Contentment is being satisfied with what you have

Contentment is not getting what you have but being satisfied with what you have

Do you own a laptop? I have one and uses it to write on this blog and that laptop has story about contentment.

You see, when i started taking up my MBA studies, i realized that i will need to own one. My company issued me a laptop but i felt that bringing it at school will not be a good idea so i planned on purchasing my own. My criteria was simple. I need a laptop that has a word processor and powerpoint program. I googled and browsed laptops and i end up owning a macbook. I know that purchase was not well thought of. I was in Las Vegas at that time and tax rates were cheaper compared to California. I bought one for the mere reason of tax savings forgetting that my main consideration was the word processor and powerpoint program.

The story did not end there but rather begins from that purchase. You know how more expensive macbook is compared to other laptops. So along with the expensive laptop, my desire to purchase accessories followed suit. I bought a keyboard protector and a screenshield. My reasoning was since i bought an expensive laptop i might as well protect it. After buying the keyboard protector and screenshield, i realized i will need a laptop bag. So i bought one. Then when i used my macbook, i realized how good the pictures organizing program and i thought i would need a camera so that i can take pictures and maximize the laptop.  Then one day, i realized i have bought too much to fulfill a single need: to have a word processor and powerpoint program.

The lesson is most often we have this want and to justify the purchase, we add our needs to this want. We add our wants to our needs to justify and make it appear that we are making a wise decision. We are never contented to what we have. Most of the time, we want this thing that we think of this thing too much. So much that it has become an internal struggle whether to purchase that item or not. Then the rationalization comes in saying that we need to purchase that item because we have been working so hard and we need to reward ourselves. Then once we get that item, we get tired. Yes, we'll be happy and satisfied days or weeks after the purchase but soon after we'll have another want to satisfy. The cycle never ends unless we decide to.

Looking back, i still have the macbook but have stopped deciding over this macbook. I no longer buy accessories. I've made a firm decision that i'll focus on my need and not on my wants. I try to observe the life of less crap less stress. If you are interested you might read this post about minimalism

Share Buy Back

Share Buy Back means the company is purchasing its own stock thus reducing the number of outstanding shares in the market. Reducing the outstanding shares results to higher earnings per share because earnings per share is computed by dividing net income over the number of shares outstanding.

What does this mean for the investors? Share buy back is a signaling technique by companies. This sends a message "our shares are worth more than the market values it".  Why? Because, if you take a look at it, the company is spending investor's money to purchase shares in the market. And before the company can do this, this has to be approved by the board of directors. Just to make it short, share buy back are authorized by current investors because they believe that the company is worth more than what the stocks are currently selling thus they are willing to buy it now while it is cheaper.

This has the same impact when CEO/CFO or any other top executive deals with the company stocks. If the CEO pitches to the investors how good the company is then you'll see in the SEC report that the CEO is dumping stocks then you'll have a second thought. The CEO must know something that's why he's unloading himself of the stocks. Because if not, why will he unload himself of the stocks if he knew the company will perform.

On the other hand, if CEO buys stocks in the market, this sends a signal to the public how confident the CEO is about the future performance of the company.

Winning is not a sometime thing; it's an all time thing. You don't win once in a while, you don't do things right once in a while you do them right all the time. Winning is a habit. - Vince Lombardi

3 Reasons to Start an Emergency Fund Before Saving for Retirement

From Yahoo Finance: Phil Taylor

Phil Taylor, On Monday October 25, 2010, 10:38 am ED

We talk a lot about saving for retirement and rightfully so. But many people get started with retirement savings without establishing a baseline of financial security for themselves: an emergency fund. A sound financial practice is to have 3 to 6 month's worth of living expenses in an easily accessible account to help you in case of an emergency. Here are three reasons to set up an emergency fund prior to investing for retirement.


1. You'll be ready when life happens. There are certain situations in life that require a larger amount of cash than the typical monthly budget allows, such as job loss, a major car or home repair, or a large out-of-pocket medical expense. As a way to self-insure for these instances, you need enough cash on hand to get you through the tough time.

2. You won't have to rely on credit. As we've seen during the recent credit crunch and housing crash, credit isn't always going to be available to tap for emergencies. It's better to have cash on hand. And even if you do have the credit, resorting to credit cards during a crisis could do even more harm. If you can't afford to pay off the balance by the end of the month, then you'll be forced to carry a balance and incur ridiculous interest charges. Plus, you might come close to maxing out your credit card limit, which could negatively affect your credit score. An emergency fund helps you avoid this situation all together.


