The Secret to Being a Good Teacher

This year one of my part-time jobs was being a tutor to a middle-aged mom in the same condo complex where I used to live. It was actually my first time to teach an adult learner but not my first try at tutoring. I had also taught this young boy years ago but that was a short gig because I quit after just a few sessions.

The reason I lasted longer with this adult learner was that I finally unearthed the secret to being a good teacher (or tutor). The secret is that most students fail in school not because they’re stupid or feel like they know it all, and not even that they dislike the teacher. No, my experience told me that most students fail at school because they are AFRAID.

Students are afraid of school and learning because they don’t want other people to know that they don’t know the answers to the questions being asked. Students are afraid of their teachers humiliating them in front of the class. Students are also afraid that their fellow students (especially those who perform well in school) will make fun of them for not knowing the answers to the questions too. This is the root of juvenile delinquency – the fear of the unknown. Once I had realized this fundamental truth, it became easier for me to adjust to my student.

“Wait” you might be saying. “Shouldn’t the student be the one to adjust to you? You’re the teacher.” Well, the reality is that both sides have to adjust to each other. I had to adjust to my student by acknowledging that she is afraid that I will make her feel stupid. She had to adjust to me by acknowledging her fear and telling me what she was afraid of. Once we got past that stage, it became easier for me to teach her.

When your student tells you what she is afraid of, you learn to create lessons out of the academic topics that you can explain to her in terms that she will understand. So instead of acting like a professor in college who would talk using big words that people in the academic world seem to like to use, I had to scale down my language and explain the lessons in terms that she could grasp and that didn’t seem like they were obscure or difficult to understand. When necessary, we would repeat the lesson day after day until finally a light switched on in her head and she got the core of the lesson.

I had to learn patience and humility through this process, because she already knew that she didn’t understand the topics so I didn’t feel the need to point that out. Rather, I had to observe the way she would go through the lesson, waiting for the times when she would pause (puzzled by a part in the lesson) then I would explain that part again to her. I had to build up her confidence by staggering the lessons into small steps for her to go through so that she could see that big lessons are just small lessons summed up into a whole. I also had to acknowledge that some lessons were vague to me or that I had forgotten them so I had to go through those lessons again just to know how to teach them to my adult student.

The point to all this is that (in this age of soaring tuition fees and schools that are ineffective at educating due to overcrowding) we teachers must realize that our “business” is more of an advocacy and a lifestyle than a business. Yes, it does cost money to train teachers and it does cost money to educate students. But once we realize that the key to educating is to acknowledge that our students are afraid then more students would be able to overcome their fears because their teachers now know what the root of the problem is. And that would mean more students will excel in school and our country would have a brighter future because our human capital will be ready for the challenges of the labor force. So if you are planning to become a teacher, you should practice now how to get the trust of your students – and you will be surprised how they will bloom under your tutelage. That is what I know for sure.

Why I Won’t Hire Employees for My Company

When I was still a regularly-employed employee at my first job, I encountered co-workers who were not ideal employees. And that’s putting it mildly. Some of them would deliberately try to hack into and change the settings of the Local Area Network (LAN) just for fun. Others would destroy the company office equipment like the office chairs, also for fun. Some were also kind of weird because they would apply for employment at the company then resent it when they were asked to work already.

Needless to say, my experience working with such people simply convinced me that working alone is sometimes really preferable to working with a host of strangers. True, some people might enjoy the company of their co-workers (and yes, even at that job I mentioned I did have some friends among my co-workers) but the odds that you will have to work beside a weirdo in the same office are quite high nowadays. That’s one reason I decided to become a freelance writer and that is also the motivation behind my setting up my own company named Quill Writing and Translation Services.

So obviously, I won’t be hiring any people to work at Quill. I have gotten used to the pace and the peace of working alone as a freelancer. At Quill, I am only answerable to myself and to my client. I can work as fast or as slow as necessary. I can adjust and make changes when necessary. And of course, I can turn down work also when necessary. The decisions are all up to me and the consequences are fully absorbed only by me. True, it can be terrifying sometimes being alone in your own company especially when you encounter a new writing topic that is outside your comfort zone. It can also be uncomfortable especially when you are approaching a deadline and you think that you aren’t working fast enough to meet that due date. And of course, when you make mistakes, you only have yourself to blame and no one else.

