The Importance of Setting up Goals

My financial mentor told me once, “To be able to go to your destination you must have a clear picture of your destination and a plan on how to do it.”

Family finance is different from personal finance because on the first you will deal with several people with different ideas, sometimes with not aligned goals and time lines. A harmonious relationship should have in-sync goals and timelines with complementary ideas. So the first thing to do is to talk to each other and agree on a particular goal and be willing to review them from time to time.

Our family finance has gone an overhaul when we both wanted to purchase a car. He wanted a second hand car while I wanted a brand new car. We were discussing the different scenarios for quite some time until he came up with a decision and convinced me to jump in the boat with him.

We are gearing towards the end of the year so I think it’s about time to rethink our financial goals and plans in the next few years or so.

Here is a clear picture of our budget and savings plan.

*Short Term Goals (those that can be achieved within 3 years)

short term goals	savings per month
emergency fund
pregnancy fund**
car fund

**pregnancy fund will become baby fund when applicable

*Mid Term Goal (those that can be achieved in 5 years)

mid term goals	payment per month
mortgage

*Long Term Goal (those that need more than 10 years)

long term goals	savings per month
investment surplus
educational fund
retirement fund 2.0

We also came up with our monthly spending plan which I think would make us more organized and more conscious of our spending.

household expenses

Association Dues

Electric Bill

Water Bill

Internet and Cable

Food

Leisure/Travel

Gas

Misc

Paul's allowance

Millette's allowance

With these savings and expenses laid out, we also need to utilize all our bank accounts to accommodate each expense so that it’s more organized and become pretty straight forward.

Yey brighter future. ;)

PS: Insurance payments included in allowances. * 

Till next time.

Look back for the lesson, move forward for the future

Past is past and the only things that we can learn from it are the lessons. Anybody can forget the past but never forget the lesson. If you have done something wrong in the past then let it be. It’s time to make a conscious choice of living in the present and hoping for the future.

This is also true when it comes to finances. You may have lost a lot of money during your early years because you felt that having a lot of pretty knick-knacks are the things that will make you the “it” person of your times. You may have been a travel junkie and have visited all the 80 provinces in the Philippines and maybe a few outside the “perlas ng silanganan.” These dramas are okay because the fact that you are reading my blog about finances is a conscious realization that you want to change something in your finance now. J

As I’ve said, it’s time to move on. Make the right decisions today to improve your financial life and work towards financial stability. You cannot go back in time and collect every single centavo that you’ve spent. Acknowledge that you have done wrong and admit it. That will only be the time that you will start to accept the reality and move forward. First focus on how much you are making today and start saving small percentage of it – say 10%. Then increase as necessary. If you have built the habit of saving then create emergency fund and start looking for other (legit) high yielding funds. As long as your savings plan has a goal, you will surely end up with it sooner or later.

Happy saving and investing. J

Do you feel miserable when budgeting?

I have read so many blogs about budgeting having the common description as “necessary evil.”

It may seem to be that way but for people who are used to it see it as a need for the family finance to work smoothly. For me, budgeting should not hinder your personal satisfaction. Rather, see it as your guide in achieving your personal goals. If you really want the new gadget then budget your way to it. It also pays to be smart and reasonable when choosing your goals.

Make budgeting fun!

Budgeting can be FUN!

Why not make a dream board and put the pictures of your goal/s in it then make it a habit to track how much you have saved for it? Fun isn’t ist?:)

Budgeting can be EASY!

Budgeting is easy. My personal strategy is “Save first then never mind.” Let me clear this. What I mean to say is, I save first then make the remaining money enough for me until I get my next pay. For example, I want to buy a bike worth 6000Php. I’d like to buy it 3 months from now. So I will be computing how much I should be saving for the next 3 months to realize my dream.

6000 / 3 = 2000

That means I should budget my money such that 2000Php will be saved for my new bike for the next 3 months. Now here comes the adjustment. What if, I am only able to save 1500Php per month? Well, the sound response to this would be to delay my bike until I have come up with the money needed. Another option would be to assess how I spend my money and work it from there. Maybe I should just bring my own lunch instead of buying from the cafeteria. Or I should just commute for a few weeks to save on gas and put that savings on my bike fund. Or maybe I should not drink soda for the mean time and put the saved money to my goal.

Remember, little things add up. It’s just a matter of perspective.

This was I hope I made Budgeting Enjoyable.

Till next time. J

What is your non-negotiable?

I have been living a very busy life in preparation for a brighter future. Least did I know that I am sacrificing the present in exchange of an exorbitant life in my golden years. My focus has always been “pagdating ng panahon” and I almost forgot to live today – as in the present.

