Azi sent this comment on my previous post on Costly mistakes when using a credit card.
Can you please explain the computation (of finance charges)? How can my interest become higher than 3.5%?
Most Philippine credit card companies compute finance charges using the average daily balance method. Here is an actual example. Don’t ask me who owns this credit card 
:
Noet Ravalo wrote an excellent piece today on scams and how to do a quick sniff test so that you don’t end up being victimized by crooks.
An email writer also tipped MoneySmarts about a company that’s offering investment schemes with fantastic returns. I’m in a fighting mood today, so let’s see if this company passes our smell test. After all, if a company offers a legitimate investment option, it should be able to survive public scrutiny, right?
The company goes by the name Suise Financials, oddly similar to the name of Zurich-based investment bank Credit Suisse Group. Don’t confuse the two. They are not related.
I’m playing catch-up with a grin on my face, seeing that this blog has been active despite my absence last week. What a magnificent thing it is to see people sharing experiences, knowledge, and skills unselfishly with each other. Thank you!
Last week, INQUIRER.net’s personal finance section featured an article on money lessons for children. Some of the advice may surprise parents. Instead of the traditional “teach children how to do with less”, the article talked about giving children extra allowance so they would learn to budget their extra money. It talked about teaching children the importance of saving, investing, keeping good records, of being content with what they have, of being good stewards of their belongings, of learning how to give to others and enjoying the fruits of their labors so they will not turn out to be misers.
Good, basic advice. Unfortunately, they will all be useless without consistent practice. Let me explain.
I was exhausted, cranky, in need of a long, warm bath and some chocolate bars to perk up my mood. Worrying about someone in the family who is sick, especially if that person is a baby, does that to you.
But the voice of the man near the admission counter of the hospital where my son was admitted pierced the cloud of selfishness around me. He was obviously in pain. And he could not get a room at the hospital.
“I’m sorry, sir. We don’t have a room for you. You can wait in the ER until we have a room that fits your card,” the clerk said.
I’M blogging from my son’s hospital room. He was admitted this morning; his baby body unable to cope with the huge volume of phlegm in his throat and lungs. As I went through the motions of admission, one question kept going through my mind: does brand matter?
Conventional wisdom dictates that frugal living and money smarts have to do with beating marketers at their own game. Companies spend millions to build a brand. They hire professionals and pay them seven-digit salaries.
These professionals crack their brains to create a story that would make consumers part with their money.
From one of my favorite business authors and speakers, Seth Godin:
When you are sitting right on the edge of something daring and scary and creative and powerful and perhaps wonderful… and you blink and take a step back. That’s the moment. The moment between you and remarkable. Most people blink. Most people get stuck. All the hard work and preparation and daring and luck is nothing compared with the ability to not blink.
This quote transfixed me. That moment can be when you’re faced with a tremendous investment opportunity, a chance to get into a business, an offer that’s wildly outrageous and yet resonates with all that you hold dearly. That moment can be about family and financial security. Do you blink or do you get stuck?
Life for Sheldon, 26 and single, has never been this exciting. After a job as community educator for a property company, a few years as a marketing consultant, then a stint in several publications, he was hired by two Internet publishing companies to handle some of their projects. His income quadrupled almost overnight to P60,000 net of taxes. What would a 26-year old do with all that cash?
“I went crazy. I bought a P93,000 laptop and other techie gadgets. I bought a 350D camera and two lenses. I went out many times a week. I started traveling. Then I read MoneySmarts and I got very scared. I realize I was spending too much and I needed to be sober,” Sheldon said.
Sheldon doesn’t know it, but he is a financial planner’s dream client. He’s young and can therefore take advantage of the power of compounding, where interest on his money can earn more interest. He’s not lusting after designer clothes, fast cars and a condo of his own. He even bought a variable universal life insurance (VUL) for himself with a P1 million face amount – and that was before he started getting concerned about his finances.
I don’t know if this story will make it to newspaper dailies tomorrow. What I do know is someone is very bullish on the Philippines.
JP Morgan is a global financial services giant, Wiki says one of the oldest in the world. In May, it was third in the Philippine Stock Exchange’s broker ranking.
Last month, it held its first investor conference in the Philippines since the 1997 Asian financial crisis. Now, it’s saying the key Philippine Stock Market index (PSEi) may reach 4,400 by mid-2008. Reminds me of the “blue skies” foreseen by Association of Securities Analysts of the Philippines (ASAP) president Francisco Liboro. He said in this article that once the market hits 3,700, the sky’s the limit. That means the market will be in uncharted territory.
Financial markets are fickle animals. They can turn anytime. Plus, there are too many things that affect them, not just in our country but movements of other markets. So, whenever I hear forecasts especially on the peso-dollar exchange rate, I listen to them but with more than just a grain of salt.
But I’m addicted to asking my sources for their forecast. Picture me with my clunky recorder (I still use that kind, not the minuscule ones newbies carry nowadays), lunging after a financial market expert attending a conference, tugging at his sleeves, stepping on his toes – whatever I can do to catch his attention because I’m not even five feet tall – and asking, “Sir, sir, what’s your forecast on the peso?” with my notepad and big fat ballpen already in front of me. Sigh. Journalists are mixed up persons!
The truth is, I have been trying to get my sources to give me their projections for the peso-dollar exchange rate. So far, the most remarkable forecast is P44 to the dollar. Did that shock you?
Your budgeting system is probably perfect. I only have great admiration for you if you can track your spending religiously and can put our expenses in little boxes that never overflow. I truly do.
But I have long discovered that a rigid budgeting system doesn’t work for me. I’m not a fan of painful budgets for the Duplito household. I wrote all about that in an earlier post. But I do know life will be miserable if I blow money monthly on each little whim. I need to find that sweet spot somewhere between responsibilities and fun.
I discovered this sweet spot is all about giving myself guilt-free money. This is how this plan will go. Let’s say I earn P100,000 on a book project. Let’s say the gods have seen fit to give me a new project to work on this year on top of my very cool project called MoneySmarts. I ask myself, what portion of that amount can I spend without feeling guilty?