But hiring people brings with it its own set of difficulties – and I don’t want that in my life. My job is complicated enough without hiring strangers to do certain tasks for me. And the good news is that there aren’t really that many tasks that I would need to hire for. So life for me has become much easier ever since I decided never to hire any employees for my company, regardless of who those people might be.

A Link to Timeline Investing

http://www.rappler.com/business/personal-finance/65352-timeline-investing

Why do you invest? Should you invest? Check out this article now.

Why I Don’t Use Feng Shui In Business

I am actually one-fourth Chinese because my paternal grandmother was pure Chinese. However, I was not raised Chinese. In fact, I consider my Chinese influence to be minimal, confined mostly to accompanying my father when I was a child to Binondo where he would go for acupuncture treatments. And even though I am part Chinese, I don’t use feng shui in my business transactions. Two of my siblings though are avid feng shui practitioners.

When I was younger, my older brother would tell me to read some feng shui books he had bought to get an idea of how feng shui works. However, after reading these feng shui books for awhile I would give up and go do something else instead. Not only did I find feng shui to be extraordinarily boring but the books made me dizzy. I guess I really don’t get the way feng shui works. All I know is that my birth year is Water Ox with water being the sign closely associated with Christianity and the Ox being the animal of people who are industrious, patient and hard working. And that’s pretty much it.

I have heard though that there are people (not just those who were born and raised Chinese but also those who just like to believe in feng shui) who will not go into business or do any transactions like buy real estate unless the feng shui signs are “favorable”. To me this doesn’t really make sense but I respect those who are really into feng shui because feng shui might really work for them, even if I can’t make it work for me. To each his own, I say.

My sister told me once that our father was also a follower of feng shui but I can’t remember a single instance when he would practice feng shui with me or in my presence. What I do remember about my half-Chinese, half-Tausug father is that he was a follower of Islam. So maybe I missed out on that Chinese influence somewhere down the line. But it’s okay because not practicing feng shui has not really affected my business practices in any way so far, so I suppose I won’t be needing feng shui anytime soon for any reason.

What is Quill Writing and Translation Services?

I formed my company Quill Writing and Translation Services last year upon the advice of my sister. Like the name suggests, my company is all about writing services and translation services. At first, I concentrated mainly on writing but I have also been able to do some translation jobs too (mainly English-Tagalog translation work).

The value of having my own company is that it helps me form my own business identity that is independent of any one else’s. Of course, there are also some hardships that come with having your own company. For example, I have to pay for the registration of my company by myself. It cost me 2000 pesos just to get a national registration at the Department of Trade and Industry (DTI) – national because my clients are mostly foreign individuals and corporations. I also have to pay for a bookkeeper and to have official receipts printed out of my own pocket. In addition, I will need to figure out which clauses in taxation laws and procedures in the Philippines apply to my company.

The benefit of having my own company is that it looks so cool being able to put my digital signature at the end of my gmail emails. I feel a sense of pride in being associated with the name of my company and knowing that this company is mine and no one else’s. When I think of my company I automatically think “How can I make my company better today?” When you work for someone else’s company you may feel that somehow there is a lack of fulfillment because you know that that company will never be yours. On the other hand, when you work for your own company you are motivated to make it better than it was yesterday all the time.

Of course, having my own company also means having to look for my own clients which also means working for other people. That part hasn’t changed – you will always need to find people to serve with your company. But because my company is my brand I know that I stand to benefit over time if I can sustain my work momentum every day.

What I Have Learned So Far From Investing in Mutual Funds

It’s been 12 days since I started monitoring the performance of the Sunlife Equity Fund that I invested in (with help from my Financial Advisor Sasha So Seng Yu) and I’ve learned about some facts about it that are important. I must admit it took some time before I understood these facts but with help from Sasha it became clearer to me how to assess the performance of my shares so far in this Equity Fund.

First of all, I learned how to monitor by myself the performance of the Equity Fund. I simply go to sunlife.com.ph and look for the NAVPS acronym at the lower right hand side of the home page of Sunlife. I click on that and that brings me to the table where the daily performance of the Equity Fund is listed (along with the other mutual funds that Sunlife administers). The column for the NAVPS is listed in the table and that is the Net Asset Value Per Share for that day. I take that NAVPS for that day and multiply it by the number of shares that I own in the Equity Fund. That gives me the value of my investment for that day alone – this is called the Fund Value.

