This year is my 22nd year in the financial services industry and I am a bit nostalgic. Aside from the fact that I am not as young as I think I am, I’d like to say that 22+ years have been eventful, to say the least. I’ve experienced a personal roller coaster but just like the old Glady’s Knight song, “I’ve had my share of life’s ups and downs, but fate’s been kind, the downs have been few”… thank you Lord. There are many things I am thankful for in the last 22 years of my professional life. Foremost is that for 19 years, I have a wonderful partner, my wife Mia who has also embraced my zeal and advocacies.

For many years, I’ve been blessed to interact with countless people, not only do I get to share my knowledge and passion with them, I get to learn a great deal from them as well. Rolly Robles, a former boss of mine once shared me the concept of S.P.I.C.E. – S for Service, P for Personal and Professional Growth, I for Income, C for Challenge and E for Enjoyment. If I sum up my many years in this industry, I’d like to say that the concept is pretty much accurate.

So what do I really do? Many things. I’m an speaker, writer, trainer, consultant and a ‘trying hard’ entrepreneur. But to be more accurate, I mostly help people plan their financial future or teach people on how to help other people. For the past years, I’ve been doing more of the later, in my capacity as a teacher.

Is it easy? Sometimes it is, but most of the time it isn’t. Acquiring the necessary technical skills can be challenging but financial planning isn’t really rocket science. There are gazillion books, websites, and training programs on personal finance. There are many credible sites in the internet on financial planning and my favorite local program would be the Registered Financial Planner Institute, where I stand as one of its Directors. Acquisition of technical skills isn’t all too difficult — learning soft skills so you can apply the technical skill are the hard part.

Telling people that they need to take personal financial planning seriously is easier said than done. Majority of Filipinos are more interested in many things other than personal finance. Our savings rates are amongst the lowest in the world. Filipinos with insurance coverage are likewise just as low. Less than 1% of us invest in the stock market. Mutual Funds, UITF, Index Funds are not something your average Filipino will know, let alone understand. I’m really excited about the PERA Law but I wonder if our brothers and sisters will take advantage of it properly once it is enacted (anxiously awaiting the implementing guidelines). Average people are aware that they need to plan for retirement but still fail to do so. Common reasons you will hear is that they don’t have enough money to plan with. Agreed, that’s enough reason — but isn’t that enough reason to take planning seriously as well? If income is hardly enough today, isn’t it logical to concern ourselves with proper financial planning? If living expenses are not enough with our income, how will we survive when we don’t have the capacity to produce income anymore? …

… to be continued.

Discussing about Personal Finance does not always have to be about internal rate of returns,peso-cost averaging, risk management, mutual funds, uitf, insurances and all those ‘boring’ stuff all the time. True, it is imperative that we are well aware of what I earlier mentioned but Personal Finance is also, well… Personal. Let me discuss something that is more close to home, especially to me.

I love coffee, brewed coffee to be more precise. I will not take anything butbrewed coffee. Don’t make me drink instant coffee, 3-in-1, I feel like throwing up whenever I am forced to drink those stuff, haha… I always hear so-called ‘personal finance experts’ tell their listeners to avoid buying brewed coffee from Starbucks and just take 3-in-1. I agree, buying coffee at Starbucks is so expensive and we should avoid it. If you are a certified Starbucks addict and buy their coffee regularly, consider this: Let’s assume that your average cost is P100 per day (some of their coffees are even much more expensive) or about P 3,000 per month. Let’s also assume that you can find an investment at about 8.0% p.a. (you can actually get better rates). If you invested your Starbucks expenses for the next 10 years consistently (monthly compounding), your savings will grow to P 470,543.30! If you are a risk taker and opted for riskier investments that will give you an average of 12.0%p,a. yield, your Starbucks expenditure can yield you P 593,626.24 in just 10 years!

Ok, point taken, forget buying Starbucks (well I still do from time to time). But drinking 3-in-1? Hmmm, I’m not sure if I’m prepared to do that. So what shouldcoffee addicts like me do? Brew my own! If you really can’t live without Starbucks Coffee, do the next best thing. Buy their coffee beans and brew it yourself. Buying coffee beans is a fraction of a cost. A 250g coffee beans at Starbucks costs you about P300… that can make you dozens of coffee already. If you are so fixated with Starbucks, you might even want to buy their Starbucks mug that they sell for about P400. One time purchase is all you need and you can experience the real thing, in a cost effective way.

Tips for serious coffee drinkers… the best way to brew coffee is through a coffee press, much better tasting than using automatic coffee makers and no electricity cost. Just dump your ground beans (coarse for press), add hot water, wait for about 2 minutes, and press… great tasting coffee! There are other great tasting coffee beans other than Starbucks — go to your local grocery and buy the cheaper local beans, they taste as good. But, my favorite beans are the mountain beans in Baguio. If you got a friend who is going to Baguio, ask him/her to go to the palengke and buy you a kilo of baguio coffee (mountain coffee is best) at about P200 per kilogram! That will brew you over a hundred cups, talk about cost savings and at the same time, great tasting coffee. Baguio mountain coffee is one the cheapest coffee I ever saw, and it is the best tasting coffee I ever had. Trust me, I know coffee! Batangas Coffee, Tagaytay Coffe… they’re all good as well.

