of a millionaire, something he had been longing to experience.

He lived in a P4-million house in a posh subdivision, drove around in a sports utility vehicle (SUV), and gave goodwill money, ranging P1,000 to P 850,000, to relatives and friends. He also gambled daily, womanized, and went on regular drinking sprees.

In an exclusive interview, DR told the Manila Bulletin that he did not regret throwing all the money away, because it was his, he enjoyed it to the hilt, and he did not take it from anybody else.

"I won it from a lotto game of PCSO (Philippine Charity Sweepstakes Office)," DR said. "It was my money. I spent my P14 million in three months," he admits.  But in the end, he felt sorry for his unbridled spending spree.

From being an instant millionaire, DR now owes some people about P500,000.

And to underscore his current state of living, DR underwent a heart surgery at the Philippine Heart Center (PHC) last September without any cash on hand. And he had to thank the PCSO management for helping him pay for the cost of operation of about P500,000, more or less.

Nearly four years after his lucky streak, the married native of Las Piñas, now 47, with an 11-years-old adopted son, said he wants to tell his story so others who may strike gold, or already did, with the lotto games may learn a lesson or two from his experience.

When this pen pusher, rather Blackberry user, told him his name will not be mentioned to shield him from any uninvited or unintended consequences of his coming out in public, he won't have it that way.

"If you are not going to mention my name, then there is no use telling my story. Readers may not believe your article. You may even use my photograph," he insists.

"After all, I have nothing to fear. That was about four years ago already. I had spent all my winnings. Nothing is left, except my house and the things I gave my relatives, office mates, friends, and acquaintances," he says.

DR recalled that before his mother Paz died at 71 in 2004, she used to tell him that she had been praying for him to win in the lotto play.

"Anak, ipinagdarasal ko na manalo ka na ng lotto para makatikim naman tayo ng ginhawa (Son, I have been praying that you win in the lotto so we can have a better life)," DR recalls his mother telling him.

DR proudly said that being the youngest of his six siblings made him the favorite of his mother. He has five sisters and a brother.

About four years after his mother's demise, DR finally hit the jackpot, using a Lucky Pick, System 7 bet worth P70. A System 7 bet has seven combinations.

"It was a Tuesday when I hit the jackpot. My boss announced that a lotto machine gave out the winning numbers for 6/42, Lucky Pick, and System 7," relates DR.

"I had all the three categories. So, I silently hoped that I am the winner," says DR. He did not check his ticket yet.
Wednesday evening, after work, like in many other days before, DR went on another drinking session.

He still did not check his lotto ticket in his wallet, which by then was already drenched with his own urine because of too much drinking.

Friday, at lunch time, while eating with an office mate, DR took out his smelly wallet and got the 6/42 ticket. He had memorized the winning combination, 09-15-18-23-28-40, which had at stake P14,125,032.

"Uy, I got three... four... five numbers," DR exclaims, as excitement overwhelmed him. He said he no longer mentioned he got all the six drawn numbers. He just nudged his officemate, who got the message.

"At 1 p.m., accompanied by my boss, I had my winning ticket validated at the PCSO's Internal Audit Department. The lotto machine did not accept it at first because of urine smudge. So, the validation was done manually, entering into the lotto machine the security numbers in the ticket," recounts DR.

The PCSO validation machine confirmed DR won the more than P14-million jackpot.

"After about an hour, I got the check and I went to the bank, still with my boss," he said.
"Lahat tayo may pangarap. Gusto ko talaga magkaroon ng kotse, magandang bahay, at makahawak ng malaking pera. Kaya sinabi ko sa bangko bigyan ako ng isang milyon na cash at tulungan ako makabili ng Toyota Fortuner na usong-uson noon," he recalls with fondness.

He said he was adamant he wanted to go home driving his new car, and a million-peso cash with him. The bank made sure he got them. It was already evening when he got his shiny Sports Utility Vehicle (SUV).

Later, DR also bought a P4-million house and lot at BF Homes in Las Piñas.

Out of his winnings, he gave his six siblings P50,000 each; another P500,000 to one of his nephews for a three-door apartment he wanted to build; and from R1,000 to R30,000 to some of his office mates; and R100,000 to his boss.