3. You won't have to dip into retirement accounts. If you have the cash on hand, you won't need to dip into or borrow from the retirement savings you already have. Your retirement accounts are meant for your retirement. Pulling money from these accounts early to fund an emergency has several negative consequences. You'll be forced to realize any gain or loss that you're currently experiencing. If the market is down, you'll be pulling money out of the market at a bad time. When the market rises again, you'll miss those gains because you pulled the money out. If the retirement account was funded with tax-deferred dollars (as traditional 401(k)s and IRAs are), you will be required to pay taxes on that money. This can mean a big cash outlay right at the time you need every penny you can get. And you might even face a 10 percent early withdrawal penalty from the IRS if you can't prove that this withdrawal is for a qualifying hardship. Who wants to pay a penalty when they are scraping up dollars to fund an emergency situation?


Setting up an emergency fund is easy. Open a simple savings account. I like using an online savings account because they help you keep the funds separate from your other accounts and they even pay you a small percentage of interest on your balance. The typical advice is to have around 3 to 6 month's worth of expenses in a savings account. If you're more conservative or work in an unstable field, aim for more than that. Start saving every extra dollar you get into that fund until it's built up. Then you can switch back to worrying about retirement savings, knowing that your short-term needs will be met.

Be in Charge of Your Life and Your Goals

Not Making A Decision is a Decision

I heard this from one of my sales management professor. During that time, the class is deciding when to hold the next class session. He asked those interested to choose Friday to raise their hands and counted the number of hands raised. He then asked those who wanted to have it on Saturday and counted them again. As we were only given to either choose Friday or Saturday, he was surprised that his tally did not equal to the number of students. There are those who chose not to select Friday or Saturday thus his quote.


If we look at it, there's a big truth to his statement. We are the only one is responsible for our actions. No one else.
Those who were given a choice and did not respond allowed others to decide for them and unfortunately these people will choose what is beneficial for them and not what is beneficial to those who did not raise their hands.


I've read in one of the Sid Savara's blog

I am 100% responsible for my actions

* I am 100% responsible for my inaction
* I am 100% responsible for my distraction
* I am 100% responsible for my reactions
* I am 100% responsible for my proaction

Now, knowing that we are responsible for our actions and inactions, we should make a conscious efforts to act towards our goals. This means that whatever it is that you are going through today and if you think life sucks, change your mindset. Be responsible.

If Life throws you a lemon, you are given a choice. You can either do nothing or you can sulk and whine how miserable your life is or DO SOMETHING ABOUT IT and make a lemonade.

What do you think?

You Are The Something You’ve Been Waiting For (from SidSavara.com by Sid Savara)

"One of the illusions of life is that the present hour is not the critical, decisive hour.
Write it on your heart that every day is the best day in the year. 
No man has learned anything rightly, until he knows that every day is Doomsday."
– Ralph Waldo Emerson

For the article click here 

Of Aircons and Jackets

Don't think you're on the right road just because it's a well-beaten path.  ~Author Unknown

Our daily lives are guided by the majority because it is so easy to conform to the public.

Let me tell you a story. 

The climate here in the Philippines is humid and most offices rely on airconditioners to make workplaces cool. As it is humid, most people feel hot and tired from the commute so the first thing that they want once they got inside the office is turn the air conditioner on in full blast. In our office, people working on the day shift start coming in at 7am until 9am. And as people come in, they usually turn on the airconditioners in full blast to make the work area coller faster. This is of benefit especially for people who are just coming in from the hot temperature outside.

This system posts a problem, however, to the early people who come in. Imagine, you are one of those who arrived at 7am. By 8am or 7:30 am, your body would have adjusted to the cool room temperature and will be chilly by that time. But for those who are still coming in from 8am to 9am, they still feel that hot temperature. So what do people do? They start wearing jackets.

By lunch time, most of the table's conversation revolves around how cold it is in the work area and how hot it is in the pantry. The reason was because when people come into the office, it is so hot outside and they want to feel comfortable once they get inside the office. So most people will turn the aircon full blast. On the other hand, people only go to the pantry during lunch. and most often, they are so cold from the full blast aircon, they won't turn on the airconditioner in the pantry. Once the pantry becomes filled up, the room becomes warm and people start comparing the temperature in the work area with the temperature in the pantry.

What's weird though is that most people will just share what they feel instead of acting on it. Nobody turns off the aircon in the work area and nobody turns on the aircon in the pantry. It is so easy to complain rather than act on it.

I tried to determine why people don't turn off the aircon in the work area. My best guess was they don't want to be the person to do it in fear that someone will complain about turning it off. Weird as it may sound but my guess was this is part of our culture as Filipinos. We never want to offend the other party. We are that hospitable. In fact, we are not even sure that we will offend the other person but for the sake of not offending anyone, we just bear the inconvenience ourselves. Is this good or bad? I don't know. I'm sure that there are instances that this culture of us works best.

The very nature of leadership is that you’re not doing what’s been done before. If you were, you’d be following, not leading” Seth Godin, The Tribes

The Biggest Money Mistakes Couples Make by Kimberly Palmer

 
Managing your own money is hard enough; add another person to the equation and it becomes an obstacle course: Does it make sense to combine bank accounts after moving in together? Should you pay off your credit card debt before getting married? Does the higher earner need to cover more of the bills?


