Top 10 Most Important Lessons to Learn in Personal Finance- #7

I try to as always incorporate new things that can spice up this financial blog such as including webinars of past posts through my Youtube channel. If you want to subscribe click here) and creating posts based on Filipino financial terms such as paluwagan and 5/6.

In addition to the above I decided to create a series posts and as a premier I will be posting the Top 10 Most Important Lessons to Learn in Personal Finance.

#7 Every Piso Counts

I own this tall alkansya in our house. I tried so many times to fill it with coins but I fail. The farthest I did was almost half-way. With that I tried the plastic piggy bank which is the most common type.

You know what I love most about having alkansya? Its the sound of the coins when you shake it. Its just fulfilling to know that slowly your savings are getting bigger and bigger. (and heavier and heavier too!)

It also made me realize that every piso counts! I saved almost 2,768 pesos just by the coins that I have everyday from loose change! That can buy you new clothes, new makeup, a grocery for a week or initial investment!!!

When you have this sense of value to every piso that you earn you become better in spending it. You are aware of how many piso will cost you in buying that branded bag or that studded heels. You know that your piso today can be thousands later so why spend it in not that needed items.

Owning an alkansya is a very good habit for it purposely give you motivations to save. I suggest saving only coins such as loose change through it. Bigger money should be saved in bank so that it earns interest. If you have enough savings already then its time for you to try investing to stock, mutual funds or even your own business.

Sabi nga di ba, lahat naman nagsimula sa piso! Stop the Piso lang Naman mentality and start saying Piso Din Yan! This way you won't let go easily in your impulse buying!

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Be better in your finances. Save Now, Invest Now and walk your way to success. Sign up in my Email List and receive templates to get you started in your Financial Wealth. Follow me on Facebook and Twitter for better updates. Godbless

Understanding Managed Funds as an Investment Vehicle in the Philippines

An office mate of mine once asked where to primarily invest since there are even more types of Managed Funds available. It took me a long time to answer for I wanted to gather as much information as possible regarding the topic.

You see the worst problem other than committing to a budget and saving is choosing where to invest your money. There are just a lot of choices to choose from. As a duty of a smart investor, one should not just attain a portfolio income in one investment vehicle but try as much as possible to keep the flow as diverse as possible.

Currently I introduced the following Investment Vehicles in my blog just like FAMI- Mutual Fund and UITF. It is also good to take note how easier and more affordable investing is nowadays. A lot of investment vehicles available can be tried for as low as 5000pesos opening (there are even lower) with monthly investment not less than 1000pesos. This is because the government supports the desire for every Juan dela Cruz to invest. So kick-start your way to investment NOW!

What are Managed Funds?!

Managed Funds is a type of investment wherein a professional financial institution will make the investment decisions for you.

How Managed Funds Work?!

Managed Funds work for the convenience of the investor. Your investments are pooled together with the other investors. Then the trusted financial institution will buy and sell the shares or other assets on your behalf. They also set where your money will be going and how the percentage of shares you own will be.

Examples of Managed Funds

- Mutual Fund

Click here: 7 Advantages of Mutual Fund

-UITF

Click here:UITF vs. Mutual Fund (Beginner's ALERT!)

-ETF (Just recently launched in the Philippines)

Advantages and Disadvantages of Managed Funds

As said for a thousand times investing in reality is a risk. Every investment whether small and big may come with a risk factor.

Below are the happy thoughts in managed funds investments (Mutual Fund, UITF and/or ETF)

1. Low Initial Investment

2. Diversification

3. Convenience and Cost Efficiency

4. Principle of Compounding

5. No more Tax

6. Regulated by SEC

7. Liquid Statement

Below are the sad facts:

1. You depend most on other people rather than learning the process by your own

2. Conversion to cash such as redeeming may take a while if you don't want to pay for charge.

3. May be charged higher compared to direct stock investment since you are working with a private financial institution.

Types of Managed Funds

Managed Funds are divided to four main types namely Money Market Funds, Balanced funds, Bond Funds and Equity Funds.

Money Market Funds are short-term fixed income securities investment such as time deposits and t-bills.

Balanced Funds is an investment with combination of equities and bonds.

Bond Funds are managed funds set to invest in long term bonds

Equity Funds are the common managed funds that invests in stocks.

Let's differentiate the four

Out of the four, Equity Funds are the most risky for stocks are moving almost every second.

Bond Funds has moderate risk and considered as a safer investment from equity funds.

