Here’s an article I wrote for my column at the Business Mirror a year ago, just thought of sharing this once more.

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Confession of a Financial Planner

MY wife Mia and I went on a date last night. Since my wife loves to watch movies and since the secret to a happy life is a happy wife, I instinctively knew she would prefer watching a movie.

I thought she would prefer watching the John Lloyd Cruz-Sarah Geronimo movie so I was trying to psyche myself to watching it, but I was so delighted to find out she wanted to watch something else. My wife knew I’m not a big fan of those movies so she wanted to watch something else for my sake. That’s one of the many reasons I love my wife so much—so unselfish! Not wanting to be a total jerk by asking her to watch an action movie, I suggested to meet half-way. As a result, we ended up watching the movie Confessions of a Shopaholic. I was actually intrigued by it because my daughter Gabbie said it was a great movie while another daughter Billie liked the book.

How was the movie? It was awesome! In fact, I urge everyone reading this to watch the movie. Watching it is like attending a financial-literacy seminar, only more amusing, more relevant and actually more effective.

The plot revolves around a character named Rebecca Bloomwood (brilliantly portrayed by Isla Fisher) who has an exaggerated spending problem and ends up being a columnist for a personal-finance magazine. The main character represented many of us, albeit in a humorously exaggerated way. We live in a society that is afflicted with a debilitating disease called “consumerism.” This burden has manifested itself in a “spending problem,” resulting in many of us  living a debt-ridden life—a life that robs us of true freedom and of victory.

As a financial planner myself, I was endeared with the character in the movie. Her column gives out a lot of practical and great personal advice and has a lot of followers, despite her financial life being in complete havoc. Well, I wouldn’t say I’m exactly like Ms. Bloomwood in the sense that I don’t really have a shopping addiction, and I’m not too sure if I do have many followers. While my financial life is not in havoc, it is far from being ideal.

Many times, I find myself “preaching” to myself whenever I write or speak. It’s not very wise for someone like me to say that I don’t have an “ideal” financial life, but I want people to know that I, too, experience the difficulties of putting my financial life in order. I went through a lot of mistakes that I have been trying to rectify. I was also afflicted with a spending problem that nearly left me in ruins. I made so much mistakes I later on regretted, which I wrote about in this column many months ago. But I learned from those mistakes and I am in a very long process of rectification. What is crucial is the realization of one’s problems and the resolution to learn from them, and have a lasting solution for them.

I do not only write or speak from a theoretical point of view. I am writing from painful personal experiences. We can’t “undo” many things we have done, but it doesn’t matter anymore as what’s done is done. Like anything in our lives, we must learn to stand when we fall. In doing so, we become more resilient, stronger and, most important, wiser.

Here’s a wise advice: To really fix a problem, go to the source of the problem. When I found myself with a financial burden, I tried many ways to “fix” it but I noticed that while some of those remedies worked, most of them did not permanently solve the problem. Like the many “solutions” we try, I found myself applying mostly short-term or “Band-Aid” solutions.

If we have a financial problem or a spending problem, we should determine the root cause of the problem. Is it the lack of income or the way we spend? Why do we spend the way we spend? In my case, I got into a financial mess because I had a “want” issue: I wanted this, I wanted that. It wasn’t just with me, it was with my family, too. But it was a “want” problem nonetheless.

Over the years, my “wants” became bigger and bigger and I found myself doing everything just so I can satisfy my “wants.” It didn’t really feel wrong at that time. In fact, some people might even say that it helped motivate me to work harder and harder. In retrospect, I now know it was very foolish of me not to have stopped my insatiable desire to want more and more. I am glad  I came into my senses and was able to curb my “want” issues. I guess those desires are still there as I am only human, but I have developed a strong willpower to overcome them.

How was I able to overcome my weaknesses? Simple. I merely reexamined what is really important in my life. Do I want to impress others because of what I have, or do I want others pleased with me because of my character? Do I want to please my family with a life that I can hardly afford and, as a result, become a preoccupied husband or father? Or do I want my family to be pleased with me because I am a real and approachable head of the family for them, always there when they need me? Do I want people to listen to me because of what I have accomplished, or do I want people to have hope that they can have a good future by learning from the mistakes that I chose not to hide?

In the end, I chose what really was more important. I chose to have a meaningful relationship with what really is important in my life—my family and my savior, Jesus Christ. In doing so, I found a permanent solution to my deeply rooted “want” problems—the cause of my financial fall.

I fell down, I stood up, but I know I’ll fall down again—all these happen because God is molding something that is very important in me: my character. “…But we also rejoice in our sufferings, because we know that suffering produces perseverance; perseverance, character; and character, hope.”—Romans 5:3-4 (NIV). Our character will determine our future, even our financial future.

This is my confession.

So what’s the problem with the pressures of education? Well, if we put nearly all our resources in it, we tend to neglect other things that are important, such as retirement. Let me use myself as an example. I have four kids. If I opt to send all of them to über-expensive schools at our current income level, I will not only neglect our retirement, I will be broke. My wife and I will not have resources to be able live a quality life after our kids leave the nest. As my youngest graduates, I will be retired. The pressures of financing their education will drain us to a point that as soon as I retire, my wife and I will be dependents. The question is, dependent on whom? Our kids? Isn’t that unfair to them? With the pressures of surviving, it will be severely difficult for them to take care of us while making a life for themselves. Isn’t that very irresponsible of me and my wife, as well?