 
Here are six common mistakes that couples make with their money--and how to avoid them, adapted from the new book Generation Earn: The Young Professional's Guide to Spending, Investing, and Giving Back.


 
Not talking about finances.


 
Sure, discussing who pays for what and how much debt each person brings into the relationship is awkward--but also necessary. Before moving in together, talk about how you plan to share household expenses, whether the person with the higher salary will contribute more, how much credit card debt you have, and how you plan to share big-ticket items like cars. Also, take time to map out the logistics: Will you pay bills out of one shared bank account? Or keep all your money separate?


 
Don't forget to bring up your long-term goals, too, which can make the discussion a little more romantic. Do you want to swim with dolphins in the Bahamas? Or backpack around Europe together? Agreeing on common goals makes it easier to save.


 
Combining accounts too early.


 
Putting all your money into one account might be the more romantic option (and prevent any debate over who picks up the tab at dinner), but it can also cause major problems in the event of a breakup. Couples who live together without first walking down the aisle face financial vulnerabilities with joint accounts that married couples don't.


 
Investments in shared assets, such as a home or car, can be lost during a messy breakup if only one person's name is on the title. Money or labor that went into redoing a former partner's kitchen may never be recouped. And while details vary by state, even assets such as joint savings accounts can go to the person who is first to make the withdrawal. Legalities aside, a lot of couples say they like the independence of having two accounts anyway, at least before they decide they've found their permanent soul mate.


 

 
Sharing credit cards, real estate, and other types of debt.


 
If you add your partner's name to the title of your home, then they own it, too--even if you paid for the down payment and mortgage. "I see it happening too often--a couple gets together, says 'I love you, let's set up house and make this official'. . . and then [one person] signs away half of their equity," says Sheryl Garrett, a certified financial planner based in Shawnee Mission, Kansas, and author of Money Without Matrimony. Couples also need to talk about who would get the first opportunity to purchase the house if they were to break up, at what price would they sell it, and how many days they would have to refinance the mortgage in their own name.


 
Signing on to someone's car loan or credit card can create similar problems. If you break-up and the other person fails to make their payments, then you're on the hook, too. Even if you've long gotten over the relationship, your credit might feel the after-effects for years.


 
Getting surprised by the marriage penalty.


 
Newlyweds who earn similar, high salaries often get an unwelcome surprise the year after they get married: They find themselves stuck with a mega-tax bill. That's because the so-called marriage penalty still exists in the upper tax brackets. In 2010, for example, husbands and wives who each earn $68,650 and up in taxable income are at risk for paying more married than they did as singletons.


 
Earnings above that amount face a 28 percent tax, compared to 25 percent pre-marriage. Couples are most at risk when they bring home similar incomes. (The reverse is also true. When one person in the marriage brings home all or most of the money in a marriage, that couple usually gets a tax break.) The best way to prepare for this unwelcome wedding "gift" is to know it's coming and to deduct more from your salary throughout the year to avoid a large bill on April 15.


 
Ignoring the risk of a break-up.


 
Talking about how you would split things up if you decided to go your separate ways can prevent bad surprises later. Unless children or major assets are involved, there's usually no need to hire a lawyer. In fact, you can just write down the answers to these questions along with any others that apply: Who would stay in the apartment? Who would get the cats? The car? If you want to formalize the process, you can pay a nominal fee to download forms, such as a living-together guide and contract, at nolo.com.


 
Since unmarried couples don't get to argue their case in divorce court, it could be your only protection in place if things go south. (The legal ramifications of common-law marriages, civil unions, and domestic partnerships vary by state.) Couples might also want to consider talking about any debts, past bankruptcy filings, and credit report problems, because even if you're not legally liable for your girlfriend's $50,000 student loan, it could end up affecting your quality of life if 10 percent of the household income goes toward paying it off each month.


 
Putting one person in charge of money.


 
It's normal to specialize in relationships--to delegate dinner planning to the best cook, and gardening to the one with a green thumb. But giving one person all of the money management responsibility can lead to an unbalanced relationship.


 
New York-based relationship therapist Bonnie Eaker Weil explains that no one should ever feel like he or she has to ask permission before buying something. "I call it 'Mother, may I?' You don't want to get into that position where you're the little girl, or you're the little boy, and the other person is your parents. You want to have your own money, and certain things are guilt-free, and you just do what you want with it. If you want to buy a latte, or lipstick, or a facial, you do not have to ask permission, because it's your own money," says Weil. Plus, in the event of a break-up, you want to make sure you know where all your money is and how to manage it.


 
This article is adapted with permission from Kimberly Palmer's new book Generation Earn: The Young Professional's Guide to Spending, Investing, and Giving Back (Ten Speed Press).