Second, there are two other values that are important to take note in the same table. Beside the NAVPS is the YTD or year-to-date returns. Sasha says that means that is the performance of the Equity Fund starting January 2014 up to the date I am checking the NAVPS. So far the Equity Fund has been performing well so no complaints there. Then there is the YOY or year-on-year returns. That means the performance of the fund beginning the same date the year before up to the date I am checking for this year. That’s a bit confusing but mainly it means if I am checking the YOY on November 7, 2014 then the YOY starts from November 7, 2013. So the YOY measures the performance from November 7, 2013 up to November 7, 2014 (exactly one year).

I have found that it is important to keep a notebook solely for noting down the NAVPS for the day. It helps keep me focused and clears up confusion if I am not sure what the percentages in the NAVPS table means. I assume that eventually it will become second nature to calculate in my head what the NAVPS is for the day actually. But it’s still important (according to Sasha) to note down the NAVPS especially to compare to the first day when my investment was formally funneled into the Equity Fund. That way I can benchmark the progression of my investment in the Equity Fund over time.

There is actually some other stuff that I have to learn so it is good Sasha gave me the prospectus for another Fund that is administered by Sunlife. I am still reading it to absorb the acronyms that they seem to use as shortcuts for the terms. However, I must always bear in mind that many parts of the prospectus don’t apply to the Equity Fund so I have to be careful not to jumble the parts of each Fund together. But so far that is what I’ve learned and I’m okay with the performance of my investment at this point in time.

How to Survive the Competition Faced by Your Business

I have a close friend right now who has way more experience in business than I do and whenever we get together I like to listen to her business experiences closely because I learn more from her by listening than by talking.

One day she told me about her experience setting up a food cart at the MRT. The MRT food cart sold siomai which is actually very easy to prepare and cook and lends itself well to the fast food business model. Nowadays there are so many siomai food carts all over Manila but back then her family was the first to do so at that MRT station.

Everything was okay for some time. The siomai product was a bestseller and they were making profits from the business. However, problems arose when five (yes, you read that right – FIVE) other siomai food carts set up shop at the same MRT station. Having that many competitors meant that my friend had to share the same market with her rivals, which cut into her own profits. Even though MRT stations are usually crowded with passengers, apparently the smaller profits of my friend meant that she could not sustain the business anymore. So she had to give up the siomai food cart business and her business folded.

In any business (not just siomai sales) you have to contend with competitors. However, it doesn’t mean automatically that you would have to shut down your business just because competitors are raring to enter the same market you are in. There are some ways you can protect yourself so that your business has a fighting chance of surviving a highly competitive market and even attaining a high degree of profitability. Let’s check out these ways, shall we?

1) Make sure your product and/or service adheres to 100% quality standards. Just because you have competitors breathing down your neck doesn’t mean they offer the same quality product and/or service that you do. Although you cannot be sure what kind of quality your competitors are offering, you can be sure of yours. So always set high quality standards for your business to follow so that customers will be pleased with you.

2) Try to locate your business in a market where the management won’t let too many competitors enter. Some places, like schools for example, make sure that their area will not get saturated by businesses that are all alike or too similar to each other. You may need to look a bit further than usual to find such a market but this is important for your long-term survival. Such places often stipulate in their contract that they will not let rival companies/businesses set up shop in the location you have chosen – this is good for them as the landlord because it means the rent/lease you have to pay them will be uninterrupted because your business will survive and thrive. It guarantees a long term business relationship between you and the landlord and naturally you want that.

3) Be prepared for dirty tricks by the competition. Business can be a cut-throat competitive world so don’t assume that your rivals are angels. Some dirty tricks that you might come to expect are a) badmouthing of your business by the staff of your competitor; b) annoyances like garbage dumped right beside your location; and even c) downright sabotage like cockroaches released in the vicinity of your food cart. Yes, such things do happen and it’s not all in my imagination. So if your rivals resort to such dirty tricks, your best action plan is to approach the management of your landlord and ask them to correct the situation. Be sure to document these dirty tricks so that you have grounds for a complaint if your rivals resort to worse things.

