The Stock Market is Going Down....Again

I just learned today that the Dow Jones fell by 394 points at closing last Sept 9, 2016. Most of the time, the DOW serves as a barometer on how the Asian markets will perform, specifically the Philippine market which is represented by the PSEi.

The PSEi already closed out on a losing note last Sept 9, 2016 by 85 points. And with the Dow losing out big time, I won't be surprised that the PSEi will follow suit especially that majority are foreign investors. I wish that the time will come that Filipino investors would dominate the Philippine Stock Exchange.

I mentioned in my previous that I have rejoined the Truly Rich Club. One of the main objective of the club is to teach financial education to Filipinos. The club would like to emphasize that investing in the stock market is not only for the rich. Anyone can do it as long as we obtain proper financial education and guidance.

The club has a shortlist of recommended stocks that the members could buy on a regular basis. That is regardless if the market is up or down. It doesn't really matter. The club members celebrate when the market is down since we can buy shares of great companies at cheaper prices. We are being taught to buy on a regular or monthly basis so we can ride the volatility of the market. We are also being trained to act as Investors and not as Traders.

The role of the club now is crucial as some investors, especially the newbies tends to get carried away by their emotions. We are being reminded of the famous mantra by Warren Buffett that "We must be  fearful when the others are greedy, and greedy when the others are fearful". Long term investors buy when there are a lot of selling going on and are on standby when stocks are getting overbought.

I used to be carried away by emotions when it comes to investments, but now, with the proper guidance and education, I know for sure that I won't be on the wrong side of the fence ever again and I won't miss out on greater opportunities.

The Stock Market is Still Going Down.... What to do Next?

For several weeks now, I saw the Philippine Stock Market on a downward spiral. Though there were a few trading days when I see the market make a rebound, I see it as an opportunity for bargain hunters to buy shares of great companies at a much cheaper price. After bargain hunting, shares plummet once again on the following days.

Others view the current downtrend in the Philippine Stock Market as political. However, based on the global news, it seems to boil down to global economy. The impending increase in the federal tax rates is being anticipated with bated breath.

To long term investors, crisis like this is a great opportunities to accumulate shares since the prices are cheap. This is the time to be greedy since a lot has been so fearful. Fearful because some entered the market when it is going up. For those who waited on the sideline when the market is up, I imagine that they are now like kids buying candies of different variants from candy store. There are lots of cheap companies left and right.

One piece of advice though my friends, always make sure that you buy shares of great companies only. You must invest your hard money on companies which will be around for the next 10, 20 years. Do not put in your hard earned money on penny stocks. Later on, you will become penniless.

Invest wisely. We invest because we think about the future. Live in the present but always plan for the future.

Have a nice day!!! :)

How to become a Saver from being a Spender

Once upon a time I was a Spender. I have yet to receive my salary but it is already consumed because of things that I wanted to buy. The sad thing about is, I bought items with the use of credit. I was not only a spender, I was also a debt magnet.

It crossed my mind that my financial life is going nowhere. I have no investments. I have no savings. Until one day, I decided to change my mindset. Instead of being a spender, I now wanted really bad to be a Saver. I was able to buy books on proper financial management and lifestyle simplification. I needed mentors, and it came in the form of books, audio books, internet articles, etc.

I was never the same after that. I've learned about the prosperity formula. I've never known, that for us to be able to prosper, we must follow the prosperity formula, which was the formula used by rich people.  And that it:

Income - Savings = Expenses

We must live on what was left after we deduct our savings from on our income. Before I used the poverty formula:

Income - Expenses = Savings

The problem about this formula is, most of the time, there was no savings at all. And there were times that instead of zero, it becomes negative, forcing us to incur debt.

It is recommended that we save at least 20% of our income and put it into something which would earn us interest.

Now, I am using the prosperity formula to help me boost my financial life so I can be financially free when the time comes that I already need to retire. I am excited when payday is already around the corner since I know that I can once again transfer funds from my payroll account to my savings account. Saving nowadays became more convenient because of online banking. With a few touch, we can easily transfer funds from one account to another.

But we should not just stop with just saving our hard earned money in the bank. We also need to grow our money exponentially. We cannot just rely on the 0.5% annual interest that our money earns from the bank. We need to beat inflation. And that can only with the use of investments. More on this.

Have a nice time. :)

Proper Use of Credit Cards

When it comes to paying purchases, there's no question that credit card is the most convenient mode of payment since we don't need to bring too much cash in our wallets.

But after using "plastic money", what do we normally do once we get home? Do we pay the credit card company immediately? Or we wait for the billing statement and pay only the minimum and we allow the bank to charge us interest?