Peso Cost Averaging

Peso Cost Averaging is a personal wealth-building strategy that involves investing a fixed amount of money at regular intervals over a long period.

How Does Peso Cost Averaging Works?

This strategy is designed to reduce market risk by stretching out the purchase of stocks over time, buying more when prices are low and buying less when it is high, effectively keeping your average cost low.

Peso Cost Averaging - Illustration

In the above illustration, the investor purchases Php5,000 worth of ABC's stock whatever the price maybe. The table above shows that when prices are high (P11.75) less shares are bought (426) but when prices are low (7.5) more shares are bought (667).

This strategy brings down the average cost per share. This strategy works because it is said that value of stocks tend to increase overtime. The key strategy is to keep on purchasing regularly even if prices are going down or going up.

If you want to learn more please watch this video. For the EIP Presentation click here 

(From: Citiseconline.com)

(Note: I am not affiliated with Citiseconline or getting paid to promote their services. I use them because i learned Peso Cost Averaging from them)

Dumbest Money Moves

From Yahoo! Finance "My 10 Dumbest Money Moves – And How You Can Avoid Them"
Not Having a Goal
The 3 most common goals that most of us will try to achieve are getting a car, buying a house and get married. In order to reach these 3 goals, money is one of the most important factors. Most of us are able to achieve all 3 goals in early age but it takes 10~30 years to pay out all the debts. For some people, getting a loan either purchasing a car or a house is necessary as this is the only way they know how to save money. It's very difficult to resist the temptation to spend money if we have lots of cash in hands.

Not having a spending plan
If you don't track how you spend, you won't realize how much you spend. At the end of the month you'll spend more that you expected and you won't know where and how you spend it. Keeping a record of how you spend your money can cut down all the unnecessary spending and create a healthy way of using money without exceeding your budget.

Attempting to derive self-esteem from possessions
The question of either looks rich or be rich. That's a really good question. What will you choose? I think it is easy to look rich than actually being rich. Everybody have the chance to look rich. The question is how long can it last. We can have the house, the car and anything we need by just taking up loans. We can choose to work for the rest of our life to pay for the loans or we can choose not to have all the things we want so soon. Taking one step slower without having to take up so many loans can make life easier. Most important of all it will cost you lesser if you reduce the loans.

Doing what everyone else is doing
This is actually very simple but still most people choose to do what everyone else is doing. I suppose people think it's safer to do what everybody else is doing. It might be safer but most likely it won't make much money. The only way to make money is to do what everybody else is not doing. The one place that proves this theory over and over again is the stock market. But still most people are still doing what everyone else is doing.

Starting to save large and later rather than small and soon
Honestly I have this question in mind since I was in high school. I know that we should practice saving but the question is save large and later or small and soon. I got my answer after almost 20 years. I rather use the money for investment and building my money making opportunities than for saving.

Paying interest to buy things that drop in value
This is the two golden rules that we should follow. First is when the purchases go up in value at a rate greater than the rate of interest you're paying to finance. Second is when you can earn more on your cash that you're paying in interest. I suppose that is why we are always advice to purchase a house rather than a car.

Turning down free money
This only applies to US citizens regarding company's 401k and retirement plan. Employees should participate to get the full match offered by employer in company's 40ik or other retirement plan. All the allowance, benefits, insurance and medical given to employee by the company are money not in cash. Those are your money unless you claim them.

Buying a new car
I always see a car as a transport and nothing more. Everybody knows the value of a car drops instantly once it's on the road, and the value keeps on dropping over time. There is actually no need for a fancy or new car unless you're not planning to get most of the money back.

Buying more house than you need or can afford
Unless you're into real estate investment, there is actually not need to buy a big house or lots of houses. In my previous post which I introduced Yahoo articles related to billionaires, most of them actually live in a regular normal size house for years. They have the money but still they don't switch to big houses. Living in a big house eventually increases other expenses like housekeeping, electric bill, water bill, security and many more.

Not protecting your good credit
There is only one thing that I can think of when it comes to protecting a good credit. I suppose I need a good credit to borrow money, taking up loans and work on other financial related issue. A good credit record will makes things easy.
Review your spending habits and see if you are making one of the ten dumbest moves. If you are, this is the time to stop the habit!

Investing in the Stock Market Part III

If you haven't read the Part I click here and Part II here


 
How to choose your stock broker?

I have only tried online stock trading and have used both BPI Trade and Citiseconline. Below are my experience in using the online facility of the said stockbroker.


 
BPI Trade

BPITrade is an Internet Investment web site which offers the following: (1) online, real-time stock trading with the Philippine Stock Exchange (PSE) through BPI Securities Corporation; (2) fixed income investments through BPI Capital Corporation.

With BPITrade, you have access to real-time market information, online order placement, portfolio management and research as well as a unique capability of diversifying your investments over a wide array of products at a click of a button.