During my early employment life, it has always been easy persuading me to do overtime work and weekend work because I have always been excited to learn the things that would help my career grow. It has always been my driving force to wake up early, go to work and get paid. It has always been the money that drives the people to continue to perform better. But believe me, life is not just how much money you have in the bank and in your investment portfolio. Material things are – just material things that we can easily do without and still live. So for today and moving forward I have to define my non-negotiables and live the life of a true wife.

~Till then.

Arranging our Finances as Husband and Wife

Before we got married we managed our money separately. But few days after being married I scheduled a talk to my husband about our finances.

We are not afraid to talk about our finances ever since. It was not a matter of who earns better or who splurges more. It was more of trusting on each other.

We talked about our expenses and our savings. We have identified things that we constantly buy or pay and have established a reasonable budget for those. We have also set a constant amount for our personal expenses wherein my husband does not have the right to question me on how I spend it and vice versa.

Of course we talked about our savings and where to invest for maximum growth potential. We have allotted specific amount for each of our savings plan and agreed to talk about this for review and possible shift.

We also talked about our future plans and how they will affect our decisions few months/years from now.

I guess I’m lucky I have a very “masinop sa pera” husband. Hello bright future!^_^

Lessons from the Bees at Work

We were fortunate to see some few hundred gigantic sunflowers in the University of the Philippines – Diliman Campus. They were so enormous that the circumference of palm, including my fingers can fit into the core of the flower.

What caught my eyes were the bees buzzing from flower to flower doing their chores to balance nature.

Pollination is 80% done by bees while the other 20% is done by butterflies and other insects.

Looking at the bees, I was able to learn three things from them.

1. Bees get out of their comfort zone.

Their hive can be a few hundred kilometres away from the sun flowers. Despite the distance they go to the campus to get some nectar for their queen. They didn’t mind travelling that far. They didn’t mind the pollution. Once they get there, they work as hard as they could.

2. Bees work until the job is done.

Bees can be called one of the hard-working insects. They gather nectar or pollen depending on the demand. They go from flower to flower until they are full and ready to go home.

3. They don’t mind distractions.

Bees have extreme focus. I, myself, am a distraction when I took pictures of them. They didn’t mind me. They went on. If they got irritated by my perseverance they move on to the next flower away from me. They didn’t lose focus. They knew what they have to do and did exactly as what the job requires.

~Till then

5 Simple Ways to Put Yourself in a Deep Financial Mess

There are practically 5 so sickening simple ways to put oneself into a deep financial mess. Follow these and you’ll find yourself in trouble in no time.

1. Spending more than you earn

People fall into a deep financial trouble when they start to spend more that what is earned. This is what I call the credit card dilemma. Credit card companies want to entice you by saying “You can borrow money from us and pay as little as this amount every month.” People who don’t compute fall on the bait and start spending on credit.

The solution:

Unless you pay your credit card bill in full every month no interest will be charged. Practice living below your means.

2. Not planning ahead

When a person says “God will provide” he is actually strengthening his faith that God is the source of everything. But he should also realize that God will not provide unless he works for it.

A plan is laid before a goal is achieved. No man ever achieved anything without it. The simple task of going to a place has a plan. For example you want to go to Makati City from Quezon City. You envision yourself riding on a jeepney going to the MRT Station then from MRT Station you will ride the train going to Ayala Station. From there you can walk around Makati City. Another option is to ride a bus going to Makati City. Depending on your goal (time of arrival), you will arrive at your destination because you plan how to get there.

Same is true in your finances. No plan simply means that your goal is not a goal. It is just a dream.

The Solution:

If you don’t know how to plan financial goals, sit with your friend who knows. It only takes a little bit of courage to say the words, “Can you help me?” Analyze the goal and plan the path. Don’t worry it will not require algebra or trigonometry. Simple addition, subtraction, multiplication and division will do.

3. Buying wants over needs

Do you really need 20 bath towels stocked in your cabinet?

Do you really need 20 rolls of tissue paper seated in your stock room?

Do you really need 10 rags lying on the floor every single day?

Do you really need 2 cars even if you use only 1 car going to work?

Do you really need a large house even if there’s just the two of you inside?

Do you really need 10 boxes of cereal stocked and rotting in your pantry?

Do you really need to shop for 5 pants and 5 blouses/shirts every month?

Do you really need to buy a pair of shoes every pay day?

Do you really need that expensive coffee fix everyday?

Do you? Really now!

Think!

The Solution:

A want is something you can live without while a need is something you cannot live without. Differentiate the two and you’ll go far.

4. Not having proper insurance/Canceling an insurance policy without replacement

Seldom do people think about the importance of having an insurance. To know more about the benefits of having an insurance please click here.

The Solution:

Get yourself insured especially when you are the provider of the family. The rule of thumb is multiplying your annual income by 10 and you’ll get how much insurance coverage you need. I always recommend term insurance.

