The Right Team

Tomorrow is the start of the 'love' month, so I was thinking what I would write that would relate to saving and investing? Here it is... you CAN'T be wealthy if you don't have a good team, a family who supports and helps you achieve your financial goals. There is no way you can save if your husband or wife spends like crazy. There is no way you can save if your kids always ask you to buy stuff for them. Your family has to cooperate.

Do you know the number one reason for failed marriages? For fights between husband and wife? Yip you guessed it. MONEY! Normally it's a husband or wife who spends too much or doesn't earn any money. The problem is always the same.

I'm not a marriage counsellor but I know that a financially successful marriage needs both husband and wife to have:

• the same financial goals.
• the same attitude toward hard work and earning money
• the same attitude toward saving, spending and investing
• total transparency and trust with money related matters

If your marriage does not have the above then you better talk about it right away.

For people who are looking to get married. Take some time to do this BEFORE you get married! Sometimes people who are in love tend to forget to talk about the financial side. Remember a marriage here in the Philippines is lifetime. So choose wisely!

I have personally advised friends not to go through with the wedding or delay it if their attitudes and goals about money are not aligned. And I have personally witnessed failed marriages for those that did not heed this advice.

Of course a happy marriage is not all about money, without love there can never be a lasting marriage!

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

Sink or Swim

Just got off the phone with a friend. She was crying because she just found out that her younger sister who was attending college, the first in their family to do so, is pregnant! She was crying because she had slaved away all those years borrowing money and working two or three jobs just to make ends meet and now her hope is lost.

You don't know how many stories like this I have heard! I told my friend that she should have invested the money on herself. She was the hungry one. It was her and not her sister who was the hope of the family.

The general rule is you can help if you have money to spare but don't borrow money to help someone else.

I know a lot of people are going to get mad at me for what I just said. But please give me a chance. I'm not against people helping their families and friends, but if you are going to go into debt just to help someone out, it better be a life and death scenario.

Unfortunately in this day and age, 'utang' is so easy to do. But everytime you borrow money I want you to remember that you are borrowing your future. You are spending money you haven't even earned yet! So before you borrow money to help your family and friends here are some things you should consider:

• Ask yourself this question. If the roles were reversed and you were the one who needed money do you think this person would do the same thing for you?
• Tell the borrower to exhaust all other means before getting money from you. Give them ideas like finding odd jobs or selling some assets.
• Borrow ONLY for health and education emergencies and only for your immediate family.
• Never give money to people who can earn money by themselves but rely on you for their money.

I'll leave you with something to think about. Two people are stuck in sea. There is no help for hours. One person is a stronger swimmer than the other, but the stronger swimmer can only keep one person afloat. If the strong swimmer tries to help the weaker swimmer they will both drown. But alone he/she can survive. What should the strong swimmer do?

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

Back to Basics - Being 'Financially Organic'

If you have been reading the newspaper, Germany’s 5th richest man, Adolf Merckle and French money manager Thierry Magon de la Villehuchet recently committed suicide due to the global financial crisis. Their sudden suicide has really made me think. These people did not kill themselves because they were not going to have enough money to feed their families but because the loss has hit their pride, honour and identities. I can definitely understand their pain because I have had to learn the hard way myself. But isn't this a case where money (and all its material possessions and status symbols) has begun to control our lives, and to dictate how we feel about ourselves.

Like the health industry where the best food to eat is now fertilizer free, pesticide free and, preservative free we have to be 'financially organic'. We have to go back to basics.

What does being 'financially organic' mean?

• It means remembering what is truly important in our lives. What are we really working for? The best question to ask yourself here is if you learnt you were dying tomorrow, what would you do and who would you spend your last day with? There aren't many people I know who are dying, saying, “I wish I had spent more time working!”
• It means living simply and doing without all the 'financial pesticides' in life. Robert Kiyosaki calls them 'doodads'. The best question to ask yourself here is if tomorrow you lose your job or your business closes down what would you keep that is necessary in your life? (This has happened to me). Hey our grandparents and great grandparents lived happy and simple lives without all the stuff we have today! There are so many simple and cheap joys in life. As long as we are with 'true' family and friends, and, we have the 'basic' necessities what more do you want!
• It means not going after money for the sake of making money (and all the material possessions and status symbols). You have to remember there are other important things in life – your health, your relationship with family, your god, and your friends. Hey what's the use in having a lot of money if you have poor health and no family and friends!