BPI Securities Corporation is a wholly-owned subsidiary of BPI Capital Corporation, the investment house which, in turn, is wholly-owned by the Bank of the Philippine Islands. The Bank of the Philippine Islands, founded in 1851, is one of the country's largest commercial banks.

The fact that it is affiliated with one of the largest bank in the Philippines makes it a plus


 
Minimum Investment Required

There's no minimum investment required to open a BPI Trade Account. However, they require that you maintain a savings or current account with the Bank of the Philippine Islands, BPI Family Savings Bank, or BPI Direct Savings Bank.

Once you have your BPI Trade Account, you need to fund it so you can buy and sell stocks online.

The plus side here is that any cash you have with your BPI Trade earns interest so even if you are not invested in stocks, you still earn. (The interest rate is low same with savings deposit so you are better invested than to have an idle cash)


 
Online Facility

The website offer off-hours order setting. This means that you can place order to sell or order to buy stocks even if the market is closed. The trading hours of the Philippine Stock Exchange (PSE) are from 9:30:00 AM to 12:00:00 PM, Manila time (GMT +8), Monday to Friday so if you don't have time to trade during these hours, the offline order is a good point for you. You can set your orders during the night.

Funding the Account

To fund the account, you just deposit at any BPI Bank. You can also enroll your account in BPI Express Online then just transfer funds from your other savings or checking account.

Clearing of Funds

Cash proceeds from the sale of stocks will be credited to your BPITrade Bank Account only on settlement date, which is T+3 (three business days after the transaction date) and thus, will not be immediately available for reinvestment. Lastly, cash proceeds from the sale of fixed income securities will be available on T+2. This is a bit of downside since other stockbroker allows you to immediately used the funds from sales transaction to buy new stocks.

Withdrawing Funds

To withdraw cash from your account, just make an online request in the bpitrade website and it will be credited to your nominated BPI savings account


 

 
CitisecOnline

CitisecOnline was established in 1999 with the vision of allowing a low-cost and easily accessible means to invest in the Philippine Stock Market. Over the years, it has developed a full sweep of services to empower the retail investor. These include real-time quotes, research services and reports, as well as expert-broker support, by providing him the tools to assist him make intelligent decisions. It also allows real-time execution of trades, which is the best practice in the local online trading industry. With its experience in servicing experienced investors looking for more convenient ways of stock trading, CitisecOnline is well-poised to drive the development of the online trading investor market in confluence with the increased penetration of internet access, broadband services and increasingly tech-savvy investing public.

It is publicly listed company.


 
Minimum Investment Required

For EIP and Starter (student) accounts, the minimum deposit is Php5,000.

For regular COL trading accounts, the minimum deposit is Php25,000


 
Online Facility

The website also offers off-hours order setting. This means that you can place order to sell or order to buy stocks even if the market is closed. The trading hours of the Philippine Stock Exchange (PSE) are from 9:30:00 AM to 12:00:00 PM, Manila time (GMT +8), Monday to Friday so if you don't have time to trade during these hours, the offline order is a good point for you. You can set your orders during the night.

Another plus of Citiseconline is that they offer Good Until Cancelled Order (GTC). The CitisecOnline Good-Till-Cancel order allows the user to enter an order to buy or sell which will stay valid for 7-days or until the order is fully matched, cancelled, rejected, or no longer has sufficient funds or stocks. Any unfilled Limit GTC Orders will be stored in an order queue at the end of the day and will get sent to the Exchange during market pre-open of the next trading session. This is a good tool because you don't have to set another order it was not matched during the day. With regular off-hours order, once the stock market trading for the day has been completed, the order is automatically cancelled requiring you to make another one.

Funding the Account

You can deposit at any BDO or BPI account. Merchant Payment facility is also available through BPI expressonline and BDO Online Banking.

Clearing of Funds

You can use the proceeds to immediately buy another stock or even the same stock if you wish. There is no need for you to wait three days for clearing. However if you wish to withdraw the funds, you must wait three days after you sell to avail of its proceeds.

Withdrawing from your Account

You have to fill up a form, fax it to Citisec and call. They will deposit the amount to your nominated account.

Investing in the Stock Market Part II

If you haven't read the first part click here


 
When should I start investing in the Stock Market?

Time is your most precious asset. Those who start investing sooner rather than later have a tremendous advantage.

When it comes to investing in the stock market, time is your most precious asset. The longer your time horizon is, the more time you have to make your money grow.

Compounding is in fact, the single most important reason for you to start investing right now in the stock market. It is the multiplier effect that occurs when earnings or dividends on your investments begin to generate their own earnings.

Every day you are invested is a day that your money is working for you. Investing helps you ensure a financially secure and stable future.

How much of my savings should I invest in the stock market?

With a starting investment of Php5,000 you can already begin investing in the stock market.