If you have an existing policy, analyze it first before deciding to get rid of it. Moreover, talk to your agent and ask further questions. I’m sure he will be willing to help you. If you are not satisfied, research and do the math.

5. Not having time for financial education

Financial education is more important than the basketball game, more important than the drama series, more important than idling on Facebook or Twitter. But people are so fond of doing the opposite because they are not aware with what they are losing every time they postpone learning about their finances.

The solution:

Make it a habit to listen to business news instead of celebrity news. Celebrities will just make you feel inferior because they display high social status which makes you want to spend more to “be like them.” Read at least one financial literacy book every month. Apply the concepts learned. Attend financial workshops. There are so many free financial seminars and workshops in the Philippines. Not attending one can actually loose you millions after a few years. Talk to people who are financially literate. If you want to be like them mingle with them. Ask for guidance. Believe it when the Bible says, “As iron sharpens iron, so one man sharpens another.” (Proverbs 27:17)

~Till then.

Why do People Complicate Things?

Make an average seven year old child solve a math problem and he can do it in less than 3 minutes. Make a man in his 30’s solve a debt problem and he will complicate things.

Is it not that debt problems are math problems? Ask a child how much does it take to pay an ice cream and he’ll tell you its five pesos. Ask a man how much does it take him to pay a pair of shoes and he’ll grab his wallet, take out the plastic card and says “This much.” Ask a child if in case he doesn’t have money, will he be able to buy an ice cream and I’m sure he will say “No.” But ask a grown up and he’ll say “Yes.”

Lesson:

Do not spend more than what you have. Apply some rules I’ve been applying for the past years.

1. Never spend for things if you don’t have the means.

2. Plan for every purchase.

3. Wait for 30 days before finally deciding for a big item.

4. Don’t mind the status quo.

5. Learn how to be happy with simple things. Happiness comes from personal relationships, not from material things.

The Script of Life

Got this from International Marketing Group Materials

If we track the life of average educated people, the financial script often goes like this:

The child goes to school, graduates, finds a job and soon has some money to spend. The young adult now can afford to rent an apartment, buy a TV set, new clothes, some furniture and of course a car. And now the bills begin to come.

One day, the adult meets someone special, sparks fly, they fall in love and get married. For a while life is blissful because two can live cheaply as one. They now have two incomes, only one rent to pay, and they can afford to set a few peso aside to buy the dream of all young couples, their own home.

They find their dream home, pull the money from savings and use it for a down payment on the house, and they have a housing loan. Because they have a new house, they need new furnishings. So they find a furniture store that advertises those magic words “No money down, easy installment payments.”

Life is wonderful and they throw a party and have all their friends over to see their new house, new car, new furniture and new appliances. They are now deeply in debt for the rest of their lives. Then the first child arrives.

The average, well educated, hard working couple after dropping the child off at nursery school, must now put their nose to the grindstone and go to work. They become trapped by the need for job security simply because, on average, they are less than three months away from financial bankruptcy.

From these people you often hear, “I can’t afford to quit. I have bills to pay.” Or a modification of a song from Snow White and the Seven Dwarfs, “I owe, I owe, so off to work I go.”

~Till then

Personal Order (Being good stewards of God’s Gifts)

A lecture/kwentuhan with Lingkodmates.

Everybody has a role to play.

• You are a sister or a brother in a community.
• You are a daughter or a son and/or a sibling of your family.
• You are a worker in an organization.
• And of course you are a child of God.

What do these four roles have in common? Have you taught about it?Okay, enough of the guessing game. The answer is RELATIONSHIP.

We build relationship in a community, in the family, in the organization/workplace and of course with God. More than anything else, we should build these relationships for the betterment of our totality as a person and as a child of God.

What does my introduction have to do with personal order?

Before that we should define what an ORDER is.

Order is a condition wherein there is a place for everything and everything is in its proper place. It is a condition, which there is a methodical, proper and harmonious arrangement of disposition of a thing.

Imagine your cabinet/closet. Is it in order or not? Are your clothes arranged properly or not? How do you arrange it? Is it arranged by color or by size? Are the shirts neatly folded-up or not? Are the socks in proper place? Are those belts hanging loosely from the pants you wore the day before? Are the shoes neatly placed on the shoe rack? Can you find something quickly? If somebody opens your cabinet, will he/she be able to find something quickly?

My friend, that is one way of defining personal order.

But why do we need order?

We need order so that we can perform to the fullest and we can do what God wanted us to do in life. Order is reflective of God’s character. God is a God of Order. God created us in an orderly manner. He created our eyes on top of the head so that our vision is not hindered. He created our nose on top of our mouth so we can smell the food before we eat it. He created our ears in a manner where we can hear on both sides, left and right.

If you want something to happen but did not happen as you wished it to be is because you are pertaining to YOUR time and not in God’s time. There is always time for everything…(Ecclesiastes 3:1-8)

We need order because we want to grow in three (3) Christian qualities.

