Are U a Spender or an investor?

[quantuminplus]

dakoa ana bro....3M man.... katong naay dako nga Investment.... happy gyud kaau.... in just 3-4 months ni profit gyud ug 250k plus.. ka nice ba.... wa pai labot sa kato pagpalit nga ni down ang navps.... so nice... hinay2x lang sa ta para makaabot ug first "M" nato.... anyways saver/investor naman ta... congrats bro enzo...

[quantuminplus]

FAMI = 3.8195 as of Today....

[quantuminplus]

This is an issue that many people have probably wrestled with at one point in time or another in their lives, probably during their 20’s and 30’s.

One side of the issue claims that since you work hard for your money, you should spend that money to enjoy your life. Travel the world, eat at all the nice restaurants, wear the best clothes, drive the nice cars, in short, live life to the fullest. Life should be enjoyed. You shouldn’t live like a miser. What if you die tomorrow? All that money you saved would’ve been no good and you would’ve never really got to experience life. And add to that, what good is money when you’re too old to do the things you want to do which you’re perfectly able to do when young?
Then you have the other side of the issue.

The other side claims that if you save and invest your money now rather then spend it on enjoying momentary pleasures, your financial future will be secure and you won’t have to worry about not having enough money for retirement. It’s better to have a fat bank account show you the miracle of compound interest rather than live life paycheck to paycheck. In short, it’s a tradeoff, but in the end it’s worth it.

Both sides of the issue argue good points, hence causing the dilemma that people often find themselves in. The ideal solution here would be to find the middle ground between the two sides, but the issue has seemingly been painted as black and white in people’s minds. It’s either or. You can’t have both. You’ve got to choose between the two.

Let’s explore the two sides and see what we find.
When people choose to spend their money to enjoy life now, it simply means they’re putting precedence on the present over their financial future. It doesn’t necessarily mean that they’re using ALL their money to enjoy the present – it’s just enjoyment of the present is where the money goes first and anything else can be potentially saved for the future. How that money is spent to enjoy the present will be different for each person. It might entail buying a nice big house instead of a starter house and buying a nice car along with that, expensive clothes, expensive trips and vacations, etc.
There’s nothing wrong with any of that stuff. There’s nothing wrong with that at all.
The only potential negative side to this is once you start to going down that path, it’s very hard get off of it. It’s hard to “downgrade” your lifestyle because you become so accustomed to your current one. Humans are creatures of habit and if this lifestyle keeps going on, it becomes harder and harder and harder to save for the future, which is something you must do eventually. You can’t escape it. And you never know when financial disaster may strike too. If you find your income shut off for whatever reason, all of a sudden it becomes really expensive to “maintain” your lifestyle and then the credit cards come to the rescue. By the time you get back on your feet financially, you find yourself in a hole you dug yourself into and you have to spend time and money to get out of it just to get back to your previous position.

People say life is short, but in reality, it’s long. It’s long and it becomes really long when you get old and find yourself not being able to survive with the money you have.
By spending your money to enjoy the present, it’s also costing you opportunities. Opportunities to start your own business, to invest for the future, or just to save for a rainy day to help when your income suddenly gets shut off. Now, let’s look at the other side. If you save and invest for the future, you incur opportunity costs as well. You can’t really “enjoy” life now. You have to sacrifice the present for the future. You can’t eat out at nice restaurants all the time, you can’t buy that new car you’ve always wanted, and you can’t buy that big house down the street.
But let’s stop for a second, because who’s to say that’s what enjoying life is all about?

It’s easy for the majority of people to fall into that mode of thinking because that pressure to enjoy life now comes from the fact that we’re bombarded with the message that it’s what we should be doing and the only way to do that is to do exactly what the people in the TV commercials do.

But what happens when you do get all that? When you do get all those things so you can “enjoy” life now?
You adapt.
You eventually adapt to that level of utility. It brings enjoyment for a little while, but it eventually subsides. The only way to get it back is to repeat the same actions you did before that caused you to experience that enjoyment, hence locking you into habit.
Think about it. Open up your closet door and look at the clothes you bought last year. They don’t seem all that appealing now to you do they?
Think of that car model that you thought looked really good when it first came out. Look at it again 2-3 years later. It doesn’t look all that great either does it?
That’s not to say you should completely avoid all these things. It’s just to say if that’s your #1 guideline you use to enjoy your life, you’re going to find that your life isn’t going to be very enjoyable and that enjoyment is going to wear off eventually and pretty quickly as well.
When you put the whole materialistic pursuit in its place, the more important things in life tend to become much clearer.

Purpose, self actualization, relationships, families, friends – these, along with many other aspects, are the things that make your life enjoyable.

You can enjoy life now in that respect without spending too much money so you can in turn, save and invest for the future.