To determine how much you can afford to invest, you need to determine your financial net worth (what you own minus what you owe.)

A portion of your funds should be in short-term liquid investments, such as bank savings, time deposits, and Treasury bills, to cover living expenses, and any possible emergencies. The amount to keep will vary according to your individual lifestyle. A practical rule of thumb is to keep at least 6 to 12 months' worth of living expenses in short-term liquid investments. The remainder of your savings can be invested in medium or long-term instruments such as bonds, stocks or both, depending on the time horizon of your financial goals.

A more conservative approach is to keep at least 75% of your savings in short to medium-term fixed income instruments. The balance of 25% can be set aside for your investment in the stock market.

In fact, for as low as Php5,000, you can already begin investing in the stock market.

How do I start investing in the Stock Market?

Getting started in the stock market is a simple process.

1. Chooses your stockbroker or trading participant
   
2. Open a stockbrokerage account
   
3. Place your buy or sell order either online or by making a phone call to your stockbroker
   
4. Monitor and keep track of your investments 

Resistance

I'm on vacation right now and while sitting on a beautiful beach watching the waves roll in, I was reminded of rip currents and the approach you take to escape them.  Therein lies an important lesson that can be generally applied to much of our lives.

The worst thing you can do is to fight the rip current by swimming against it.  You will quickly become exhausted and in danger of drowning.  The way to escape a rip current is very simple: you calmly swim parallel to the shore (perpendicular to the current) until you are out of it.  With a fraction of the energy needed to swim against the current and almost certain failure, you can swim away from the current and live.

Resistance and struggle against that which opposes you or that which you don't like is very often the worst thing you can do.  Just like the rip current, you should generally step aside and just watch whatever is bothering you roll on by.

Instead
of wasting your energy on the negative, you can focus it on the positive and with far less effort achieve far greater results.  Certainly there are some things you should resist and there are things I will and do resist.  But I chose my battles very carefully now and they are becoming increasingly rare.

I'm convinced that most of what we resist accomplishes little more than making us miserable and sometimes amplifies the problem rather than diminishing it.  Resisting the nutjob in Florida planning to burn the Koran, increased his audience from about 50 people to hundreds of millions.

I spent decades of my life resisting almost everything I didn't like and it was an enormous mistake.  My youthful idealism and cockiness led me to believe I might be able to change something or convince somebody they were doing it wrong.  I ended up frustrated and stressed.  I learned years ago to let go of many of the big things, but for some reason I thought I could still resist the small.  It's only in the last few years I've begun to stop resisting those small things as well.  I've found they grow even smaller as a result.

When you resist something you immediately make it a much bigger deal in your own life than it would otherwise have been.  Whether it's the government, toxic people, traffic, bureaucracy, the media, the masses, the neighbors, unpleasant tasks, poor design, inconsiderate bozos, or or anything else, do your best to step to the side and ignore it.  Let the currents rip by you without allowing them to suck your precious life out of you.  You need to conserve your energy in order to progress your agenda.  Sometimes this is easy and sometimes it is difficult, but in most cases you will be better off.  I suggest you seriously consider it.

I have a long way to go, but I'm getting much better at not resisting that which I don't like.  As a result, I've discovered a much better way to live and that same way is available to anyone who is willing to give it a chance.  Stop resisting life.

From "The Rat Race Trap by Stephen Mills" - http://bit.ly/dwQpB2

Investing in the Philippine Stock Market

I've been into stock market since 2006. It is a good way to grow money and help Philippine businesses as well. Though I am not a consistent gainer, my gains are still way higher than my losses. Below are selected stock transactions from August to December 2009. In spite of the losses, you'll see that returns are still higher compared with savings deposit.

 In the next few days, I'll be posting information related to investing in the stock market. See information below

  
Why Invest?

There are many reasons why you should invest your money. Investments are made to generate future purchasing power that will keep ahead of inflation and provide investors a sense of financial security. You can achieve your financial goals for your different financial needs over different time horizons like buying a house, paying for your child's college education, and setting aside for your own retirement.

The first and best way to start investing is by saving money. Always pay yourself first. Every time you receive your salary or profits from your business, set aside or keep some of that money, and invest it or put it in a bank. Rather than wait for the end of the month to see what is left for savings, at the beginning of the month, write a check to your investment account.

You should start a monthly savings plan so you can have your income work hard for you. Over time, small amount of savings become substantial.

Investing is the ability to make your savings grow or appreciate to achieve your long term financial goals. Investing is the most effective way to build your personal wealth and secure your financial future

Why invest in the Stock Market?

History has proven that investing in stocks over the long term provides greater returns and protection against inflation than other fixed income instruments such as savings accounts, time deposits, government securities and bonds.

What are Stocks?