4) Be sure that your pricing is fair and that your ideal customers can afford it. In the case of my friend, they did price their siomai fairly and they were pretty sure that their customers could afford it. So at first, this business strategy worked. However, their five other rivals seemed to have resorted to the same pricing tier which then meant that they were all offering the same siomai at the same price. So this leads us to number 5 which is…

5) Have something special to offer to your customers that your rivals can’t offer. In the siomai business this could mean offering an extra piece of siomai for every order of regular siomai or offering a free drink maybe per order. Or you could create an extra special type of siomai that your competitors could only dream of creating themselves. In the world of business it is very important to have something unique to offer because customers like variety and offering variety means that your competitors have to work extra hard to offer something unique also.

Naturally, the winner in all this is actually the customer because your target customer will have something great to buy from you or your rivals at any given time. But if you follow these tips your business may last for a longer time than it would if you simply sit back complacently. So look forward to the survival of your business if you keep innovating this way.

The Value of Having a Passbook Savings Account

I was analyzing my savings patterns this year and I came to the conclusion that I really needed to get into the habit of saving more regularly. Fortunately, I came across this bank named China Bank Savings near the condo where I live that is open from Mondays to Sundays from 10 AM to 7PM. Because the bank is open until the evening and even on Sundays, I decided that this bank is very convenient for my needs because I can always go there after office hours and on Saturdays or Sundays to deposit my money. So I opened a passbook account there.

Why a passbook account? As I was analyzing my spending patterns, I realized that it is hard to save using an ATM account because it is so convenient for me to go to any ATM and just withdraw money. True, the ATM will give you a printed receipt of how much you withdrew and how much is remaining in your bank account. However, it is really so tempting to withdraw 200…then another 200…then maybe 500…until you realize that your maintaining balance is so dangerously low already and you’re on the brink of losing the account. Because of this, I chose to open a passbook account at China Bank Savings instead.

The value of having a passbook savings account is that you will always know how much exactly you have in your account at any given time – all you have to do is open your passbook and there it is printed out for you. You also get to see how much you keep depositing or withdrawing over time by glancing over the past transactions. It is also harder for a thief to get money from your passbook because he/she would have to present proof of identity, meaning the bank staff won’t allow the thief to just get your money just like that. (With an ATM card the thief can use your PIN to get all your money right away.) A passbook is also a good way to prove capacity to pay for other financial transactions such as when you open a postpaid cellphone account at a telecom service provider.

When I opened my passbook account at China Bank Savings, I had to present 3 valid IDs (in my case I presented my SSS, PWD, and TIN ID cards). This allowed them to see that I have a good record as a citizen of the Philippines. It also helped that I had owned a passbook account at their head office in Ayala Avenue, Makati before (though that account was eventually closed). So they just asked me to sign different documents and within an hour I already had my valid passbook.

I have the habit of going to this bank regularly to deposit my money. For example, after I am done with my tutoring job my student pays me right away so I go to the bank to deposit the payment. That way I am not tempted to spend on anything. Because I did this consistently I was able to accumulate enough money to invest into that Sunlife mutual fund that I opened with help from my Financial Advisor Sasha So Seng Yu. So I know that my system really works because I was able to save a lot of money over time. I conclude then that having a passbook (as far as I’m concerned) is a good way to keep track of your savings, so much so that you can accumulate enough funds that you can then choose to use for big expenses or to invest (depending on what and where you believe your money should go to).

The Difficulties Of Being a Network Marketer

I am part of two network marketing systems. The first is Usana which is a health food supplements company and the second is Sante Barley which also sells some health food supplements. I got into Usana because my close friend Joy Ferrer recruited me. I got into Sante Barley because my sister recruited me. However, I haven’t found it easy to pursue network marketing with either network – and that’s my story for today.

In Usana, I was very happy with the health food supplements I tested. Joy sold me a small amount of the Essentials multivitamin, multiantioxidant, and multimineral products. I found them to be very wholesome and really good for my health, even from the first sample I tried. When I notified my sister about it, she told me to go for it and sign up for a Distributorship under Joy’s network. She even gave me the initial amount to buy-in so that I would qualify for the Distributorship. What convinced my sister that the Usana Distributorship was worth our time was that the Essentials helped lower her BP which has been problematic for her. I found that the Essentials made me feel much better overnight. So we were definitely sold on Usana.