Money Market Funds are the least risky but the growth of your investment is really low.

Balanced Funds have low risk factor too since its a combination of equities and bonds but you need to be prepared in case one will depreciate in value.

Preparation Tip: Have an emergency fund of 3-6 months of your expenses before investing.  Aside from an emergency fund research will be one of the best readiness trick before investing.

Recovery Fact: It may take 2-3 years before one can fully recover from an investment failure

Conclusion: Highly recommended for young professionals who have the right money and the right attitude in financial investment. For first-timers try an equity fund if you have the money and the luxury to invest. My FAMI-SALEF is a type of Equity Fund and so far so good as of my recent FAMI update.

So Ms. Izza where should I invest?

The choice is yours primarily when it comes to where you'll spend. You may not even like the idea of managed funds and opt for a direct stock investment, right? But for added information please see the following:

1. Know your investment appetite. You may talk to a financial advisor or go to a bank near you instead.

2. Have some solid financial goals. Objectives and visions about your finances will help a lot to know which type is the right for you.

3. Money Market Funds may not be a worth it investment to choose for the very low return.

4. Equities are a go to specially if you can truly invest for it give higher return of investments though the risk is present.

5. There's no harm in trying. A managed fund is a good start if you want to be financially able in the future. As young as you are now, INVEST.

Hope you find this post helpful :)

INFOGRAPHIC: How To Stop Living from Sweldo to Sweldo

Before the work week ends I'd like to give you, my readers, a little treat. Here's the Infographic version of one of my highest viewed blog post entitled How To Stop Living from Sweldo to Sweldo.

You may read the full story here: How To Stop Living from Sweldo to Sweldo which also includes further personal experience on living from sweldo to swledo before and essential terms and examples that you might need to understand.

http://savingspinay.blogspot.com/2014/07/how-to-save-within-your-salary.html

Get this infographic as part of your wall paper or maybe you can print this so that you'll be as always reminded for these financial tips.

Kindly Like and Share this through social media specially on Facebook, Twitter and Pinterest.  Easily share this via social media buttons below!!!

Top 10 Most Important Lessons to Learn in Personal Finance- #8

I try to as always incorporate new things that can spice up this financial blog such as including webinars of past posts through my Youtube channel(If you want to subscribe click here) and creating posts based on Filipino financial terms such as paluwagan and 5/6.

In addition to the above I decided to create a series posts and as a premier I will be posting the Top 10 Most Important Lessons to Learn in Personal Finance.
 

#8 Expand Your Knowledge

The reason why most oldies including our parents will say that we are a lucky generation is the fact that life is easier because of the technology compared before.

Without this so called advancement in the technology we would still be in the black and white season. No social media, no Google and no Wikipedia. Information will be so hard to find, to generate and to disseminate.

Living in the generation where almost everything can be done by the clicks of our fingers opens wide variety of knowledge. This then is the reason why continually expanding your financial knowledge is important.

Where can you find financial knowledge for LESS???

Books. Visit the leading bookstore near you and go to business/investment section and find new and fresh ideas on how to manage your money. (Just be sure you only read books that are already open and ok public reading policy)

Read: Kuntento ka  na sa Kaperahan mo Book Review

Blogs. Financial Bloggers have truly changed the financial literacy nowadays. If its not for other financial blogs I will never have this much information about money matters. Best thing is that those knowledge comes from a personal side so its easier to understand for you can relate. 

Search Engines. Go to Google, Yahoo or Bing and find a lot of meaningful resources about finance.You may print, write on a piece of paper or memorize the results of your research. 

Around you. Talk to your Mom (or Dad) or observe how she (he) manages your household needs and for sure you’ll learn a lot of tips and tricks. You don’t even have to pay a single centavo plus it will be an added bonding between the family. The thing is experience is the best teacher so personal thoughts and habits will always be a great source of financial knowledge expansion. 

The more you learn the better you become but of course it takes action and commitment to truly kick off a habit. It is a tough journey attempting to be financially able but its all worth it.  

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2. How I applied for SSS Number in Robinson's Pinoy Lingkod Center
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4. How To Earn Extra Income in the Philippines
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7. How to Apply for Unionbank EON Bank Account
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10. How to be Financially Blessed?

Be better in your finances. Save Now, Invest Now and walk your way to success. Sign up in my Email List and receive templates to get you started in your Financial Wealth. Follow me on Facebook and Twitter for better updates. Godbless