As you well know, I don’t like budgets. Just thinking about them makes me wince. I have tried, but really, I cannot pretend that I already have the hang of it. Just can’t.

Before you think that I spend irresponsibly because I have junked the traditional concept of budgeting, let me tell you what works for me. I simply figure out how much I should save and invest, then spend the rest. That’s it. I enjoy the moolah. Let the money chips fall where they may. I can smile while forking over money at the restaurant because I know the purse strings keeping the savings fund are tightly shut.

That’s just me, though. I understand and absolutely admire who religiously jot down their expenses and add the figures up in nice little columns. As I always said, financial planning requires a customized approach. If that is the approach that works, then it’s the best one.

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A quick run through on what Gloria promised during her recently-concluded State of the Nation Address.

• Marginalize poverty by 2010
• Increase the middle-class
• Continue to create one million jobs every year
• Stronger and wider social safety net
• Cheaper medicines
• More houses
• More good schools
• More well-paid teachers
• Good quality books
• More scholarships
• More language instruction to sustain the Philippines’ edge in the BPO industry
• Investing P150 billion in education this year, P29 billion more than last year
• Sending 600,000 scholars to school this year
• Create a P4 billion fund for college loans to increase beneficiaries from 40,000 to 200,000
• Set aside P1 billion for TESDA this year, up from P600 million last year
• Provide P1 billion for DoLE for trainings
• Set aside P3 billion for science and engineering research
• Set aside P50 billion for Pag-IBIG Fund’s home lending program until 2010
• No new taxes until the end of the year

Priority bills:
Cheaper Medicines Bill
Electric Power Industry Reform Act (EPIRA) *Amendment

Quotable quotes:

“We have spent more on human capital formation than any time in the past. Why? If the government is not for the people, it is a mockery of democracy.”

“I would rather be right than popular”

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From Norma:

We are ofws and we attended a seminar given by one bank 2 years ago and their forecast then is that the dollar will go up to 70-75 range. What will happen if I change our savings now in to peso and then dollars will go up to 50 again.. We are so confuse so better not to look at the exchange rate. Our govt. kept on telling we re heroes but kpt on bleeding us to death.

From surebull:

Well, with the way things are going now I don’t think we have a choice. We have to stick to our peso investments because it seems that Glorieta is determined to hold the Peso below 50. SONA is coming and she will certainly boast it there the peso appreciation. I am not sure however if she realizes that what she’s doing is actually hurting some sectors of our economy particularly exporters of goods and services. I just pray that the “positive impact” of strengthening peso will be felt by the masses in their daily lives, but everyone knows the reality.

Allow me to address your questions directly in a blog post. I read a lot of emails to me that air out concerns similar to yours and my heart bleeds with sadness at the things that misunderstandings can create. Let’s get angry with the right persons for the right reasons. The flip side is to give credit where credit is due. We can use human energy much more effectively that way.

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You don’t have to save the cheerleader to save the world :-). You can even save money while doing it, so says the Live Green Movement.

So here are some more tips on reducing energy and water consumption that’s also easy on the checkbook, in addition to the very informative links from qwerty.

Living green at home.
A sizeable 46 percent of energy use is energy loss. That’s electricity being consumed for no productive use, such as when you keep your cellphone charger permanently plugged into a wall outlet. By keeping unused electronic appliances truly switched off, you save more than 1,000 pounds of carbon dioxide and around P12,500 a year.

Ortigas skyline last July 14. Photo from PDI.

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Yep, most of us will groan and others will probably cuss at our Meralco bill for July. Meralco is charging us P1 more per kilowatt-hour as omski pointed out. Here’s the Philippine Daily Inquirer article on that, omski

I’m posting on a weekend, so mommies and daddies and whoever is reading this blog, let’s inspect our homes to see which nook and cranny is consuming more power than it should. These tips come from the Live Green Movement. Sorry, I can’t find their website.

Use rechargeable batteries.
The sticker price is higher but rechargeable batteries will save you 10 to 20 times the cost of buying disposable batteries over and over again and cuts down on toxic trash.

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I was so intrigued by implied forward rates that I asked Noet Ravalo for more explanations. Here is his first guest post on MoneySmarts:

Let me put my teacher cap on. Example na lang. Mas madaling intindihin. What if investor has P1 million to invest. Choices are a peso one-year Treasury at 6% versus a one-year US Treasury at 4%. What will investor do? Answer = he needs to read Salve’s blog to find out what implied forward rates will do.

Let the peso-dollar rate be P50 to one so that the P1 million is $20,000. For as long as peso returns are higher, the investment decision is obvious (go with peso treasury). But what comprises the return are (a) the outright interest and (b) the value of the currency upon maturity. So, “return” is interest rate LESS depreciation.

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Do you often feel that itch to check how the peso is doing? Are you dismayed every time the peso strengthens (thanks for the correction, Gretch!) further against the dollar, worried that your earnings in dollars are losing value?

Are you exclusively focused on the dollar?

Are you still depending exclusively on one type of investment like real estate investments, or time deposit placements etc?

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As a starry-eyed bride back in 19-something, I told my husband: “When we make our first million, what do you think about putting up a school for street children?”

The world was unraveling before us. I felt like I could conquer the world. You know the feeling :-). I admit there are still fleeting moments now when I still feel that I could.

Unfortunately, no one quite explained to me then exactly how I could make my first million. An article to be posted today (already posted. Click here to read the article) in INQUIRER.net’s Personal Finance section puts the strategy down pat. It details how much you need to save, with a few return-on-investment scenarios in mind. It talks about the science and art that is needed in making your first million.

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The Bangko Sentral ng Pilipinas on Thursday decided to cut its key interest rate and, at the same time, scrap what it calls its “tiering scheme.” This scheme pays lower yields on large short-term deposits, and was used as a tool earlier this year to cool down the red-hot growth of money circulating in the economy.

Why should personal finance enthusiasts closely follow what the central bank does with its interest rates?

At first blush, articles on monetary policy and interest rates seem to be fit only for bankers’ ears. However, since money supply is one of the most important indicators in the Philippine economy, it has a big impact on financial markets and, eventually, on all our savings and investments.

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So, you made money in a Ponzi scheme. It was a gamble you took and you went into it with eyes wide open. No big deal, it was your money anyway.

However, chances are you convinced your kumare, your cousin, your officemate, and your driver. It was their chance to get rich, you said. Hey, they made some money too — for some time. Unfortunately, bad people like the media and the government tried to get their cut and the entire thing went up in smoke. You shrug and say, I only invested what I could afford to lose.

Sorry to say, the happy story does not end there.

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