With Sante Barley, I wasn’t really that sold on the products. Maybe it’s because the barley capsules didn’t make me feel better overnight like the Usana products did. However, I held on to my Sante Barley Distributorship because my mother does believe in the barley capsules so every year I buy for her in bulk – and that is how I managed to hold on to my Distributorship even if I don’t promote Sante Barley.

You might be wondering at this point “So what’s the problem? What difficulties did she encounter in network marketing?”

Well, the first difficulty I encountered was that it is very hard to find paying customers for network marketing products. One reason it is difficult is that there are so many products out there competing for the attention of the buying public. Some of these products are endorsed by celebrities which is the company’s way of trying to keep itself visible in a crowded market. The more famous the celebrity, the more famous the product the celebrity endorses becomes. And that makes it easier for the network marketers to sell the product. Even if your product is very good, if you can’t get the attention of the public you will find it hard to sell. And if you don’t sell inevitably the company will go bankrupt and fold.

The second reason I find it difficult to survive as a network marketer is that many people hereabouts in Manila simply cannot afford what I am selling. Usana is a very good source of health food supplements but many people balk at the prospect of paying for the products by the bottle. Yes, there are a lot of people around me who definitely need these Usana products but they don’t have the cash to pay for it. A lucky handful of Distributors are able to thrive because they cater to the A-B-C markets – but if there are already Distributors serving this market, that kind of squeezes out the less lucky Distributors from being able to serve that market as well. So you would have no choice but to serve the D and E markets who cannot afford to buy what you are selling. And that means you go broke because you keep on marketing the Usana products but there is no income coming in.

The third reason I find it hard to be a network marketer is that some people consider health food supplements to be an unnecessary expense. Yes, they know the Usana products are good but they would rather spend on “more necessary” things than on health food supplements. Yes, they know that the Usana products would help make them healthier but they may have other priorities such as the tuition of their children or this month’s electricity bill. That is why rich folk are the favorite market of network marketers – the rich have surplus income that they can funnel towards products that make them healthier. Those who don’t have surplus money would rather not buy health food supplements at all because of this.

The fourth reason I find it difficult to survive in network marketing is that it is a networking business. That means that you are required to recruit more people into your network so that they will become Distributors and also market and sell the same products you do. True, there are financial incentives if you manage to recruit people who are very good at selling and recruiting people themselves. But it is hard to find the right people for this and often, the people you recruit might drop out of contention if they find it difficult to sell through network marketing. Sad, but true.

Lastly, the reason I also find it difficult to survive as a network marketer is that I don’t seem to have the personality for sales. It was my younger brother who pointed this out to me: he said “You’re not a people person so you don’t belong in sales”. I guess he’s right because my Usana and Sante Barley network marketing businesses are stagnant at the moment. I’m so much better at being a writer, a tutor and pursuing academics than being a network marketer. Still, I hold on to my Usana Distributorship because I like the products and can get them at the much lower Distributor’s price for myself. I stay with Sante Barley because my mom likes the products and I can also get them at Distributor’s price for her. So I won’t get into other network marketing distributorships anymore because these two are all I can handle for now – and maybe someday I’ll get that big break and land myself select paying customers who need, want and can afford what I am selling.

Tips On Buying Real Estate in the Philippines

Because of some personal reasons, I decided to ask my Sunlife Financial Advisor Sasha So Seng Yu about how I would go about buying real estate in the Philippines, specifically in Manila. Sasha is not just a Financial Advisor - she is also a licensed real estate broker. Her niche is selling condominiums to the A-B market. I asked her specifically about how I would go about buying a condo for myself.

Sasha said that I would first have to compute my budget for buying real estate. In my case, I asked her if 10,000 per month would be enough to pay for a condo (probably a studio type because I would live there alone). Sasha said that it is possible to buy a condo with 10,000 per month but that she personally sells condos that go for a much higher monthly payment than 10,000 pesos. So I guess the amount I specified would apply for the lower-end condos.

