My husband and I went crazy at the DIY Handyman shop over the weekend to buy stuff for the house, so we had quite a stack of things to pay for at the cashier. I knew we probably overspent, but the bill still surprised me when it reached P9,000 plus.

I paid for the bill and then asked for the tape receipt. Rugs, check. Two different sizes of hooks, check. Car cleaning stuff, check.

“What’s this item that costs P4,200?” I thought my voice sounded really calm.

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“Everything’s going to be OK.”
– Nick Vujicic

Such simple words have never been uttered with so much impact as when they came from Nick. Watch the video and see why.

Nick graduated with a bachelor’s degree in Financial Planning and Accounting, and is a stock market and real estate investor, and a philanthropist.But his greatest asset is his sense of humor.

Consumers needed a little break, what with the tense September to October months and worries about whether the sky is falling down and whether jobs will still be there next year. Thankfully, there have been a lot of good news this week and Christmas seems a lot less gloomy. Here’s your weekly roundup, to help those who feel like they have missed out on some news items this week.

Personal Finance:

Principles the crisis hasn’t changed
INQUIRER.net columnist Johnny Noe Ravalo points out that investors and savers have to understand that crises are part of life and that there is simply no way to perfectly see the future.

“Lehman was after all an AA-rated credit so who would have imagined what would become of such a venerable Wall Street name. This human limitation is the best reason why we should be saving. We should save because it is the only way we can transfer purchasing power from when we have a surplus to when we may suddenly need more of it. In other words, saving during normal times helps us manage the difficult times. When difficult times kick in, our financial plans often shift to prioritizing liquidity over profitability. Unless we have a fool-proof way of either marrying into or inheriting liquidity just at the right time, we simply cannot maximize liquidity when we have no saving to speak of in the first place.”

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Later on this evening, you can catch me on Lucy Torres’ show, The Sweet Life (QTV 11), where we talked about how to live on a budget without going “losyang” as Lucy herself calls it.

It was an interesting evening when we taped the show, as I had a front row seat watching fashionistas talk about how they have fallen prey to the urge to splurge (but have since learned their lessons).

Giselle Sanchez, a schoolmate at UP Diliman, was as usual funny, smart and very much honest with her spending binges. She talked of how she ended up buying almost all of the bags in a Louis Vuitton shop in Italy (guess how much it cost her), because the snooty manager tried to boot her out of the store because he mistook her for a Filipina domestic helper. (You must watch the show to fully appreciate her effort—albeit costly—to defend Filipinas).
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Photo courtesy of Aladdin Cordero

I learned a few more things while preparing for my interview at ANC’s Shoptalk, as well during the show and would like to share them with you:

1. Use a budget. Makes you consciously think of what you put in your shopping carts. Write a shopping list.
2. If you must shop, go for frugal shopping hot spots. The psychological rewards of saying yes is the same whether you do it at Zara’s or Divisoria. (Read my previous post to to find a list of frugal shopping hotspots.)
3. Set aside a Christmas fund. In government finance, a sinking fund allows the government to set aside every month some money for future payments. We can do the same in our personal finances. A 12,000 budget for gifts and noche Buena every year for example will not be as heavy when you prepare for it by seting aside 1,000 a month from January to December.
4. Don’t forget the “hidden costs” of Christmas holidays, like contributions for company/church Christmas parties, Kris Kringles for children, etc.
5. The law of supply and demand in economics indicate that if you buy in January, you will get lower prices because demand is bound to drop. Not so, says Pia Hontiveros-Pagkalinawan, who is a self-confessed Divisoria shopper. She says apparently shop-owners have realized that children who get cash gifts during Christmas time go shopping in January!
6. Be a bulk customer: contact your company’s suppliers
7. Recycle gifts
8. Keep Christmas parties simple, go potluck!
9. Think of giving the gift of experience instead of toys
10. Don’t go overboard when buying toys. Some of the most expensive toys these days kill children’s imagination

Is there anything wrong with enjoying the spirit of the season that’s fast approaching? Of course not. We wouldn’t want people to think we are misers who are only concerned with the glint of money.

There is nothing wrong with enjoying what we earn. But therein is the key—the words “what we have already earned.” We should be enjoying in moderation past income with some set aside for the future. But Filipinos have to stop enjoying future income, future bonuses, future salary increases. After all, what if these don’t come in? Then we have to live with the reality of bounced checks in January or missed credit card payments when the new year rolls in.

Break the cycle by refusing to mindlessly spend. The psychology of spending is a topic that I have been studying for quite some time. Unless we face the deeper reasons why we get into debt come Christmas season—and even after—we cannot really get rid of these urges to splurge.

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ADVISORY: Catch me live today on ANC’s Shoptalk with Pia Hontiveros-Pagkalinawan at 3 p.m. to 4 p.m. to talk about the psychology of spending (one of my uber-favorite topic) and how to hammer down your Christmas budget.

We all know the urge to splurge bites everyone strongest during the Christmas holidays or as the colder months come near. But we also get little scratches and bites all year round! Just look at all the stuff (most of which are useless after a month) that we accumulate through the years! The best thing would be to control the urge, of course. The next best thing would be to shop in the right places.

Lately, I have discovered new frugal shopping secrets in Metro Manila, but to my delight, somebody else has been thinking about the exact same thing. Blogger Paetechie/Tutubi, who owns the blog Budget Travel Philippines (among other blogs), practically read my mind when he emailed me yesterday about his blog post “Manila Shopping Guide and Tips: Divisoria, Malls, Markets and the Art of Haggling”.

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Photo courtesy of Red Monkey

(To the tune of “My Way” karaoke-style)

And now, the end is near,
And so I face my final buying.
My friend, I’ll say it clear,
The bounce will come, oh who am I fooling.

I’ve lived a life in greed.
And now it’s time to live in fear.
And more, much more than this,
I did it my way.

Regrets, I’ve had a few;
Just like when I did not sell Petron
I sold, all that I owned
And bet it all, all on Omico.

I read technical charts;
And listened to my fund adviser
But more, much more than this,
I did it my way.

Yes, there were times, I’m sure you knew
When I borrowed money from you
But through it all, when I would lose,
I ate lugaw or Lucky Me.
I faced it all, and I stood tall,
And did it my way.

I’ve loved, I’ve laughed, I’ve cried.
I’ve had too big a share of losing.
And now, as tears subside,
I will commit my suicide.

To think, I did all that;
And may I say – not in a bright way,
No, oh no not me,
I did it my way.

For what is a man, what has he got?
If prices dive, then he has naught.
To say the things he truly feel;
And yes, the words of one who kneels.
The record shows I took the blows
And did it my way.

–original verses, written in the spirit of fun, by a financial planner friend who asks not to be identified.

Dyandyararandandan! Score: 100 shares in Omico

If you haven’t had time to read the business papers this week, at least read the articles below so you can catch up

My recommended readings for the week still have the tang of the US financial crisis and market upheavals, but indicate that even after screams of dismay due to the crisis, life goes on. People still have to figure out the answers to the usual concerns of someone trying to go on with life like whether it is smart to invest in a memorial plan, or how much insurance is really needed.

The government and the private sector are, as always, trying to find ways together to insulate Filipinos from the crosis (or at least make it appear they care :p ). Some of the items you will find in the news portion are positives for the Philippine economy, some are not. Hope these help you make informed decisions in the coming months.
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