More tips — avoid coffee makers that uses paper filters. It’s quite difficult to buy paper filters, costly and it actually reduces the flavor of your coffee beans. There are just a few people who still insists on using coffee paper filters — I don’t think they know how to drink proper coffee. The Coffee Press (also known as french press) is the best way to brew, but percolators, drip coffees are ok too. Starbucks sells coffee presses, pretty sturdy as mine is about 6 to 7 years old now. I also see coffee presses in department stores that can range for as low as P100.

I need my brewed coffee, once or twice a day. I will not take 3-in-1, ever — plus, instant coffee has a lot of harmful chemicals to make them soluble. I will argue that brewed coffee might even be cheaper anyway.

Take your coffee daily, and still save. No need to sacrifice quality for cost.  Okay, all this writing about coffee makes me want to go down and brew me a cup — I got baguio mountain coffee around, courtesy of a good friend who always knows how to make me happy. There are lots of practical savings tip at this site, you may want to check out this site and sift through the blogs. Before the readers think that Starbucks paid me to write this (I wish they did), I am not endorsing any coffee shop – I just want to make a point and write something close to home for many of us. Save money and drink your favorite Starbucks, its like having your cake and eating it too. Just drink it like I do. If that’s not Personal Finance for some ‘experts’ well, that’s Personal Finance to me! Happy savings, and have a caffeine blast!

“You who are simple, gain prudence; you who are foolish, gainSave  understanding.” – Proverbs 8:5, NIV

This is a column I originally wrote in October 2008. It is still a timely message today.

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I received a very interesting and timely text message from a very good friend, one who I really look up to. He gives me wise counsel, particularly in the arena of investments.

The message goes like this: “In market crashes and recessions, heed the H-I-T advice which stands for ‘Hang In There.’ During the ‘Height of Pessimism,’ there’s always H-o-Pe.”

That advice is so wise especially in these times of financial anxiety.

There is a lot of talk recently that people would rather keep their money in cold cash and sale of vaults has dramatically surged in the US.

While I agree that we should keep a portion of our money in cash, having everything in disposable cash is very unwise. Why? Well, crisis or not, we always have to contend with the fact that inflation will always erode our money. Keeping your money out of investments may help you feel secure but, in the long run, it would do more damage toward achieving your financial goals.

The antidote to crisis is opportunity. In times like these, we see investment and business-savvy people really jump in and look around for opportunities. When things are on “Sale,” we tend to buy things—that we normally wouldn’t—because it suddenly becomes cheaper. Many of us are guilty of such practice.

We can use the same mindset in investing, particularly in the stock market today. If you look at the prices in the stock market today, you will see many of stocks priced really low, some even below its book value. I’m not referring to speculative stocks here but to the tried and tested blue-chip stocks that are fundamentally strong and highly profitable.

There are many stocks that are on their 52-week low or very near it, like Ayala Corp., BPI, Banco de Oro, SM, Globe, Metro Bank and even the favorite PLDT. If you have money to invest and you are willing to invest it over a long period, say five years, then investing in the stock market may be a great idea.

Of course, you must always consider your risk tolerance—if you can’t tolerate volatility, the stock market is not for you regardless of the buying opportunity today.

Keeping calm in these times is crucial; be steadfast and avoid the stress brought about by panic. The best form of risk management is not keeping your money in vaults; it is diversification.

What determines the performance of your investments isn’t so much about selection and timing. It’s allocation. While it is always a great idea to be prudent with our investments, we must also understand that things operate on cycles—there are good days and there are bad days.

You can bet that people like Warren Buffet and Henry Sy and his family are not keeping their money in cold cash. They are busy looking at many opportunities—and that’s the reason they are, well, rich.

Let’s take the case of Henry Sy’s family. Economic activity does not deter them from being bullish in their investments. Even when the gross national product is really low, SM opens malls. Why? Well, for starters, things are cheaper when the economy is slow, particularly real estate. They don’t look at economic statistics, they look at golden opportunities.

Remain calm and focus toward the end goal: your investment objective. Here’s some great advice from the world’s richest man, Warren Buffet: turn off the stock market; buy a business and not a stock, you don’t sell your business immediately when times get rough, right?; don’t worry about the economy, buy companies that profit regardless of the economy; manage a portfolio of business; diversify.

Such wise counsel in times like these. No wonder he is that rich!

For those who are feeling the anxiety of the looming crisis, be still. Be comforted by the fact that we are in a cycle, it is down today but it will be up tomorrow (hopefully).

I find comfort by consulting the best business, investment and practical-living book of all time. A book that is not just timely, it is timeless —the Bible. Romans 12:12 (NIV) says: “Be joyful in hope, patient in affliction, faithful in prayer.” God’s words really help bring clarity to our hearts and minds.