The downpayment is another important consideration because the condos that Sasha sells require a 30% downpayment. So the downpayment for a condo for me is 30% of the total selling price. What this means simply is that if Sasha were to sell me a condo whose selling price is 5 million then 30% of that is 1,500,000 pesos. That’s aside from paying monthly payments for your payment scheme. Sasha said her condos would require 5 years to pay the balance – meaning, if I already pay the 1,500,000 downpayment I would need to divide the balance of 3,500,000 by 60 months or 5 years to pay. That means I need to pay approximately 58,334 pesos per month for 5 years. Wow.

Sasha also mentioned that I need to consider the “location of interest” or where I would prefer to live. Some places are more expensive to live in than others. For example, I have a friend who lives in The Fort and she bought her condo for 7.5 million pesos.  Another friend of mine lives in The Fort also and her condo probably cost 12,000,000 pesos to buy. It is interesting that the location would have a big impact on my lifestyle because Sasha did say that I need to consider the lifestyle I wish to lead if I’m buying real estate. My lifestyle would dictate how happy I would be living in that location – for example, if I like to be near places of entertainment like cinemas and prefer to shop near home for weekly food marketing then I would need a condo located somewhere that offers those.

Because I told Sasha that a condo costing 5 million pesos total selling price would be a bit costly for me, she then said that “you can get a good condo for 3 to 4 million”. So if I were to buy a condo worth 3 million total selling price then the 30% downpayment = 900,000 pesos while the 5 years to pay will require monthly payments = 35,000 pesos per month. If I were to buy a more expensive condo in the range of 4 million total selling price then 30% downpayment = 1,200,000 pesos while monthly payments = approximately 47,000 pesos per month.

So obviously you need to have capacity to pay if you intend to buy real estate. Take note that this is just the initial computation, meaning there might be other expenses as well that I would need to factor in. Also, since Sasha is based in Manila like me, the prices she quoted are for the Manila market. But for now, Sasha gave me a good idea of how I would go about buying real estate for myself. So that’s food for thought for me at this point in time.

How to Encourage Children to Become Business Savvy

Because my mother is a Certified Public Accountant (CPA) by profession, it was important for her to train her children early in the basics of business. In fact, I cannot remember a time in my youth when my mom was not training us in business related activities.

For example, when my sister and I were still studying at Maria Montessori Cooperative School (MMCS) my mom would join the bazaar hosted by the school to sell various items. We would help (well, sort of help) by manning the booth or carrying stuff for our mom. I remember once she sold cactuses because my mom is really into gardening.

At our little porch in the rented two-story apartment where we lived, my mom would open a very small sari sari store that would sell the usual stuff that sari sari stores sell such as candy. (I would often be punished because in my mind I thought the candy was for us her children and would take what I wanted when I wanted). Eventually, I realized that the store was selling the candy and so I stopped taking it.

In grade school, my parents made sure I would learn how to enroll myself in school, even to the point of paying for my tuition by myself. St. Scholastica’s College made that easy for me because they had a checklist of all the activities you had to go through to enroll yourself. So it was really just a matter of getting the checklist then ticking off each activity when you had finished doing it. The last step was paying for the tuition and getting the official receipt, then bringing both the checklist and the OR home to my parents for their approval. I remember I would do this as early as Grade 4. Of course, being a child I was a bit nervous about doing all this myself, especially since the other kids had their parents along with them to do this for them. But I realize now that my parents must have trusted me a lot and known all along that I was capable enough to be independent as early as that age.

My mom also made sure we saved money from our allowances in little bamboo “piggy banks” that she brought home. This had a double effect on us – on the one hand, we learned how to put money regularly in the piggy banks. However, we also learned how to remove money from the piggy banks whenever we wanted to buy snacks or candy. So that wasn’t so good. But the lesson there was that after the piggy banks were reasonably full, we would bring the money to the bank for deposit.

Because of the TV commercials of Lea Salonga for the Banco Filipino bank, I nagged my father to help me open a kiddie bank account at Banco Filipino. Lea Salonga was my idol and I thought that I’d be more like her if I opened a kiddie bank account. The good part is that instilled in me at such a young age the value of having your own bank account and saving money regularly. However, Banco Filipino was not a well run bank and eventually it folded due to bank runs. My mom had such an awful time getting my money out of the bank because I forgot what my signature was. But I think eventually she was able to withdraw all my money from my kiddie bank account and I presume it’s stashed away somewhere safe (we never talk about it anymore nowadays).