He gifted a nephew of his wife with a car worth P850,000, a Mitsubishi Fuzion. DR now hitches a ride with him every time he goes to work.

For a month, he did not go home to Cavite where he lived at the time he won. He stayed with a sister-in-law in Parañaque City.

When he finally showed up in Cavite, he gave away from P5,000 to P50,000 to some friends and neighbors.

DR estimated he gave away about P2 million or more for "balato" to relatives, friends, neighbors, and office mates, not counting people he did not know who came to him to borrow money.

"I just gave them and told them not to pay me back," he says.

Just over a year later, he sold his car and then his house at BF Homes. He bought another house also in Las Piñas worth P1.7 million. He now wants to sell the house to pay off debts.

DR narrated that the rest of his money, about P10 million, was gone in only three months.
"I spent all my money through daily gambling, especially cockfighting, drinking sprees nightly, and womanizing. Almost every day, I lost a minimum of P100,000 in cockfighting. It was very quick, I had an especial ATM (automated teller machine) card issued by my bank," DR says.

"Every time I came home, my wife just cried and cried. She asked me many times to stop. I did not listen. My siblings also asked me to change ways and have a new life," he recalls.
"I did not listen to any of them. It was my money, anyway. I won it fairly not at the expense of others," DR maintains.

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Value of Personal Finance as Advocates Promote Validated by Orman's Visit, A Wake Up Call to Skeptics

By:  Gilbert M. Forbes 
DepEd Quezon, CALABARZON

Photo from www. siliconangle.com

Personal awakening on the value of managing finances well came to time when I was almost broke seven years ago.  The toll of financial mismanagement is great because until now, instead of being on a savings stage and creating passive income, I am still struggling on getting out of debt the fast as I can.

Slow as it may, but we are doing well.  From having debt to seven major creditors, we are now trying our best to get out of the remaining three of which the house and lot where we reside is included.  From having a negative net worth, we are now experiencing a positive net worth for three years and it is continuously increasing. 
 
With the difficulties our family has to pass, since, experiencing for the first time having a positive net worth three years ago, I was inspired to include financial literacy in the work place as one of my personal advocacy.  It later included this medium.

However, fellow workers acceptance of the concept is still weak.  I could still remember one time that a fellow worker said in defense of her colleague that I should understand that we have different set of values when it comes to finance.  That we should just leave it that way.
 
The problem however, is due to being enslave to credit, as a result of complicated lifestyle their productivity in the work place have been affected tremendously.  Some have to do business in the work place even when it is greatly against the work place policy and ethical standards. Their lukewarm attitude towards the value of simple living and managing finances only proved them wrong upon the visit of Internationally Acclaimed Personal Finance Expert, Suze Orman who warned Pinoys of their spending habits which is patterned after the Americans.  
 
“ Filipino consumers should avoid going the way of the US, which had allowed its economy to grow on credit (card) and lending to people who could not afford homes and have been grappling with more people “on a highway to poverty.” “Build this country on cash (meaning save more and more) so that it could never collapse, then you can change your lives,” said Orman, who was raised in an unruly Chicago neighborhood and who used to wait on tables and sleep in her car before transcending poverty as a broker at American investment house Merrill Lynch.

The American personal finance guru spoke strongly against incurring debt to purchase non-essential things, noting she had watched her own country fall apart because of this.  She said consumers must distinguish between good and bad debt, good debt being amortizing to one day own a home.
I could say however is cautioned must be undertaken when applying for a house and lot.  Be sure that your budget and ability to pay is considered or else, home amortization would also led you into trouble.  Investing in real state is better if it will generate income enough to pay for itself or you are renting a home and the rent is more than enough for rent to own financing.  If not, its better to invest in agricultural lands which could be must cheaper particularly in rural areas.

Orman also advised OFW’s to consider whether sending money to adult brothers or relatives would only be encouraging dependence. “Is it possible that it’s hurting them rather than helping them?,” she said, adding that some people may not reach their potential or may not be driven into making contingency plans because they have remittances to fall back on.