I am not trying to make myself clean when it comes to these kind of things because I was once hooked by the credit card mania.  After using the card senselessly, I just waited for the statement and just pay for the minimum amount. There came a time when I no longer know how to pay for it. I got into several loans just to pay for the credit card.  Talking about financial ignorance. I simply did not live within my means. Salary is being spent out even before receiving it. And that it due to the improper use of credit cards.

So after painstakingly developing the discipline, one by one I first paid credits with the highest interest rate.  Cut off cards, with "hidden charges".

Please don't get me wrong, credit card is not evil. It is actually a tool which if used properly may also bring in peace of mind. Personally, credit cards must only be used in emergency situations when we have no immediate available funds. It should not be used to fund our lifestyle.

Right now, I only maintain one credit card and sometimes use it for items such as grocery, clothing, medicines, car maintenance, etc. But I make sure that when I get home, I pay all of it via online banking.  Though there were times that I'm not capable of paying 100%, I make sure that I pay at least 90%. So by that, I maintain my credit at a minimum level.

So think twice if we are a planning to use the credit card. It would be much better if we save for something we wanted to buy. Do not buy on impulse. We might realize later that we don't need that item we wanted to purchase especially if it is a want instead of a need.

One of the use of an Emergency Fund

This will serve as a prelude on my future post regarding Emergency Fund.  I just can't help but to immediately share my experience of how important having an emergency fund really is.

We normally leave the house to go to work around 7AM and we would normally use the car. But to my surprise, the car just wouldn't start. Twice, I tried to start the engine but to no avail. My initial reaction is to pop the hood and checked the battery terminals if it is loose. I disconnected the terminals and put it back in. Tried to crank the engine and it still won't start. The first thing I thought is, the battery is done. However, I didn't experience a hard starting the last couple of days. The only thing I remember is that it had a little jerk when I started it the day before.

Left with no choice, I told my wife to just call tricycle so she can go out of the subdivision. For me, I called on the Motolite hotline and requested for an immediate battery delivery. This time I ordered the Motolite Gold. The previous one was an Enduro.

Fortunately, I had an available cash which really came in handy in situations like this. This is the result of the discipline that I've developed through the years when it comes to money management (more of that in future posts :)). I was thinking of using my credit card but there were time that I'm already afraid of using it due to several incidences of double charging, which is sometimes one of the problems of using credit cards, even if I am going to pay it online afterwards.

Fast forward. The Motolite personnel arrived as scheduled. Tested the old battery and it really needs to be replaced.  Installed the new one an I was able to start the car.  After several testing, I paid the guy and gave him an additional tip for a good service. The good thing about this is I paid in cash without feeling hard about the whole thing.  Even if the battery cost around P5500.00.  That is because I have available funds intended for things like car maintenance.

With this experience, I really would want to encourage everyone to create an emergency fund regardless how much one is earning. It doesn't matter how much we earn. It on how much we save that matters.

My Mutual Fund Investing Experience...so far

I started out my mutual fund investing sometime 2008.  And I admit I started out on the wrong foot. Why? Because I have no idea what mutual fund is all about.  As in zero knowledge. I'm not even keen of doing investment during that time (everything's different now though.. :)).

It so happen that a former boss invited me to a seminar regarding investments. That's the first time I've heard of mutual fund. I was expecting something about stocks and I was introduced to this. You can imagine how confused I am during that time.  Talking about financial ignorance :(. So I shelled out P5000.00, opened an account from the top mutual fund company, and bought shares at P10.7/share and I am now in the world of investments.

I've made foolish mistakes after that transaction and would rather forget everything about it :). There were lessons learned after that.

Fast forward, I am now again an active mutual fund investor. I decided to invest in Philequity as a personal choice, based on its track record. Initially, there was a little inconvenience when it comes to mutual fund transactions, everything is done manually. Filling out forms, going to the bank to deposit funds, scanning the deposit slip and investment form, etc. For a guy who has a regular day job, I don't enjoy such activities.

Fortunately, one of the top online stockbrokers in the Philippines, COL Financial Inc., introduced the COL Fund Source.

                        

                        

A COL Fund Source is like a fund supermarket where investors can simply select every financial instruments which suits their investment appetite.  And the best thing about this is, everything is done online.  Just what I'm wishing for. :) With just a simple click everyone can now have a mutual fund account.  But you have to open an online account at COL to enjoy these benefits. :)

One of the good thing about mutual fund investing is that in a volatile market, you are somehow protected from big losses because of diversification.  A mutual fund is the best way to do diversification on a minimal cost since the fund manager allocates the funds to different industry sector.  And your investment can buy shares up to the last centavo as compared to individual stocks which has a board lot. I'll have a separate sharing regarding my personal direct stocks investment on future posts. :)

So there, as of this time, despite of the recent consolidation or correction, my fund is still doing good. It's still in the green. Reason is I was able to purchase shares when it was still cheaper last April of May 2016. My personal strategy is to buy additional shares during market dips.