Then of course there was the weekly marketing that my mother assigned to me. Every week when I had reached adolescence, she would give me a marketing budget for the food of our family. It was my task to go to the wet market (sometimes alone, sometimes with the maid) and shop for the food. This was very important in my business training because it taught me to divide the weekly budget into the reasonable portions for each item that I had to buy. It also taught me to be accountable for money entrusted to me so I had to learn how to write a record of the money spent and what it was spent on to present to my mother for approval.

My father, on the other hand, trained me and my sister in how to earn money (not just saving it or investing it). When my sister and I were in my father’s office, he would give us secretarial tasks such as helping him file away documents. I learned how to punch holes in folders so the documents could be properly filed in them. I also learned how to control my handwriting when creating labels for the folders. I envied my sister at this because her handwriting was way better than mine (and to this day, she still has the better handwriting between the two of us). My father paid us for these tasks, of course. Another task my father assigned to me was to weed the lawn of our house in BF Homes. For some strange reason, I don’t remember him assigning this task to my older brother or sister, ever. My deal with my father was that the weeds I pulled up had to have intact roots to be deemed eligible for payment. If I couldn't present the weed intact with its whole roots, I would only get half price for my effort. At first, I tried to argue with my father about this, until I realized that his decision was final and could not be changed.

The point to all this training was that my parents were able to give us an idea of the basics of business which are: a) that you have to work to earn money – only a minority of people get a free ride through life; b) that you have to be responsible with the money you earn, by saving what you have earned and then putting the money away in the bank; and c) that money can help you buy what you need, if you’re careful with it. My parents also taught me to be accountable for other people’s money and that if you are consistently honest with how you use other people’s money then you get rewarded for your honesty. So I have to say that my parents really knew what they were doing by making us go through all that starting from a young age.

A Link on How to Spend Your Christmas Bonus

http://www.abs-cbnnews.com/business/11/03/14/you-spend-your-christmas-bonus-read

This link was shared by my Financial Advisor Sasha So Seng Yu on her Facebook timeline. It's a good read so do click on the link.

Trust – The Most Important Element in Business

In the past, when I was at my first job, my life insurance agent at PhilamLife committed estafa. I was making advance payments for my life insurance plan but she wasn't remitting the money to the company. She also didn't issue me a provisional receipt for the money I handed over to her. Needless to say, that proved to me that she was not trustworthy and it created all sorts of headaches for me. So I let the policy lapse.

Then I got another life insurance policy from All Asia Life, from an agent who was my college barkada. But that didn't pan out well either because All Asia Life went bankrupt. Apparently, they were not up front about the type of investments they were making with clients’ money. Again, that meant the demise of my life insurance policy.

These two incidents proved to me what my Financial Advisor Sasha So Seng Yu likes to say: that she values the trust of the client more than anything. And trust really is what business is all about.

In the world of financial institutions, it is hard to survive because there are so many companies fighting it out for the trust of clients/customers. In life insurance alone, you will find many players that all claim to be the best insurance providers. Not surprisingly, many people who are interested in getting a financial product like life insurance rely on word-of-mouth endorsements from people who have already had a good experience buying life insurance from a particular company before. After all, these people who endorse a particular company are already satisfied with the level of service and honesty of their chosen agent/financial advisor. So that is good news for that agent/financial advisor. But it is also good news for those potential prospects because they can rely on the feedback of their friends/relatives/colleagues/business partners when selecting financial products to buy.

The flipside of that coin is that when an agent/financial advisor does something to offend the client that valuable trust can disappear in a second. Like I said, when my first agent committed estafa I lost my trust in her. One of my mentors in business made it a point to tell me “clients/customers will buy YOU before they buy what you are selling.” So if you go into selling financial products, you need to have a blemish-free reputation and so does the company that you represent.

Trust is also important when an agent/financial advisor accepts a prospect as a client. This means the agent/financial advisor also has to check out the prospect if he/she is also trustworthy because the agent/financial advisor wants to avoid creating problems for herself and for the company she represents. I guess you can say that the agent/financial advisor needs to be good at reading people. Even if the prospect has enough money to pay for the financial product, there may be times when an agent/financial advisor has to turn down a prospect because she can sense that there is something not quite right with that prospect. Better safe than sorry.