But she stressed that for parents, it’s a whole different light, as she herself would want to take care of her mother. For young people, they should realize that their best commodity is time and that by starting to regularly save a portion of their earnings regularly, they will accumulate more wealth with the help of compounding, which means earnings from an initial investment are reinvested over and over, according to Orman.

With the help of compounding, she said a person who would set aside $100 (or Php100) a month starting the age of 20 would end up with $1 million (or Php1 million) upon reaching 60.  But if one waits until age 30 to start setting aside, the same person will end up with only $300,000 at age 60. This 10-year delay in starting an investment plan has thus cost the person $700,000, she noted.

“Every single person in this world has the ability to be more and have more and it’s the choices that we make about ourselves that become our net worth,” she concluded. I am just sad that I am already 20 years or more late because until now, I am still settling for the eradication of my debt.  I wish, I could have learned all of these when still new in the service and fresh from college and from the success of having between ends meet.

If it would have been, we are already millionaire and could have been helping more and the nation instead of being still in-debt.  Thanks to the strong will that God has provided us through the years.  His guidance and presence gave us enough wisdom to delay gratification though at times we still had some buying sprees.

Reference:  Dumlao Doris C., Philippines to shine in global community soon, says finance guru Suze Orman, Philippine Daily Inquirer, Feb. 28, 2012.

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Pagiging Mayamang Tunay (Being Truly Rich: A Series on Financial Literacy and Personal Finance in Filipino)

Being Truly Rich: Gaining Financial Freedom (Paglaya sa Kakapusan) Second Part in a Series  

Knowing How Financially Healthy or Un-healthy We Are (Being Truly Rich: Third Part in a Series)

Eight Steps to Get-out of Bankruptcy and Debt (Walong Paraan ng Paglaya sa Pagkakabaon sa Utang)  

Financial Education, A Must for Teachers   

An Spending Instance That Could Have Been Avoided

Gilbert M. Forbes

Spending is easy that in the end you will not notice that you have already ran  out of budget.  For quite a couple of days, I have already spent a portion of my disposable income, I considered it is as such because it is an extra income.  Hence, I already allotted all my bonus to pay for two of three of our astounding obligations.  That is for a basically financially literate and practicing personal finance person already. 

Photo from lammatlarge.wordpress.com

The truth is, I could have just set aside those things like for instance purchase of a hybrid AM-FM radio, a set of classical music CD's, 3g cell phone LCD repair, and some kitchen utensils.The fact is t was an spending instance that should have been avoided but it wasn't.  What more if I'm not practicing personal finance and that I am financially illiterate, I would have spent more for I am thinking of replacing my 10-ten year old CRT Likom PC monitor by an LCD, buy a new hard disk to replace my HDD which is already running out of space, a netbook or an android phone but I declined.

Still, I am actually defending myself saying that those purchases though few are necessary.  The hybrid radio is needed so that we will no longer depend on TV for news and talk shows saving us on electrical consumption. The classical music cd is for our toddler for his mind and our minds stimulation and the last because I just want it repaired.  The cell phone is still greatly functional and is for home use only.

This is the psychology of spending.  Our mind is quick to put rationality on our actions even if it tends to complicate things.

The quick reminder is, are we willing to live in a complicated atmosphere?  I’m not,  that's why I am taming myself.  My inspiration is simple.  Once I got out of my debt, I could start immediately on my journey towards financial freedom.  I just couldn't think of a life having no debt to think of.

This is not only for my future but also for all those who depend on me.  And most of all for my God for apart from Him, nothing would be possible.

For additional info and inspiration, also see Keeping Away With Spending Spree Every Christmas Season

Enlarging Territories by Thinking Big

From the original entitled How to Enlarge Your Territories by Bo Sanchez

A long time ago, I was taught that a person who thinks big has a big ego. And a person who thinks small is a holy person.

Especially in religious circles, big thinking is criticized and small thinking is praised. Because all desire for expansion is a sign of pride.

And when a person says, “I want to be promoted in my job,” or “I want to earn more,” or “I want to expand my business,” some religious people will tell you, “Be happy with where you are. Be content with what you have.”