Hope you can get something positive out of this sharing.  If you have clarifications, please feel free to comment.

Thanks a lot for viewing and have a nice day. :) :) :)

Why Reading Books Turned out to be a Passion

I am not that fond of reading books. I read stuff such as articles from various sources but not an entire book. I'm not even keen on shelling out money just to buy books. Books tends to collect dust after it has served its purpose.

Something "magical" (yes, I consider it magic :) ) happened along the way which changed my perception on the importance of reading books. A former boss introduced me to a book written by a famous lay preacher. The book was entitled "8 Secrets of the Truly Rich". And it was written by Bro. Bo Sanchez. That book started it all. That book opened my eyes on all the mistakes that I have done when it comes to financial matters. It made me realize that I was financially ignorant.

Several books in my possession

After that, I discovered Bro. Bo's other books on how we can simplify the way we live; that happiness can really be found by living a simple life even if we can afford the comfort and convenience brought by the modern age. I have been living a simple life since then. I have bigger dreams of course. But I have taught myself to set aside those dreams if it would mean complicating my life. I became contented with what I have right now. A simple house, a simple car and most of all a happy and loving family. Simple things makes me happy, which I think is the most important.

That's one of the influences I obtained from reading books, it keeps my feet planted on the ground.

Aside from books on finance, I now read books which gives me inspiration. Something that I really need to keep me pumped up. Especially during times when I feel that things aren't going according to plan. It made me realize that even if things went the other way, there are better things somewhere. I just have to look for the open doors and knock on the doors of opportunities because I believe that every human being were created with equal opportunities. We only need to have the guts to grab it. And once we got it, we just need to nurture it.

See what reading books have done to me, it taught me how to think in a very positive way. I am currently teaching myself to be happy all the time. I believe that a happy person has a happy disposition. A happy disposition results to better decisions. Better decisions result to a bright future.

So common friends, grab a book and be a happy and inspired person.

Have a nice day!!! :)

Lifestyle Simplification

I have lots of plans.  I plan of having another house.  I plan of having a new car since I already paid up my first car loan after five (5) painstaking years.  But if I have to ask myself, do I need it?  Will it make me happy?  How can I afford it?  Honestly speaking, if I am pursue those things, it will be in the form of a loan.  Seems not a good idea. It is not necessarily a need.  I might feel satisfied but it won't make me totally happy.  And getting it through a loan will definitely give me sleepless nights.  Something is holding me back to let go of these plans. What is it?

Sometime 2012, I stumbled upon this book written by Bro. Bo Sanchez.  It was published around 2001.  I only got hold of this wonderful book 12 years after it was published.  I regret not being able to get hold of it much earlier.  I could have experienced a turnaround much earlier.  I shouldn't have done regretful decisions.  I shouldn't have purchased depreciating items with the use of a loan or credit cards.  I could have invested much earlier on valuable financial instruments.  I could have been much happier now.  I could have been living the good life much earlier.

The turnaround might have come at a later time.  But it is not yet too late.  Long before I conceptualized this blog, I took it upon myself that I will make my life as simple.  Life is already complicated, so why complicate it more by unnecessary things.  I could have opted for a flashier car, but I opted for a simpler one.  A flashier car requires a higher amortization.  More money coming out of my pocket.  As much as possible, I stay away from signature items.  I want simpler ones.  I learned to be happy on simple things which is the way it should be.  I now opted to live in a simple home rather get a new one from an exclusive village which can eat up to my budget which I can use for investment and create wealth. Nothing beats the feeling of staying at home and spending quality time with my family rather than spending it somewhere else.  Though we still go out, we make sure that it won't be too often.  Besides, we already have what we need at home.  All the basic needs.  All the basic reasons which makes me happy and want to live the good life even more.  And that is LOVE.

Have a nice day friends. :)

A Truly Rich Club Member Anew

Finally, after weeks of coming up with a decision, I decided to rejoin the Truly Rich Club. Yup, you read it right.  I rejoined the club.  I actually joined the club a couple of years ago. I joined twice and I quit twice.  Guess I'm not that ready to be a responsible club member during those times.  But now, there's no turning back.  I got to do it right this time.  I don't want to be missing out on the great opportunities of being a member of this club.