This is why financial institutions make it a point to safeguard their image in the world of business. Because even a small incident brought about by being dishonest can tarnish their image, sometimes permanently. Since agents/financial advisors represent the company, it is equally important that they too have a sterling reputation that is free from even a hint of dishonesty.

That is why when I found out that Sasha, my current Financial Advisor, was selling financial products I decided that I could trust her with my money. She was my friend first before she became my Sunlife Financial Advisor. You can say that I “bought her” before I bought her financial product. I told her that I was trusting her because she was consistently honest with me on all levels. So that is good for both of us, because I get to invest my money through a trustworthy Financial Advisor and she gets a new client (me) which is good for her business. If she and I are able to foster that trust over time, then that creates a good business relationship that benefits both of us. And that, in a nutshell, is how an ideal business relationship can and should be actually over time.

My Financial Life Strategy

Back when I was still asking my Sunlife Financial Advisor Sasha So Seng Yu to process my life insurance application, I had lunch with a close friend of mine. She taught me to compute for my “Financial Life Strategy” as she called it, which is basically computing how much I would need to live on when I have already retired from regular work and would need to derive this “living allowance” from what I had invested when I was younger.

So first, my friend asked me what age I am now (which is 40) then she asked me what age I intend to retire (and I said 80). She was taken aback by that (but I really don’t intend to retire actually, because like my medical idol Dr. Augusto Litonjua said “what would I do with myself if I retire?”) I’d probably be bored to death not doing anything all day, after a lifetime of being active and being in the writing profession. So the formula then is retirement age (80 years) less my current age (40 years) = 40 years left of work. Assuming the Good Lord allows me to live that long that is.

She then used this formula: 72 divided by 6% inflation rate = 12 years. She didn't exactly know how her source came up with the number 72, except that it’s an actuarial fact. She used 6% inflation rate because that’s what her insurance agent used to compute for my friend’s life strategy (which is not far from the truth because I think inflation is at 5% right now). The 12 years means that every 12 years of my life starting age 40 I would have to double my living expenses.

So what does that mean? It means that at the moment my monthly living expenses is at 25,000 pesos per month. That means 25,000 pesos x 12 months in a year = 300,000 pesos for year 2014 alone. But since every 12 years my living expenses will double so at age 52 my expenses become 600,000 pesos per year, at age 64 my expenses become 1,200,000 pesos per year, and at age 76 my expenses become 2,400,000 pesos per year. She stopped the computation at age 76 because I already got the idea clear in my head.

It gets more interesting now – she said I’d have to have “seed money” of 24 million pesos invested at a 10% interest rate so that by age 76 I would have a regular influx of 200,000 pesos per month for living expenses = 2.4 million pesos per year. Of course, that’s assuming that I’d somehow be able to come up with 24 million pesos by age 76.

Having left me with such happy thoughts, my friend didn't explain how I’d manage to come up with 24 million pesos seed money. But I checked my own current income. I am currently being paid 220 pesos per hour as a writer. That means eventually I’ll be working 8 hours per day at that rate as a writer. And that money is just enough to cover my current living expenses. So what that means is that I would need 228.3105 pesos per hour in surplus income for 8 hours per day for 365 days per year for 36 years.

In jest, I told my friend via text “I guess I have to suck up to my boss then so he’ll give me that surplus income”. However, that amount is not really far off from reality. It just means that I have to do really well in my job and somehow find a way to legitimately earn that surplus income of 228.3105 pesos per hour. Weirder things have happened so perhaps God will show me a way by which I will earn that. Right now, it’s a mystery. An interesting mystery, yet a mystery nevertheless.

So I also conclude that my Financial Advisor Sasha So Seng Yu was correct in steering me towards mutual funds and advising me to get into the Equity Fund at this point in time. This way I optimize the potential of my investment to earn the maximum amount possible, given the time I have to live. However, I still need to figure out what I’d have to do in my job to be qualified to earn more, given my talents and skills at the moment. Perhaps in time it will become clear to me what I’d have to do, even if right now I have no good ideas yet cropping up in my head.