But today, I’ve realized that small thinking may mean small love. Some people think small not because they’re content, but because they’re cowards.

As little children, we were told, “Don’t stand out. Don’t rock the boat. Don’t create waves. Don’t call attention to yourself.”

But now I tell you: Stand out. Rock the boat. Create waves. Be the best that you can be. Fulfill your destiny. Don’t put your light under a bowl, but put yourself on the lampstand. (Matthew 5:17)  And shine God’s light within you!

My main message? Think big, love big.

Think Big

Once upon a time, the Israelites were conquered by the Babylonians and Assyrians. They were captured, chained, and hauled off like animals to another country to become their slaves. 

One day, after many years in captivity, they returned to their land. But the Israelites were a people with a broken spirit. They were a defeated people coming with a defeated mentality.  They felt small. They were thinking small. They were in survival mode. 

But God told them, “Enlarge your territories.”

He said, Enlarge the place of your tent, stretch your tent curtains wide, do not hold back; lengthen your cords, strengthen your stakes. For you will spread out to the right and to the left… (Isaiah 54:2-3)

The Israelites were a conquered people with a conquered spirit. Yet God says, “It’s time to conquer. You’re not conquered, you’re a conqueror.”

God wanted them to make a switch: From small thinking to big thinking.

Friend, you may be like the Israelites. 

Perhaps you’ve been defeated by your problems. Recently, you’ve been hammered by trials. And you have a defeated spirit. You see yourself as a small person. And you feel small. And you’ve been thinking small in your job, or in your business, or in your family life, or in your ministry. 

God is telling you now, “Don’t think small. Don’t think survival. Instead, think big. Think growth. Think expansion. Enlarge your territories. Because I want you to use you to bless the world.”

Be like Jabez. He prayed a unique prayer…

Jabez cried out to the God of Israel, “Oh, that you would bless me and enlarge my territory…” (1 Chronicles 4:10)

When I read that verse, I think of my friends Rolly and Donna España.

Love Big

Rolly and Donna are fantastic business people. 

God blessed their businesses so much, they were able to build a gigantic house in Laguna. 

Let me give you an idea of how big their house is: It has an elevator. (But I was mildly disappointed it had no ATM machine.)

From the surface, it’s totally illogical why they have such a humongous house. Because Rolly and Donna don’t have kids.

But here’s the logic: When this couple hears about one of our ministry teams planning to have a retreat, or a seminar, or a workshop—Rolly would raise his hand and say, “Please use my house.”

If the retreat is 3 days long, Rolly and Donna would be there for the entire 3 days, to cook for them, serve them, and meet all their needs. They haven’t only opened their home, they’ve opened their hearts.

They have no biological children. But they have many spiritual children.

Here’s my point: They enlarged their territories for others.

       Claim these words from Daniel. But those who know their God shall be strong and do great and mighty exploits. (Daniel 11:32)

There’s really only one thing that prevents us from expanding our territories: Its Fear.

Fear is the biggest thief in the house. It has been stealing your dreams away.

Let me share two common fears…

1. Fear of Discomfort

We live in a culture that worships the god of convenience.

In our culture, convenience is the most important thing.

Don’t get me wrong. Convenience is a gift from God. Thank God for convenience. 

Once upon a time, it took 6 months to go to America. Now, it takes 10 hours.

Once upon a time, we wrote handwritten letters—and it took a few days, sometimes weeks, for our letters to reach our friends. (Prehistoric days.) Now, we can facebook them in a snap of a finger.

Once upon a time, you had to call up people via a landline phone. If you’re my age, you remember the rotary phone that took forever to dial. “Zip, Rrrrrrrr….”   And if you’re my age, you also recall that you also had a “partyline” (usually your neighbor). If she’s using the phone, you can’t use it.

Oh, thank God for convenience. Thank God for cellphones. Thank God for digital cameras.  Thank God for google. Thank God for Ipads. Thank God for 24-hour pizza delivery.

But here’s the problem: The moment convenience becomes the most important thing in your life, that’s the moment you stop growing. That’s the moment you stop expanding.

Life begins to atrophy. Decay. Disintegrate.

