A problem 20 years into the future

This one's a wicked real life problem I can help you solve, because finance is NOT a fluke.

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Suppose you are exactly 30 years old. You believe that you will be able to save for the next 20 years, until you are 50.
For 10 years following that till age 60, you will have a spike in your expenses due to your parents' health, children's wedding, and other needs, and you won't be able to save.

If you want to guarantee yourself 40,000 per month, starting one month after your 60th birthday, how much should you save every month, for the next 20 years?
Assume that your investments are expected to yield 8% annually and you are likely to live till age 80.
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Network Marketing is for the gullible

Wala namang masama sa network marketing. I seriously think it's a legit business...if and only if members move products to earn and not recruit people to layer money pambayad sa existing members or "top" niche. Avon, Ghealth, Human Heart Nature are the good ones, IMHO.
And pwede ba, pagka magiinvite naman sila, dapat outright sabihin kung para saan at ano, hindi yung "investor" raw tapos aalukin bigla ako magcash out ng bongga for membership.

It's my 3rd time to fall 'victim'; investor daw (because I specialize in stocks investment), yun naman pala, aalukin ako ng ROY..ump at US...ugh. People should outrightly tell their motive. If they're using foot in the door techniques, oh well, turn off yon big time!

FA stands for Flight Attendant and Financial Adviser

A flight attendant will instruct you to put your oxygen mask on first, before helping others. There's also financial wisdom behind this.

Giving 100% of your salary to your dependents won't do you good. If something happens to you, and you lack savings and protection, ask yourself: What will happen to them?

Save at least 5% of your monthly salary and invest it in high growth, high protection investments.

Part-time Job in the Philippines

What if you can get a part-time job with a professional license (since you're image conscious)? All the better, if this endeavor is for free, affords you free classes, and is linked with government and private banking institutions?

Become a financial adviser, a financial analyst, or even a stock broker!
A 7-day basic training is all you need to get started.

Just Do it, Investment or Otherwise

Don't doubt your self taking off. Year after year you will make it better. With the awesome people around, failure is not imminent.

So why think "I can't start an investment because I might get unemployed."
"I can't risk it because I don't know what I'll be a year from now."
"I can't do it because things might change for the worse and I don't know when."

For Pete's sake don't be a loser and just do it!

iPad Plan or iPad Cash Purchase?

Thinking of buying an iPad Air 32gb, wifi + 4G?
Which is cheaper: Postpaid or cash?

Here's a simple computation for you:

31300 (cash) vs 45800 (1700/month/24mos + 5k upfront cash)
Plan is 14500 more expensive.
You pay P604 extra per month for 24 months.
But plan comes with 65 hours of LTE so you might not have a need to pay for a separate wifi bill. In short, you save by purchasing it via plan.

And if you put your unspent cash in equity stocks (since you opted for a monthly payment) then in two years you would already have reached a break-even.

~your financial adviser
PS
I took my own advice.

A Better Alternative to SSS and GSIS

Not a few Filipino citizens will be looking forward to their monthly pension from SSS and GSIS upon retirement. And it is no secret that the allowance roughly translates to P3,000/month, which 10 years from now will just be equivalent to P1,809.

Do you think P1,809/month will suffice? How about your maintenance medicine? Your electric bill and other fixed expenses? What if you would need a lump sum amount for a surgery?

Clearly, a small trickle of allowance from SSS or GSIS will not be sufficient.

What if there's a solution that can afford you a P15,000 monthly pension instead? A solution that allows you to withdraw P1.6M tax-free should you need a lumpsum?

I'm talking about investments. Of course it's better if you have an insurance policy. But let's go back to how this will work.

1) You are 35 years old today.
2) You want P1.6M at age 55 OR P15,000 monthly earnings from 55th year onwards
3) You want to be able to partially withdraw cash anytime
4) You don't like the idea of maturity dates

What do you have to do?

1. Save P1600 for 20 years. Stick to it.
2. Save it in high earnings stocks. 


Other Options:

If you save P1600 in the piggy bank, you will get P384,000 in 20 years.
If you save it in time deposit, you will get P501,000 in 20 years.
If you save in stocks and bonds, you will get P1.6 million.

Which would you choose?
You've got to plan for your future self. And you can start now.

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For inquiries, send an email to Horeb Eliot at horebelliot at yahoo .com.
Horeb Eliot is an assistant professor at UP and is a licensed financial planner.