Build up Your Back-up Fund

Pinoy sa buhay ngayon, it's important that you build up your savings fund. Our question (as always) is, anong savings while wala namang natitira sa sweldo mo? 

If you want to become financially free, you have to make a decision. You have to be determined that you really want to become free. Regardless kung anong reading materials ang aralin mo and seminars that you already attended, without the DECISION and DETERMINATION hindi mo rin mararating ang maging financially free. 

Usually a back-up fund is equivalent to 6 - 8 months of your salary. That is the same amount of time which  your family will adjust if something happens to you. It is the same fund they will use if you are not able to get back to work within that time period and to pay off your financial obligations because of illness, disability or maybe accident. Also, during that period they can determine if you are still capable of working on the 9th month. 

So if you can't get back to work anymore, they have 6-8 months to adjust and plan ahead. 

I feel you, it is not that easy. If you cannot still save at least 25% or your income, why not save at least 10% or kung padin talaga kaya then save 5% or maybe just keep on saving php100 or 500 every payday. 

Once nasanay ka na in saving first before spending, it will become a habit.

But first of all, make a DECISION, gusto mo ba talagang ma achieve ang financial freedom? so be DETERMINED to become financially independent!

Visit www.cha-ching.com and learn the four money smarts with the gang!

Pinoy, How is your spending this holiday season?

Few days to go and 2014 will say hello! kamusta naman ang spending natin over the holidays??? I know that a lot of pinoys out there have spent so much this holiday season, some may have spent onto something they have been waiting for, some may have spent their bonuses and salary for the gifts and all and maybe some really planned on spending their bonuses this season.. 

Para sa mga kababayan natin who have gotten beyond their budget this holiday, I hope the tips below will help. 

1. Credit Card

It's always best to pay your bills in full. Just in case, you can't really pay in full, pay at least half or the minimum due but do not purchase anything just yet if di pa tapos ang utang mo sa credit card mo. 

2. Income VS Expense

Again, it's always important that after all the eating and dining this holiday season, get back on track, make sure that you always prepare your income vs expense sheet para alam mo if there are items you need to adjust. 

3. Budget plan

For those who are into gadgets, maybe yung iba sa mga kababayan natin bought gadgets or appliance on an installment basis, make sure that you update your budget plan every month so you know which items (again) to adjust. (in fact, you should have been doing this all along kasi from your income vs expense sheet and budget plan, malalaman mo din if you can really afford to buy a gadget, an appliance or anything na makaka apekto sa cash flow mo)

4. Do not repeat your stupid ways this coming 2014

Since you have experienced na magka utang or mabaon sa utang noong 2013, Huwag mo nang ulitin ngayong 2014. Otherwise, di ka na makaka angat. You will become a forever slave to your creditor. Sabi nga ng ibang financial experts, you work just because you got to pay debts. 

5. Discipline

Finally, all your ways such as trying to fix  your cash flow, managing your income and expenses will become useless unless you have the discipline. Regardless of the amount of income we have, if we don't have the discipline to manage our own finances wala tayong mararating.  

When you are buying stuff, pwede mo naman i-plano diba? 

Sabi nga ni Mr. Vic Garcia who is the author of Kuntento Ka na ba sa Kaperahan Mo, and many other books na you ask yourself these questions when buying something: 

Buying Self-Test

1. Gusto ko ba talaga ito? 
2. Kailangan ko ba ito? 
3. Kaya ko ba itong bilhin? - is this within my budget? 
4. Gusto ba ito ni Lord para sa akin? 

and if any of these 4 questions will give you a "No" huwag mo nang bilin ang bagay na gusto mo. :) 

Discipline is key.

So, Pinoy, Kamusta nga ba ang spending mo this season? 

I hope that these few tips can help in managing your finances and getting back on track this 2014. 

Happy new year Pinoy! 

Save Save din Pag may Time! ;p

Let me use a very common expression today of the youngsters, "save save din pag may time". In fact, it's true, we got to save as much as we can and not only when we have the time. People think saving should be the last on their list once they get their sweldo. Some folks use this format:

Income - Expenses = Savings

Kaya nga lalong di nakaka ipon because it's not your priority. It should be like this:

Income - Savings = Expenses

Don't worry about how much you can save, in reality, you should really be saving at least 10-20% of your income, but if you can't, then start small, sabi nga ni Randell Tiongson, RFP - baby steps. You can start saving 300 or 500 pesos every payday or if you can't keep 300 or 500, then why not 100 pesos.

There are a lot of reasons to save for; your medical expenses in the future, educational fund for your children, major investments and of course retirement. If you will not focus on expanding your net worth, kawawa ka naman pinoy by the time na 60 or 70 ka na (well if you live that long, but according to studies, humahaba ang life span ng pinoy) e sino mag aalaga sayo? Would you like to rob your children of their freedom ? would you like to be a burden to your children? Hindi ba masarap sa pakiramdam na pinag aagawan ka ng mga anak at kamag anak mo instead of being put away because you are such a burden?