• Generosity
• Faithfulness
• Peace

Generosity means we are able to give to the needy.

Faithfulness means we are trustworthy servants of God.

Peace means we are able to live not of disorder.

What are the important areas to put order in?

• Time and relationship
• Treasure, Money and Things
• Talents

Time and Relationship

Time is gold. No human being can ever bring back lost time. So be careful on how you spend it. Relationship is associated with time because relationship grows with time. You need to spend sometime with those persons you want to have relationship with. You also need to spend time with God so that you can reflect on what your true purpose is.

Treasure, Money and Things

Everything in this world is from God. He owns it. We are just borrowing it. So be careful on how you handle your finances because when judgement day comes you are accountable on how you spend the gifts he gave you.

Talents

Show your talents because they are gifts from God. Nurture and hone them for the glory of the Creator. He gave you talents to share it with other people so don’t hide them.

Here are the principles I learned from my friend’s talk:

• We are merely stewards of our resources. Be very careful on how you handle resources.
• We must seek God’s wisdom and timing in all our work. All in God’s time
• We must trust God and see Him work. Be a faithful servant of God.
• Seek advise from elders. A very good sign of humility is seeking for advice if you really can’t handle the situation any longer.
• Learn from mistakes, be patient and willing to do it over again. Your emotional intelligence is put to test in this principle.
• Be simple in priorities, take away the clutter. Set your priorities, focus on them and drop those nonsense.
• Be hardworking but know your limits. Give your best in everything you do.

Here are some practical tips you can apply.

On Time and Relationship

• Buy a planner and actually USE IT!
• Schedule the important things before they become urgent.
• Live one square at a time. Don’t overstress yourself on your upcoming schedules. Focus on “today” but plan for tomorrow.

On Treasure, Money and Things

• Use the 10-10-10 Principle. (10% tithes, 10% savings and 10% emergency fund)
• Always remember this, “The virtue of temperance disposes us to avoid every kind of excess.”
• If you have two (2) coats, one of them belongs to the poor.

On Talents

• Discover your talents.
• Do not be afraid of failure.
• Ask God to let you see where to serve Him.

As a conclusion, everything that we have comes from God. We are responsible to whatever He gives us properly and accordingly to his will. We must be patient; wait for the Lord. We must NOT go ahead of Him. He is faithful and He will fulfill our heart’s desire.

~till then

On Decluttering

I have noticed myself, for the past two weeks, that I have been accumulating papers on my desk. Loads of paper works pile up every single day. So I want to go back to the basics of decluttering which include 6 simple steps most commonly known as 6S.

1. Sort

There are only two things to consider when sorting. The “I need it box” and the “I don’t need it box.” Everything that needs to go should go. Everything that needs to stay should be checked twice because sometimes we put things there that are not supposed to be there. Always remember that simplicity is the key.

2. Stabilize

Invest on a paper tray. The paper tray should have two levels labeled IN and OUT. The IN should be at the bottom while the OUT should be on top to easily get out-going paper works. For me, OUT tray consists of receipts and presentations that need to be distributed.

3. Shine

Clean up the workplace. Make sure there are no smudges on your desk. It is easier and more pleasant to work when the work area is clean. The mind is at peace and your body is relaxed. Make it a habit to wipe your desk every Friday so that when you go to work the following week you will see a neat place ready to take on the week’s load.

4. Standardize

If you can go color coordinated then it is ok - as long as your office allows it. What am I telling? If you want that your things will have the shade of blue, then do so. That is one way of standardizing things. Another way is to have envelopes in one size and in one color. Label them appropriately and arrange them in alphabetical order. That way you can increase the chance of getting things quick and easy.

5. Sustain

Decluttering is not just for a day. It is a lifestyle. You can also do once a month general cleaning to sustain a clutter free environment.

6. Safety

Make sure that your files are in order and are not blocking any passage. As the saying goes, “Safety first”.

I hope this simple blog inspires you and me on becoming clutter free and organized.

~till then.

Lust of Money is the Root of all Evil

Will you oppose me if I say, “Lust of money is the root of all evil.”?

Lust is defined as an intense longing or craving of something. If you have an intense longing or craving for money to the extent that you will do anything to have more of it then I think you have a problem.

Money alone is not evil. Money is a tool we use everyday. We use it to buy our needs. We use it to trade. We use it to help other people.

Money can be good or bad depending on how you use it.

I oppose the people who say love of money is the root of all evil. Love is a positive word. You can love money because it is entrusted to you by God. But never lust for it. Remember, money is not yours to keep. Money is entrusted to you to help the needy, to keep your faith to God and to make your life more pleasant. What was given to you will be taken back at the end of times so use it wisely.

~till then