Here’s the truth: Expansion and growth and development can only happen if you do the very opposite of convenience—which is sacrifice.

Convenience is nice.   Enjoy it if its there. But throw it out of the window when your big dreams are at stake.

Sacrifice!

Success Requires Sacrifice

Are you married? If you want your marriage to work—you’ve got to sacrifice. Many marriages aren’t working now because the husband and wife just want convenience more than anything else.

A marriage cannot be based on convenience.

Raising kids cannot be based on convenience.

Having a great career cannot be based on convenience.

Building a business cannot be based on convenience.

Growing your investments cannot be based on convenience.

A healthy body cannot be based on convenience.

Expanding your territories can only be based on sacrifice.

Here’s another common fear that prevents you from expanding your territories…

2. Fear of Failure

Let me tell you a story.

Julio was a new salesman. Despite of the fact that he would go house to house every single day, he couldn’t make one sale. 

So his sales manager called him and asked him, “Why can’t you sell?”

Julio said, “I don’t know why. Bad luck, I guess. I stand in front of the door waiting for someone to answer, but no one opens the door. So I go to the next house.”

After a few more questions, the sales manager discovers the reason: Julio would go house to house, standing in front of the front door, but he would never knock. He would just wait for it to open.

Why? He was afraid. He was afraid of failure. He was afraid of rejection.

Are you like Julio? Do you also simply stand in front of the door of opportunity—and don’t even knock? Have you been passing up so many doors of expansion, because of a fear of failure?

Knock!

Do something. Try it out. Dive in. Wet your feet. Experiment. Fail a few times.

Please know: To think big, you don’t act big. In fact, I strongly recommend that you act small. Because I assure you that in the beginning you’ll be failing first. So act small so that your failures are small.

There are two kinds of big thinking.

1. Big thinking that comes from big ego.

2. Big thinking that comes from big love.

Let me tell you the difference.

One Thing To Check 

       Do you want to know if big thinking comes from big ego? From pride? From insecurity? From a need to prove yourself to others? From a need to buy other people’s love? From a need to cover up one’s unworthiness and inadequacy?

Look for one sign. Look for the presence of hurry.

If there’s hurry, there’s a 75% change that big thinking came from big ego.

For example, you’ll think big and act big right away.  Because you’re in a hurry.

But if big thinking comes from big love, you’ll think big and act small at the start. Because you’re not in a hurry. Because whatever you’re doing is not about you anyway. It’s about serving others and blessing the world.

If it’s big ego, you’ll think big and grow fast. If it comes from big love, you’ll think big and grow naturally. Not slow. Not fast. But naturally.

When Hurry Destroys You

       You can’t hurry a woman’s pregnancy. 

It’s 9 months or bust.

Not 6 months, 7 months, or 8 months.  If a baby comes out before the 9^th month, it needs to be in an incubator. Its health is in danger.

Nor should the baby stay in the womb after 9 months. If the baby overstays in the womb, it’s dangerous to both the baby and the mother.

Do you know that some of the food that we eat is dangerous to our health? Why? Because we hurry the natural process of growth. 

For example, a native chicken takes 3 to 6 months for a baby chick to become an adult chicken. A regular chicken takes 45 days. But today, some only takes 28 days. How do they do it? They inject the chicken with massive doses of growth hormones—chemicals that throw our own hormonal system off balance. Some believe that these chemicals can cause cancers.

You’ll Lose Money If You’re In A Hurry

The reason why a lot of people fall for terrible scams is because they’re in a hurry to grow their money. This is also the reason why people gamble and lose all their money—because they’re in a hurry to grow their money. (This is the reason why I tell people to “invest” in the Stock Market, not “trade” in the Stock Market. Those are two very different things.)

In business, it’s the same thing. I’ve learned not to rush expanding my business. Instead, I just let it grow naturally. I avoid so many problems. And I avoid useless stress.

Expand Your Territories—

Because It’s Not For You Anyway! 

 Be the best that you can be.   Grow. Flourish. Expand. Because it’s not for you anyway.

Think big, love big!

May your dreams come true,

Bo Sanchez