Stocks are shares of ownership in a corporation. When you buy stocks of a publicly listed company, you become a stockholder or shareholder of a company. In other words, you become part-owner of that company. As an owner, you participate in that company's growth and future profits. Conversely, you may also lose if the company suffers a loss or performs below market expectations.

What is the Stock Market?

A stock market is a place where stocks are bought and sold. The Philippine stock market is the place where people can invest in "publicly listed" companies in the Philippine Stock Exchange (PSE).

How do I make my money grow in the Stock Market?

Through capital appreciation or when there is an increase in the market price of your stock and through dividends issued by the company you invested in"

There are two ways to make your money grow in the stock market:

1. Through an increase in stock price or capital appreciation

Capital appreciation is an increase in the market price of your stock. It is the difference between the amount you paid when buying shares and the current market price of the stock. However, if the company doesn't perform as expected, the stock's price may go down below your purchase price. For example, if you buy a share of stock at Php100.00 and it rises to Php110.00, your capital appreciation or gain is Php10.00. Keep in mind, though, that you only realize your gain of Php10.00, if you sell at Php110.00. If you choose to hold it and it further increases to Php150.00, your capital gain would be Php50.00. However, if your stock decreases to Php100.00 then sell it at that price, your capital gain is zero.

2. Through dividends declared by the company


Dividends are paid out to shareholders, representing earnings of the company that is not going to be reinvested in their business. There are two types of dividends that can be given by companies cash and stock dividends.

Cash dividend is the earnings for every share of stock declared by the company. So, if the company declares a dividend of 25 centavos per share, a stockholder with 10,000 shares will receive a cash dividend of Php2,500.00 gross of tax (Php0.25 x 10,000) in cash.

Stock dividends are additional shares given to shareholders at no cost. If the company declares a 25 percent stock divident, a stockholder with 10,000 shares will be entitled to additional 2,500 shares of stock. These shares can also be sold anytime after the shares have been issued.

From Philippine Stock Exchange Primer 2010

The more you learn...the more you earn" - Brad Sugars

“Just make up your mind at the very outset that your work is going to stand for quality... that you are going to stamp a superior quality upon everything that goes out of your hands, that whatever you do shall bear the hallmark of excellence.”,,- Orison Swett Marden

Calculate Your Philippine Income Withholding Tax

Hello!

Thank you for visiting my site! I know you are very much interested in learning how to compute for your withholding tax. You are very much concerned about where you money goes especially with the taxes. Why don't you take the next step and read how to manage your finances here

Going back to your withholding taxes. There are two reasons why you should learn how to compute for your withholding tax yourself

One, you doubt the accuracy of your payroll in computing the withholding tax thus for your peace of mind you might want to recheck it yourself. (Yes! It is doable and very easy. Do not be scared of the math)

Secondly, would it not be cool to just know how? I mean. If you go around and ask your co-workers, most likely majority are just looking at the amount under the withholding tax. No one knows how to compute except for the payroll guys. Not fair and this post will help you do that.

Steps in Calculating the Withholding Ta

1. How often do you receive your salary? Do you get it weekly? Monthly? Or just like everyone else who receives it twice a month? It is important to know because the Bureau of Internal Revenue (that’s BIR) has different tables depending on the frequency of you getting your pay. You know. Different strokes for different folks.

2. Review your payslip and look for allowable deductions. These are the government mandated deductions such as SSS, PAG-IBIG (or HDMF) and Philhealth or (PHIC). Note: At this point, we are only talking about mandatory deductions. If you have loans from these institutions, deductions for loan payments should be set aside for now. Just look for the mandated deductions. When I say mandated deductions, these are the deductions you see payroll in and payroll out even if you do not have loans.

3.  Know your tax exemptions status. See list for quick reference

S/ME       Single or Married with no qualified dependent
ME1/S1   Single or Married with one qualified dependent
ME2/S2   Single or Married with two qualified dependent
ME3/S3   Single or Married with three qualified dependent
ME4/S4   Single or Married with four qualified dependent

Are you ready? Get your payslips ready and we are now ready to compute for your withholding tax table.

Step One: Look for your taxable income. You are lucky if your payslip shows a line that says taxable income. Just take note of that and we will use it in the tax table. If you don’t have that line, your taxable income will be your gross salary plus overtime pay plus holiday pay plus night differential plus allowances (other than rice and clothing) minus tardiness deduction minus the government mandated deductions. Still with me?

Let’s take a sample payslip for a single person with no dependents

With the example, we get the taxable income by getting the basic salary less all the deductions. (Reminder again, if you have loans, these should not be deducted for the purpose of computing your income tax). If you are still with me, you should get the amount of P5,771.75


Then we look at the BIR’s withholding tax table for semi-monthly payroll. We look at row 2. S/ME since the person is single with no dependent. In case you are married with three dependents, then you have to use row 3. ME3/S3.