For those who are asking what the Truly Rich Club is, as taken from its official website, it is a private group of individuals who are serious in changing their beliefs and thinking to gain the abundance mentality they need to change their lives forever.  This would not be possible without the guidance of its well loved founder, Bro. Bo Sanchez

My former boss actually introduced me to this man.  From then on, I became interested with his works.  I bought some of his books especially those which promotes financial literacy and inspirational works.

Now going back to the club, there are a lot of changes.  There are still the all time favorites Stocks Update and Wealth Strategies but on how the website looks.  It became more informative.  The Strategic Averaging Method (SAM) table is being updated real time.  I became inspired once again to make my investments work double time this time around. No more dilly dallying.  I'm not getting any younger. :)

There are additional blessings for the members.  One of those is the 100K Term Life Insurance.  Members can avail of this benefit if they are already a member of the club for one (1) or have fully paid the one (1) year membership.  For those who can afford, I recommend paying for the one (1) year membership in full since you will be saving 20% of the full year membership if you really want to avail of the term life insurance.  For those who are interested, you may join here.

There is a membership fee.  But come to think of it, Bro. Bo supports a lot of ministries.  I just think of it as a form of tithing.  Its a great feeling if we can give with all our heart.

Well I think that's it for now regarding my Truly Rich Club membership.  I am looking forward making the most out of this experience.

And as Bro. Bo used to say, "May Your Dreams Come True". :)

A Perfect Partner

Another old poem I wrote for my wife:

It’s been several years now,

Since we’ve made that sacred vow,

Which binded us together,

Binded as one forever.

But now, here’s the real question,

Have I made the right decision?

The answer is, yes indeed,

You’re the one who I truly need.

I’ve found a Perfect Partner,

Who turns things from worse to better.

We may have misunderstandings,

But from my own shortcomings.

I’ve found no fault at you at all,

You’re always there standing tall,

Facing great responsibility,

Complimented with humility.

With you always by my side,

Life would always be a great ride,

Being with a Perfect Partner,

Whom I’ll always love forever.

A Treasure

I just happened to get hold of an old poem I wrote for my daughter.  Here it is:

Time flies so fast,

Ahead lies a horizon so vast,

A bright future is ahead of you,

And I’ll be there to guide you.

It seems only yesterday,

When I saw you on that special day,

I just can’t hide the excitement,

You've brought on that joyous moment.

 So take your time my little angel,

Cherish the moments with stories to tell,

Stories of love, joy, and pleasure,

‘Cause for everyone, you are a treasure.

 Mistakes surely would be rampant,

So words of wisdom will be abundant,

Words to enlighten you,

As you face the world ahead of you.

 Now, this I promise you,

That I’ll be here for you,

Guiding and loving you so true,

‘Till you make your dreams come true.

One Major Loan Down

Hello There!!!

It's been quite a while since my last post.  I think my last post was October 2015.  It's been ages already.  But nonetheless, so many things happened in between posts and I would like to share one major think that happened just recently.  I just finished paying up my car loan which I took up last June 2011.  Yup, that's right.  I just completed paying up for my car.  And what a relief!!! Whew!!! YAHOO!!!

All of us know that having a car is one of the major purchases that anyone makes even at the expense of incurring a loan.  Well, it's understandable.  Paying up for a new car in cash is quite impossible for the average individual like me (please call my attention if someone disagrees :)). Unless if I'm rich, I don't think I can pay up for a brand new car in cash.  At least not yet.

Whether it's a brand new or a second hand car, it is up to the person to decide on what to purchase since both still requires maintenance checks from time to time.  The advantage of owning a brand new car is the fact that you will be the first owner and you will be the first one to drive it out of the dealership.  Purchasing a second hand car requires patience since you need to check the history of the unit.  Failing to check up on important items will just give you headache.

I received an advice from someone that once the car reaches five (5) years, dispose it immediately since the maintenance tends to be costly after 5 years.  I beg to disagree.  At 40Kms plus, I don't think the car would just bog down like that, especially if it is casa maintained.  Would it be more costly if you will have to pay for another car loan for the next five (5) years rather than just saving up your additional income from the completion on the load and use a portion of it to properly maintain your car?  I would rather choose the latter.

A brand new car also needs regular maintenance check-up.  And maintenance checks at the dealership also takes away money from your pocket.  That's what I call practicality. Incurring another major loan on something which immediately depreciates is, for me, not a wise decision.

I would rather use that additional cash flow on something else which will make my money grow and on something which will make me wealthy.  And that is Investing.  More on this. :)