Ito pa ang matindi, binilin ni God maigi sa atin ito that A good man leave inheritance to his children's children but the sinner's wealth is laid up for the righteous - Proverbs 13:22. We should be vigilant in laying up the foundation of becoming financially free for our family and become your childrens' role model in handling finances.


P.S.

let me share with you how worrying about finances can affect your IQ, I got this from Pru Life UK Official Facebook Page

Kaya pinoy, save save din pag may time! :)

Jendee S. Sapo
Financial Consultant
Pru Life UK
jendee.sapo@prulifeuk.ph

Variable Unit Linked - Why do You need one?

Few years back, people can only hear about savings or insurance or investments. Until such time, that all these services meets at one certain point and gave birth to a program called Variable Unit Linked or Investment Linked Insurance.

It's a good thing that in 1996, Pru Life UK (Pru Life UK Official Web Page) pioneered the Variable Unit Linked program where both insurance, savings and investments can be offered to us - Pinoy.

VUL is designed for medium to long term goals. According to studies only a small percentage in the Philippines is insured so what will happen to the large chunk of the population when they get sick or die prematurely? Don't they love their families too?

On Protection

Let me refer you to the illustration below (Taken from  Pru Life UK Official Facebook Page)

What will happen if these will happen to any of us? We don't know what tomorrow brings to us and our family and it is always best to become even more vigilant on preparing for the future most especially if you have dependents. These are the things a Filipino doesn't know anything about (or just not aware of). Is it because of our culture? that probably we expect to be dependent on our relatives when it comes to money or sickness? or is it because we can just say "bahala na" ?

Have we not thought about those who depend on us? Do we  like to leave them debts (utang) when we die? or when we are hit by a critical illness? Imagine how every 1 in 6 Pinoy is hit by stroke and there is only an interval of 2 seconds? who are the people you are thinking of now? the faces of your family members that flashes before you?

On Investment and Savings

Einstein said that the eighth wonder of the world is compound interest.

That is true because given the "time", there is so much we can do with our money. Given that age is the same (24 years old) , and you invested your money with different fund instruments - bank, mutual funds, stock market, variable unit linked product and real estate, there are opportunities to double your money several times in your lifetime!

Another factor that will matter is the time you decided to save. See illustration below:

With Mr. Early Saver, though he saved only in 5 years with a total of P 600,000, his total returns by the end of 20 years is around P 4 Million! While Mr. Late Saver he has to save for 15 years just to get the same amount. But here is the thing, at this point in time, regardless whether you are the early or late saver, it's important to save and be determined to change your financial life!

Now why VUL and why do we need one? In a variable unit linked product you will have the following:

1. Protection plans that will cover your emergency needs such as critical illnesses, disability, hospitalization
    and accident.

2. Savings - You will also have the opportunity to discipline yourself to save for retirement and other major
    purchases

3. Investment - a VUL product can give you the opportunity to invest in the stock market and as well as in bonds or combination of the two.

Simply put:

*This is an example of a VUL product for a 30 yr old male, who is saving P 5,000 every month. 

I hope that this article, again, enlightened you on what is available in the market. Should you need assistance on VUL and if you think this is something that matches your need in terms of investment and protection, don't hesitate to email me or leave a comment below with your email address.

Happy investing!

Jendee S. Sapo, RFP
Chartered Trust and Estate Planner Graduate (CTEP)
jendeesapo@gmail.com

Tips on Saving and Budgeting

So this is the first of the articles I am going to write for Pera Pera Lang Pinoy (PPLP). 

 Today, I would like to share with you ideas on saving and budgeting. In fact, there are a lot of tips available in the internet, but let's just focus on two things: 

1. Reduce your expenses 
2. Increase your income 

 Those two are the facets of successful savings also. If you think kulang ang kinikita mo, might as well, write down all the expenses you make every day and prioritize. Make a budget, kung ano lang muna ang importante iyon muna ang bilin. E pano naman kung lahat importante? That's the time you increase your income. Ibig sabihin lang is that kulang talaga ang monthly income mo. 

 In terms of increasing your income and reducing your expenses, there are a lot of things you can do: 

1. Earn from you skill/talent (Baking, Graphic arts or multimedia, tutoring, singing,online job, MLM etc) 
2. Sell stuff you don't need (Pwede kang mag garage sale) 
3. Bring your baon (either going to school or work)
 4. Bring your own coffee (kung kaya naman di bumili ng mamahalin na kape, bring your own,healthy na brewed pa!) 
5. Discipline - Wag nang bilin ang mga bagay na di naman talaga kailangan o pagkagastusan, o kaya naman ay makakapag hintay, ito ang tinatawag na delayed gratification :) 

 Below are some tips from Pru Life UK on how to loose some pounds!

Hope that this article was able to give you ideas on financial planning. :) happy sunday!