Solution? Well, priorities and common sense. Yes, education is our priority as parents, but so is preparing for our own future. Let us not sacrifice our future in the guise of education. Look for balance, there are many other practical solutions. Look for schools that offer quality education without the hefty price tag. The success of a child does not come from the school but from the home. One study proved parents, grandparents and other older members of the family are better tutors than those expensive tutors or tutorial schools.

Another practical suggestion: Home School. If done properly, home schooling can help children fare better in life compared with those who went to expensive schools. Both husband and wife need to work to make ends meet; with educational costs taking a drain, it may make more sense if the wife stays home and home- schools the kids. Most mothers I speak to will often tell me that had it not been for financial pressures, they’d rather stay home and take care of their kids. Do the math: If you spend about P300,000 on education for all your kids and the mother makes just about P300,000, it is financially feasible to just home-school the kids.

Moms can take a job from the house or start a home business, as well, while taking care of kids, including their education. Fathers can help too; there are many things husbands should be doing to help wives—taking care of the kids should be up there especially when you decide to try home schooling. There are many good Department of Education-accredited home-school programs around at a fraction of the cost of normal big-school education. I’ve met a lot of home schooled kids who are doing great – smart, grounded, has great values and strong leadership. There are many successful stories around. CCF and Victory Christian Fellowship have really good home-school programs. They also have regular interactive programs that allow home-school kids to interact with each other. Imagine the savings if you home-school your kids. . . better yet, invest the money you saved from education and see it grow. . . . You will have more than enough for your retirement, for health care—with some extra to leave for your kids. Set aside part of the savings for their college education, as well, and invest it well. I guess I’ll do a follow-up article on tips on investing for the education of our kids. You can get many practical tips from http://www.income-tacts.com/ on educational investing.

Well, I did mention that I still have two more kids, Riggs and Chino, my wife and I are now home schooling them. I am sure we will be better teachers to our own children. . . so will you. Our decision to home-school our boys will allow us time to properly take care of our daughters’ college education. . . prepare for the boys’ colleges, save for retirement and hopefully enjoy quality living. It’s not good to worry, but it’s great to plan.

People say that it is quite a challenge to send our kids to school nowadays and I agree 100%!

Just how difficult is it? About 14 years ago, our eldest daughter Billie entered preschool. I can still remember her anxiety. . . how she didn’t want to be left alone in school and how she clung to her mom’s legs so tightly out of fear of her new environment. . . great memories indeed. Two years later, our second daughter Gabbie had a different experience. . . she didn’t have the fears of her ate and entered the school like a very confident little girl.

Aside from their first-day school experiences, I also remembered their tuition. My first child’s Kinder 1 tuition at her school was about P35,000, and my second daughter’s slightly increased to about P38,000. Today, me eldest daughter’s tuition is now about P 195,000 a year while my second daughter’s tuition is about P 105,000 – that’s a whopping 457% and a 176% increase respectively in a span of over a decade. These figures are not inclusive of books, uniforms, etc. — just tuition! By the way, I don’t have just 2 kids, I also have 2 more sons.

Our concern has always been about providing for our children’s educational costs and after sending kids to schools for over a decade, it doesn’t get any easier.

It’s all about priorities. Filipino parents are so admirable that they move heaven and earth just to send their kids to school. They labor, they sacrifice. . . . It is not uncommon to find deserving students in expensive schools even if their parents can’t really afford it. While that is indeed an admirable trait, it is also a big concern. Why? Many parents pour everything they have into their children’s education without really planning for themselves. The result? They will be dependent on their children in the future, an offshoot of putting everything in the education of their kids.

This is a very controversial argument. It is every parent’s concern and priority to provide for their children, education being one of them. I am not saying that parents forfeit this obligation; on the contrary, I often coach parents on how to properly prepare for education costs. But parents must put things in their proper perspective. The ability to provide for their kids’ education is commensurate with their ability to put their financial life in order. We can’t sacrifice quality living and preparation for the future in the name of our kids’ education. When it comes to expensive education, I often say “go!”, but just make sure you can truly afford it. There are preschools today that cost P200,000 or more. The sprouting of “international” schools that charge outrageous tuition is an indication of how we put value on education. I often ask myself if sending my kids to expensive schools is really worth it. Often, our finances are so drained because of education that we tend to sacrifice other areas like retirement planning, investments, etc.

Is expensive tuition really worth it? Is quality education really all about expensive schools? How much money do we spend on private tutors? We live in a culture that encourages sending our kids to schools—at a price we can hardly afford that it puts too much pressure on us parents. Sacrificing for our children’s future is admirable, and I agree with that 100 percent. But I disagree with putting our children’s hopes solely on educational institutions. Being a training professional myself, I know that the ability to teach people is not just about good teachers, materials and facilities. It’s really more than that. Honestly, did we really use what we learned in college when we started to work? Probably for doctors, dentists, lawyers. . . but for the rest of us? Hmm. Did school really prepare us for life? Do expensive, exclusive schools increase the chances of success?

There really is no way for us to validate these arguments, but there is something I am sure about. Not having gone to expensive schools will not prevent a person from being successful. How many successful people did not go to an expensive university? A lot! I often check out many executives and successful entrepreneurs for their educational background. There are just as many successful people who did not go to an expensive school as those who did….

Catch part 2 of this blog soon!