This financial crisis has shown us one thing. You can work your ass off and make lots of money but not everything is in your control and you can lose it all no matter what you do or how good you are. So if you aren't grounded in what's truly important then you might end up like one of those billionaires who committed suicide.

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

May you all reach your money goals in 2009!

2009 is here and most of us have had a good long break. I'm sure during these holidays we have at some point in time thought about money, particularly what will happen to us in 2009, from a money perspective. The problem is most of us STOP at this point! We just think about saving and hoping to become rich 'one day' and then realize it’s too hard to do anything about it. 'Bahala na!' is a common expression I hear.

Now I could go into a very detailed step-by-step way of how to do a financial plan but I would bore you silly and you still wouldn't take any action! So I'm going to give you a 'baby steps' strategy of how you can get started:

• Get a piggy bank. Or a box or container to put money you have saved in. Don't buy one! Make one if you have to.
• Set realistic goals. Something that will be easy for you to do, so you can get into the habit of saving. I don't care if it’s PHP5.00 or PHP10.00 per day! Just get into the habit of putting away something for your future EVERYDAY!!! In time when you realize that you can actually save, you will start to put larger amounts into your piggy bank. Hey PHP10.00 every day is still PHP3,650.00 in a year. And over 30 years compounded at 12% every year is PHP880,864.30!!! That's using one coin everyday!!!
• Remind yourself DAILY. Put an alarm on your cell phone or a note on your mirror. Just make sure that you are reminded daily that you need to save for your future.
• Don't touch the money! Invest it. Put the money you have saved into the piggy bank. When the piggy bank has enough money, put the money in a savings account that you don't touch or better yet, invest it in a mutual fund. You can start a mutual fund account with as little as PHP500.00.
• Get a Money partner. A money partner is someone who will keep you motivated to save money when the desire to spend the money is so strong. This person of course should also have the desire to save or is already a 'saver'. Hey, if you can't find one, email me and I will keep you motivated!!!
  

That's it. I wish you all the best in 2009. May you all reach your money goals this year.

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

Na Libre Ka? Invest Mo!

Whenever I finish an investment seminar, one of the questions I almost always get asked is - how can I invest when I barely have enough money to save? This is a fantastic question and one where I had to dig deep to find the answer. I found it while talking to one of my good friends. Like most people, during these times of economic hardship, she lives on a very strict budget so that what she earns covers all of what she has to spend for herself and her family.

What surprised me is that despite the tough economic conditions of today, she found a way to save! I was so fascinated with her system that I wanted to teach it to all my clients and seminar participants. Let's call it the Libre Method of saving.

The Libre Method works like this. The key criteria we have here is we have to first have a piggy bank (i am a huge fan of the piggy bank). Now let's start. I know you pretty much know what you spend each day on different expenses. For example, your daily transpo may cost you PHP100 a day and you know your lunch or snacks may cost PHP50 per meal or perhaps you buy you child a gift every week and spend PHP100.

Now what if on any given day instead of you going home the usual manner someone decides to offer you a ride saving you PHP50? What if on a given day its someone's birthday and decide to treat you for lunch saving you another PHP50? What if someone gives your child a gift saving you PHP100? What do you do with the money you just saved?

Normally you use the money that's left in your wallet and spend it on something else.
Today I'm going to ask you to do something different. Instead of spending it, I want you to save it and put the money in your piggy bank. (BTW, piggy banks love notes more than coins!) And every month, I want you to empty the money from there and invest it. Simple as that. Na libre ka? Invest mo!

Do you know that saving PHP50.00 a day over 30 years is nearly PHP3.2 million at 12% compounded return?

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