The year is almost about to end. Iâve been thinking about the top personal finance lessons we can glean from 2008. Here are mine. If you want to share your own lessons, write via the comment section or email me at lightdream (at) gmail (dot) com. I will feature the best ones in my article for Business Monday at the Philippine Daily Inquirer.
- Crisis-proof your finances. Donât put too much money in one investment. Diversify. Invest only what you can afford to lose.
- Plan for the long-term, but revisit your goals regularly.
- Donât be too greedy. Know what youâre getting into. If you donât understand something, ask for plain English explanation and if that doesnât work, just walk away from it.
- Live within your means.
- Money is not everything.
1. Be Humble. Being humble in the face of uncertainty, especially now, keeps one from costly mistakes. One shouldn't jump on yesterday's bandwagon. And before one invests, he'll be more likely to ask a key question: "What if I'm wrong?"
2. Borrow Responsibly. Face this truth: If you let them, lenders (though not all of them) are only too willing to advance you more than is good for you or your family. Loan sharks most especilly dont care if your monthly payment makes it impossible for you to sock away money for future needs like savings, retirement etc. Donât spend money fruitlessly, and most importantly, donât spend more than you make.
3. Have an Emergency Fund. The first step in constructing any serious financial plan is to create an emergency cash fund--ideally, three to six months' living expenses. Without this financial cushion, any unexpected expense can derail your long-term plans.
4. Save Your Money. The smartest words ever said by anyone: âA penny saved is a penny earned.â Start small. Donât give up. Donât dip into your savings unless itâs an emergency. Every little bit helps and every little bit counts, thus it is very important that one takes this financial advice seriously, get out of debt and save money - and start saving it now.
5. Prioritize Your Payments and Expenses. Just as it pays to invest your money wisely, it also pays to make your debt payments wisely. And in some cases, it makes sense to pay your minimum debt payments and invest your would-be debt payments in something else.
6. Dont Panic. The market will have its ups and downs, but once you've followed the advices above, you know you'll be ok.
Do not go for the names alone. Look for the track record. It is like buying from Divisoria against SM. You will be surprised to find out that some of the items in SM came from Divisoria at 3x the price.
Be curious. Investigate. Ask questions. The problem with our culture is that we equate asking to dumbness. There is a division between asking smart and asking a stupid quastion. Einstein is genius because he is curious.
http://mytwentyfivecents.wordpress.com
Great tips! the key is to diversify. Never put all your money in just one investment vehicle no matter how attractive or profitable it currently is. You will never know if any problems may arise in the future.
1. "Give before receive".
2. "Protection before infection".
3. "Learn before earn".
4. "Needs before wants".
5. "Sow before grow".
and of course
6. "Hi before Goodbye!".
Prepare a budget and never go beyond it.
Hi! Salvi,
When I was young (sixty three summers ago), I used to hear from my father: "Dapat, pag may hanap-buhay ka na, lima (5) din dapat ang iyong bulsa." At the time, his words were like passing winds.
The wisdom of my father words did not sunk in until I took years ago courses on financial planning. For your readers' information here are the five (5) purses my father had alluded to me.
1. Learn how to budget and manage risk.
As the saying goes, "It's not how much you earn, it's how much you keep that counts." Protect your family and your property by insurance coverage. Buy term and invest the difference.
2. Investment planning. First, learn financial lingo. Understand risk-reward ratio and your risk tolerance. Consult financial adviser who have good reputation and track record.
3.Income tax planning. Must know the difference between tax avoidance versus tax evasion, otherwise you'll ended like Al Capone. Consult a CPA for advice.
4. Retirement Planning and Employee Benefits. To maintain a long and happy life is just a fantasy without enough dough to buy preparation-H or Viagra.
Start saving and investing while on your prime. Dollar cost average via a good manage mutual fund. Take advantage of your company's pension or benefit plan. Maximize your contribution if budget permits. Have discipline in sticking to your plan but consult with your financial adviser at least every six months for strategic review of your portfolio.
