Author: CFG

Hi! I am a Certified Public Accountant, Qualified Mentor of the Philippine Center for Entrepreneurship, and a Personal Finance Enthusiast.

Creating Wealth

Creating wealth isn’t as hard as many individuals think. Many individuals think that generating wealth entails coming up with different things and being progressive. What you need when making wealth is the highest possible reward with the lowest downside risk. Fact is nobody else is going to create wealth for you. Forget people selling Multi-level marketing schemes and get rich books for hundred bucks – it isn’t you who’ll get wealthy. It is them. Creating wealth is on working smart not working very hard. In addition avoid managed investments the cause individuals provide to manage your money is that they cannot do it themselves therefore no mutual funds, hedge funds, managed FOREX etc. You’ll put the money where it grows rapidly and materials with low risk. This implies making your money to work for you to earn more money. Howard Hughes achieved it, Donald Trump does even comedian Bob Hope did it and so do majority of the world’s wealthiest investors – They committed to land. It got large profit potential to risk and land is inexpensive and easy to invest in – It is the perfect investment to earn money fast. Since Americans are buying property in growing number of up to 70% less than in the United States and these qualities need to be constructed on prime land. In certain nations land values are flourishing and several individuals are making money fast. Is it surely possible to make triple digit increases with low risk. In Costa Rica for instance many investors are making 100% annual increases with low risk and their getting rich. This trend is increasing and will continue as baby boomers look for vacation houses and retirement houses and a slice of heaven at an inexpensive cost.

Grow Your Money

Investing means putting your money in a company or in different kinds of businesses on a short, medium, or long-term basis with an expectation to earn something in return. Basically, investing simply means allowing your money to work for you. This sounds so great to read, but, how and where should you invest your hard-earned money?

1. The Art of Saving

Before you could go for investing you must learn its solid foundation which is the art of saving. This is very important because going directly to investment without its basic knowledge will only lead you to lose your bunch of money.

To learn the art of saving you may apply the Abundance Formula of Bro. Bo Sanchez which is the 10-20-70. Once you received your income or your salary divide it immediately into three part prior to spending. The 10% of your salary should go to GOD. The 20% should go for saving and investment. Lastly, the 70% will go for your expenses. It’s not necessarily that you must follow the 20% and the 70%. What’s important is you follow its principle, to learn this formula you should always put in your mind that you don’t have the right to spend unless you divide your salary into three.

2. The Emergency Fund

The main goal why you are saving is to build an emergency fund, which is equivalent to your three (3) months of your salary if you’re single and six (6) months of your salary if you’re married. The concept of Emergency Fund is very important because this fund is used for unexpected circumstances which lead you to urgent spending. Additionally, some percentage of this fund should be placed in a Bank and some should be placed in your home for immediate access. In order to know when to use your emergency fund, make a list of possible emergencies that you may encounter. If something happens and it’s not included in your emergency list, then don’t deep into your emergency fund. Remember, A “SEAT SALE” is not an emergency!

3. Heath care and Insurance

Together with the Emergency Fund, it’s also very important to either have a long-term health care or insurance for the breadwinner. If you’re investing without any of these two, there’s a possibility that you might end up losing all your investments. In the situation that something happens to you which you could not afford its expenses, you may be forced to redeem all your investments regardless of market condition.

4. Know your risk Appetite

Before you begin your investment, you must also know your risk appetite. If you’re the person who has a conservative risk then, it’s recommended that you invest in mutual funds because an investor can choose its risk appetite. On the other hand, if you’re the person looking for high earnings, then go for the stock market. Just put in mind that the higher the earnings, the higher the risk.

5. Long-term Mindset

If you already have the four, then you can already start your investment, but, just make sure that you have a long-term mindset. In simple words, you’re going to invest your money beyond five (5) years. Having a long-term mindset will help you minimize the risk of your investment. Aside from this, having a long-term mindset means treating your investment as your retirement fund.

6. The Blue Chips
If you make your investment, it’s best if you invest in Blue Chips, these are the companies which have the ability to last for many generations. Some examples of Blue Chips companies are Jollibee Foods Corporation, Ayala Corporation, SM Prime Holdings etc. Never invest in penny stocks for long-term, these companies may have the lowest price but has no strong foundation yet.

7. Diversify your Investments
Diversify your investment, if you have a huge amount of money don’t invest it on a one-time basis instead spread it across multiple legitimate investment vehicles. As they say “Do not put all your eggs in one basket.” One rotten egg may affect the others. The same principle holds true to investments.

Money Tips for Millenials

There are plenty of books about money tips or savings. In this blogpost, I will share some of my actual ways that will surely help Millenials spend their money.

1. Create an Effective Budgeting Plan
You can create a more effective budgeting plan. By doing this, you have to know where your money is going and you should customize it where the money is supposed to spend.
You can create a budgeting plan by asking: How much is being spent on rent, utilities, groceries, debt, and entertainment? Once you have created a clear picture of where your money goes in a typical month you can begin to spot trends and problem areas. After you’ve found the problem areas you’ll have a better idea of where you can cut back and by how much. As you can see, the idea is to paint a picture of where your money is going and is not so much about tracking every single peso you spend throughout the day. Yes, that can also be a helpful exercise to keep spending under control, but that’s also what turns most people off about budgeting; hence, they fall off this discipline after a few weeks.

2. Have a Discipline
This is also the character on how you manage your finances by controlling your expenses at the same time without sacrificing the important aspects of your life. Saving money is not everyone’s talent. The ability to save money is not inborn either. It is something that you have to do with the money you earn. This is respecting yourself after the long hours of work and the dedication to get in to your work premise despite the traffic and the long hours of sacrifices not with your loved ones. Saving money is a long-process and determination. This does not mean, after you save money, you are expected to withdraw it after all the thrifts you did over time. You save money so you can respond to the calling of the most important events of your life and of one’s life may be your parents’ birthday, reunion, education and important health issues. Not to save for luxurious bags, go mountaineering because you often see your friends climbing on a mountain and posting photos on social media unless you take these out from your spare money. If you tend to do and spend money because you would like to follow the trends, stop for a while and reflect upon it. There are several outlets, ways and strategies you can do to save and grow your money. Be familiar with those and learn from those.

3. Seek Professional Advice
It is also a very good thing to seek assistance from professionals. They will provide you some financial institutions where you can save money either in insurance, investments, savings & time deposits, or venture into the actual business. Remember: Before you save money, make sure you are committed about it and you are knowledgeable with the type and the risks of investments you are venturing with. Most importantly, you are passionate about it. No more dilemmas and no more what ifs. Just do it once you are decided to do it. Learn to be thankful for all the blessings you receive no matter how small or big they are. Learn to say thank you to yourself for putting money in the bank or in a one simple thrift can. Give thanks for each day that you earn money because of your hard work. This is the fruit of your labor and you are the only person who is assigned to take care of your finances.
Remember: “Your income is directly related to your philosophy, not to the economy”.