Going back to row 2.S/ME we look where the amount of P5,771.75 falls under. It should be the column where the computed taxable income is higher but not above the next column. In our example, we will select column 5 since P5,771.75 is above P5,000 but below P7,917 under column 6. Still with me? Now, go look for your taxable income and identify under what column it falls into.

Now the fun part. See that the rows saying exemption and status? Those are the numbers needed to compute for your withholding tax.

Continuing with our example, the exemption amount under column 5 is P354.17. Set it aside and do the next step. Deduct P5000 from P5,771.75. Where did we get the P5,000? That’s the intersection of the column and the row. (With our married person with three dependents scenario with P7,000 taxable income, the amount is P6,458. The intersection of the row and column 4)

Now we are left with P771.75 (That’s P5,771.75 less P5,000). We multiply that amount with 20%. Where did I get that 20%? It is right under the P354.17.(With our married person example, we should get 15%. Hope you are still with me)

20% of P354.17 is P154.35. We add the amount to the P354.17 earlier and we get the withholding tax of P508.52

Now, do it and let me know if you got your withholding tax correct. If you need help, comment below and will try to assist. 

Knowing What You Want

Ask anyone if they want a million and you'll sure get a positive response. Everyone wants a million or billion if possible. Then ask what will you do with your million? Set of responses that you'll get will include buying a new house, car, paying off debts, saving it in the bank or starting up a business. The list will go on and on. Dig down a little deeper by asking what kind of business, what kind of house, where will it be located and the response will be slower this time.

It is really easy to say great big things. Everyone wants to get that big goal but not everyone is prepared to really have it. No one has a definite plan of what to do once they get that goal. Not all are prepared to know what to do. 

I read yesterday a blog about a baby crying at 3am. For all parents out there, i'm sure you have experienced this. It is a bit challenge to pacify a baby who constantly cries and have difficulties in communicating what he wants. It is said if you really want something, you must be clear on what you really want. Everything ready to be given to you. We must just be clear as to what we want. In other books that i've read, they said you must be able to clearly see what you want in life. See it in vivid detail as if you already have what you want. It will be the bridge that will lead you in getting what you want in life.

From Evernote:

More Money Making Tips Clipped from: http://www.toasteggme.com/index.php/money-making-talk-etc/more-tips-to-keep-the-money-you-make/

It is said that regardless of how much money you make if you cannot keep the money, than you might not have any money at the end. A lot of millionaires actually did not make a lot of money but they sure know how to keep the money they make. Here's an article from Yahoo Finance title "Stretch Your Paycheck" introduces some tips and guides to keep you keep the money you make and perhaps can help you become a millionaire.

Trim your grocery bill. This is the part where almost every family lost their count of money when it comes to grocery. It is better to set a maximum budget for grocery before heading to the stores. One of the most important things that we need to do is always keep track of our purchase. I always treat it the same as my online business. Either it is grocery or business, over spending is the same as losing money. Another simple way to reduce the expenditure is by using coupons. Honestly I think most people know the existence of coupons but just that most of us are either lazy or too troublesome to use them.

Cut your cell phone bill. This is the part which I mostly over pay for the cell phone bills. In order to cut down the cell phone bill we need to actually take a good look in the plans offered. There are lots of features that we normally don't use or not needed. In fact it will be best to go for prepaid plan if you're not using cell phone that much.

Boost your deductibles. Auto and home insurance always have the space which you can reduce your total payment. In most cases if you're able to increase your monthly payment, you might get a discount.

Switch your TV package. If you have a long working hour job, it's unlikely that you'll spend lots of time in front of the TV. It's better to just cut the cables or satellite TV packages. In fact I think you can get almost everything the same from an online computer.

Rein in your eating out. My mom always tells me that "It's better to cook your own food than dinning outside as you'll save money and it's much healthier." Let us just take a look at how much we spend eating outside. If you actually calculate the money that you spend for the food, coffee and snacks, it can cost as at least quarter of your pay. Make a comparison between cooking for your own food and eating outside. You might be surprise of the amount of money that you can save.

Get rid of your stuff. If you're not using them, sell it. A lot of stuff will be useless or outdated if you keep them for years. It will be better to sell the stuff when there are still some values on them. At least trade it for the money for now. Purchase them if you ever need to use them again. This way you won't be keeping lots of old junk.

Refinance your mortgage. This is the most troublesome method but if you do it right the reward is great. Always consult an expert before taking any action. Careful calculation can help you save few hundred dollars a month.

Unload your second car. If you have a car and you're not using it much, sell it. Car is the one asset that values decreases over time. Besides you need to pay for the maintenance and insurance. Also if you don't drive the car for a long period of time, it can break down easily.

Some of the above actions are just a cut down of the things that you might not needed. Some of the stuff you can get just the same with a lower price if you know where and how. All you need to do is little bit of research and you'll save hundreds of dollars a month. I suppose we call this the smart way to spend money.