Moneywise

My husband Anthony has a new show on RPN-9 called Moneytalk. Every Saturday, the show teaches people how to use their money wisely, and make their money work for them. Since he has partnered with finance experts Topax Colayco, author of Pera Mo, Palaguin Mo!, and Andy Fereria, dean of the Asian Center for Entrepreneurship at AIM, I have had the privilege of learning from experts what it means to make my money grow and the rewards it can give. It has helped me a lot to be a better steward of the money being entrusted to us. Hope this helps you to be wiser in managing your funds!

Topax Colayco encourages people to make their money work for them. He says that the reason why so many people end up poor after working all their lives is they fail to pay themselves. They spend all their earnings paying bills, buying items they can’t afford and spending on their urgent needs. He says that in order to get out of the poverty rut, people must learn the following:

1) Pay yourself – people must learn to diligently set aside money for themselves so that in the event they are no longer able to work, they may rely on that money to take care of their future.

2) Be a passive earner – Colayco stresses the need to place the money being put aside in a high-yielding instrument such as mutual funds, treasury bills or stocks. It must be earning at least 8 percent per year because that would be above the inflation rate. Being a passive earner means you don’t have to work hard at making your money work. It earns without you even moving a finger. He’s not too keen on leaving one’s money in the bank because it earns very little interest. Money to be left in the bank should be kept at a minimum level and be spent on regular and emergency expenses. With a minimum investment of P5,000, you can start getting into mutual funds. Look for banks with very little required minimum maintaining balance to start up your savings account.

3) Be faithful – in what little you can afford to set aside. Colayco says that with compounding interest, we could have P11 million after 30 years if we all put aside P1,000 every month!

Wow, that’s a lot of money to retire with and give away.

4) Live within your means – you must learn to say no to friends and relatives who borrow or ask for money when you do not have that extra money to shell out.

5) Don’t be afraid to take risks – Topax says that his biggest weapons that helped him earn his success were his lakas ng loob and his wife’s support and attitude. She worked in a secure job while he strove to earn more income as an entrepreneur. Life was not easy for them in the beginning, but they didn’t give up when times were hard. They pursued their dream and became a success. Through the Colayco Foundation, Topax wants to liberate the Filipino people from poverty.

A truly wealthy person, according to Topax, is one who is able to live comfortably at the end of his lifetime and be able to give away all that he has acquired before he dies. After all, none of it can be taken to the afterlife. A person who was unable to set aside money for his old age will now rely on his children to help him get through life.

This is a vicious cycle that puts a great deal of burden on the children simply because of poor financial management. Instead of being a blessing to their children, many parents become a burden because they somehow believe that children should pay back their parents for all the hardships they had to go through for their sake.

By being wise with money, parents can live their lives without being a burden to their children. Their children will grow up to be good stewards of money and not be tied to working for their family or clan only but for a better future for themselves as well.

Next week, I will share with you what we can learn from Andy Fereria about the value of entrepreneurship. Filipinos have been raised to become employees. It’s about time that we use our God-given talents and resources as our own bosses and succeed!

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E-mail me your thoughts at mommytalk@businessworks.com.ph.