Friday, August 28, 2009

Our Crazy Government

I don't normally write about politics because I try to avoid it as much as possible but I found this article in August 26 of the Inquirer so crazy that I just had to react to it!

The article stated that the government was having to export excess corn production at a loss. The government would buy corn at P10 a kilo from farmers and sell it at P8-9 a kilo to countries like Vietnam. They were doing this to stabilize the price of corn which had gone down so much because of the excess.

Now here I am thinking that's pretty silly because we are losing 1 to 2 pesos per kilo! The government was selling 150,000 metric tons to Vietnam so basically that's a loss of 150 million to 300 million pesos!!! But then I thought, that's ok because if we don't sell it, the corn will just rot in the warehouse. And then I thought that's pretty good because our farmers are producing a lot of corn which means eventually we will be able to export our corn at profits with better planning.

But guess what... The article then states that there was a surplus in corn because we IMPORTED 1.1 million metric tons of corn substitute known as feed wheat!!! This is crazy!!! So our country will lose PHP150m to PHP300m because some guys allowed this feed wheat to be imported.

Any businessman will tell you... Don't freaking import the corn substitute when you have a corn production excess.

Saturday, August 15, 2009

The Holy Grail – Passive Income!!!

The entire theme of what I write about on a regular basis is How to Make Everyday a Sunday. I believe our financial goal in life is to make everyday of our lives a Sunday. Why Sunday? Because Sunday is the day when we can do anything we want - wake up late, spend the day with family and friends, eat out, go shopping or do the things we love.

So how can we do this? It’s very simple. We make enough money WITHOUT WORKING so that our monthly income exceeds our monthly expenses. Say what? How do you make money without working? The answer is Passive Income. Passive income is income that is generated from investments. It makes money for you if you are sleeping, on a holiday, or spending time with your family. See that's the beauty about money. When you don't spend money all it wants to do is make you more money!!! It is your best worker. It works 24 hours a day 7 days a week. It never gets tired and never complains.

How do you get this passive income? There are basically 3 ways - interest, rent and dividends. To start with it’s as simple as putting your money in a time deposit. Time deposits generate interest which is passive income. It’s not much but it’s a START! And it’s better than nothing. Then when you have more you move up to longer term bonds which give more interest. You can also start looking at properties which generate rent. Later you can invest in stocks or businesses which produce dividends.

Most people focus on getting a higher salary. They think that once they get a higher salary it will end all of their financial problems. WRONG! You can't work forever. Remember that. At some point in time you have to stop working. Now I want you to imagine life where you don't have a salary. For most people that's going to be a big problem. You have to build up your passive income now while you still get a salary.

Of course you can't accumulate investments if you don't save. The bottom line is still saving enough so you can generate enough money to invest. But my point here is start focusing on the passive income because its in the passive income where you will achieve financial freedom.

For more information on how I can help you email me on
hoover@barongroup.com.ph.