5. Estate Planning. Heto na and ultima. Pag nag pantay na ang Paa. Usually only the rich and famous have this. But it's for everyone who have the four purses mentioned earlier This is how the SLN (sumalangit nawa) would still be able to control his loots (if you're a TRAPO), and allocate the same to his beneficiary by way of Will or Trust. Consult a Lawyer who specialized in this field of practice for detailed information.
The foregoing are only brief views that needs critique by experts or practitioner
in Financial planning.
Please pass it on. Salamat.
hi,
i'm clueless about how to manage my finances. i don't have ANY clue about what to do with my start-up savings. i have just started working so i don't have much money in the bank. i want to invest come 2009. but i don't know how to start. do you have any suggestions on how i can kick-start a better financial life?
My mantra during these turbulent times: Distinguish between a need and a want.
Establishing a buying habit based on needs versus wants requires us to be brutally honest with ourselves. We must constantly evaluate what we see, hear, and even what we think. Do you really need the latest iPhone? The 50 inch flatscreen?
Learning to say NO is hard to do especially we are bombarded left and right with clever marketing campaigns telling us what we do and do not need. However, it is essential if we want to enjoy a comfortable lifestyle without the the debt collectors hounding our homes & offices.
1. Stay healthy.
2. Live within your means.
3. Write and set financial goals yearly
(investment of X, savings of Y)
4. Have simple lifestyle.
5. Deduct savings before spendings from your earnings.
This entry is very timely. In relation to this, I wanted to share a recently launched site that might help Filipinos with the ongoing crisis.
As the effects of the global financial crisis are being felt more and more by ordinary consumers, there has been great need for a site that gives people information about contests, promos and freebies. Filipinos can now put a smile on their face amidst all the economic gloom with the launch of Pinoy Contests, a new blog which can be viewed at pinoycontests.blogspot.com.
The site features online competitions that residents in the Philippines can enter for them to win prizes, freebies and giveaways. With the ongoing slowdown, people are motivated to hunt for promos and prizes, and Pinoy Contests serves as a useful resource for them in this regard.
New content is added to the blog each day for visitors to be updated with the latest competitions that they can join. As an occasional bonus, helpful tips will also be given for them to improve their chances of winning.
The launch of the blog coincides with the release of MasterCard's survey results indicating that 70% of consumers in the Asia-Pacific region are more inclined to cut back their spending on discretionary or non-essential items, in light of the worldwide financial crisis. A recent survey by Pulse Asia also determined that 67% of Filipinos are expecting hard times in the coming year.
Thus, visiting sites such as Pinoy Contests where one can win prizes and get freebies seems very attractive and rewarding indeed.
For more information, visit pinoycontests.blogspot.com or email pinoycontests (at) gmail (dot) com.
hello, ma'am salve,
your lessons are practical. they could apply to any year and yet many of us simply forget them or we choose to forget them when the shopping urge attacks mightily.
one wish for 2009. please publish more articles that help pinoy expats learn how to best manage their finances and understand basic things about investing.
rav
Dear Ms Lianne,
I can help you with your financial planning needs. I would need to hear from you your personal needs and expectations, before I can provide you different solutions.
Visit www.financialplan.com.ph or http://arlyn-tan.blogspot.com. You can email me at infor@financialplan.com.ph
Arlyn Tan
Ms Lianne, the email address should be info@financialplan.com.ph instead of info with an r. Sorry for the error.
eating vegetable every lunch and consuming 17 pesos only, it is considered healthy?your sacrificing your hapiness; life is so short!For example one of our officemate:he/she is saving too badly he/she is making "dugas" when their is ambagan and making use of the office supplies for personal use is that considered saving effectively.
@ eduardo
yes, that may be considered a form of saving... but with some cost that may outweigh the benefit...
saving at the expense of other may cost you your friends......
saving by using other's resources for personal gains may cost you your promotion..... remember, what goes around , comes around
Hi! I was surfing and found your blog post nice! I love your blog. Cheers!
Thanks for sharing the good advice, your points are so much relevant even to this day. You're so true, life is not a fairy tale so there'll be tough tasks ahead like trying to save :) I've seen people become misers in order to save that is not life to me. Life to me is living within one's capacity and trying to save out of the too and also multiply but not with greed.
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great, very faun
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