It turns out you can have it both ways - it’s just that some people didn’t realize what enjoying life was truly all about.
When you live a simple life, it’s really easy to see what the more important things in life are. So long as you adequately take care of your basic needs – food, clothing, and shelter, your level of utility will not get that much higher when you spend money on trying to get a better “version” of your needs. They’ll go up, but eventually come back down to your original baseline after time.
I’m not saying you should become a total miser and never go out and enjoy life in the materialistic sense. It’s good to go out and eat at a nice restaurant every once in a while and take your family on vacation, just so long as all of that is kept in the proper perspective.
You can enjoy life now by focusing on the things that really matter instead of wasting money to give yourself momentary spikes in utility. You can have the best of both worlds simply by focusing on the more important things in life now and by doing so enjoy life in the present and the future.

Have fun reading...

[quantuminplus]

Published at: Tuesday, June 7, 2011 on Philippine Daily Inquirer

Question: Why are the citizens of our Asian neighbors much richer than us Filipinos?—Name withheld by request

Answer: This is a question that ‘hits the spot,’ as the saying goes.



I just read an article stating that Singapore has the highest concentration of millionaires in the world with 16 percent of its households having at least $1 million in assets, as determined by a study released by the Boston Consulting Group.


Switzerland comes next on the list with 9.9 percent of its households having $1 million in assets. Hong Kong comes in at fourth with 8.7 percent and the United States is at 7th with 4.5 percent.


Don’t even ask where the Philippines ranks as I can’t seem to find it in the news feeds… ouch!


I was in Singapore last weekend on a business trip and whenever I am there, I marvel at how progressive a tiny country with hardly any natural resource can be. I enjoy going to Singapore because it gives me an image of how the Philippines can be when we put our acts together.


We don’t need to limit our sights to Singapore; we can also look at Thailand, Hong Kong, Malaysia and Indonesia and use them as a benchmark.

The answer to the question of why our neighbors are drastically richer than us partly lies with issues on economics.


I can cite many economic facts like low GDP, infrastructure, population and fiscal policy to explain why we have remained poor. However, economic facts are merely indications of some realities that go beyond economic matters and are more social in nature.


One report we can look at is the national savings rate of said countries. Singapore leads the pack with an average savings rate of 50 percent.

This means that on the average, Singaporeans spend half of their income and save and invest the other half; which is probably a huge reason why there are so many millionaires there.


In personal finance, we espouse a 70-30 rule in terms of spending and saving; if you spend 70 percent of your income and you save and invest the remaining 30 percent, you will most likely have a good future.


Facts will show that the savings rate in Hong Kong, Indonesia, Malaysia and Thailand hovers between 30 and 40 percent, really encouraging statistics.

According to the 70-30 rule on spending and savings, said countries will likely have a good future—well at least in theory. A quick visit to these countries will validate their economic conditions in a visual and experiential manner, even if you don’t ogle at boring statistics.


How about the Philippines? This is actually the hard part to write.


Neda reports place the savings rate in the Philippines at between 12 and 16 percent. Following the 70-30 rule on spending and savings, there’s not much promise for our nation. It is unfortunate that many Filipinos have embraced a First World consumerism lifestyle but have a Third World income. We simply do not save enough.


Does this mean we are hopeless? Definitely not. All we need to work on is our savings rate and we can best do so with financial education. We must embrace principles of proper budgeting, controlled spending, financial planning and we can start improving our surplus that will guarantee a better future for all of us.

In time and with the proper stimulus, the nation’s savings rate will improve as our income improves and our spending becomes wiser. It may be too simplistic but I firmly believe that is the answer to our many problems.


Otherwise, we will keep on asking the question why our neighbors are richer than us.

Tinood gyud ni nga article.... kasagaran gyud nato mga pinoy mga spender... dali kaau ma engaño ug palit mga butang nga dili kaau kinahanglan.... like latest Cellphones, flat screen tv maski ok pa kaau ang daan, etc.. permi laag, party ngadto, kung fiesta hala bungga kaau, nya himan2x inutang diay to.. tinood nga kuwang gyud ang sweldo nato e compare sa ubang countries plus inflation pa gyud, pero dili ta magpadala ani.. pero let's look back, what have u done, nganong nisamot kakuwang ang imong sweldo.?
I already knew why Singaporeans, and our other neigboring countries have so many millionaires... they live below theire means.. they alot almost half of their income para investments.. many singaporeans invest in stock market.. they're very educated about it. to those who are afraid of stock market trading then go to mutual funds so that a fund manager will manage the funds pooled. all u have to do is check the navps, and do cost averaging... Naa sad koy na encounter sa internet cafe, ang tag iya chinese. reklamo ang trabahante nga pinoy, " Tihika gyud ani akong amo, d gyud mopalit ug tarung nga silhig, ang bangko gubaon na salig rag mopalit ug bag-o, trapo nga bag- o and etc.. akong gitan aw ok paman ang silhig, ang bangko, ayuhonon ra, ang trapo laba ray kuwang. Maybe 6 months ago mo side ko sa pinoy, but now since na educate na ko, sayup ang pinoy.. why buy new things if magamit pa, maayo pa, etc.? d ba? Lahi ra gyud kaau... mao nang daghang d moasinso nato...
Mag usab nata ninyo... be financially educated...

[quantuminplus]

thanks sa like

[istoryamember]

^^ musta na bro, still investing?

[quantuminplus]

@istoryamember...ok lang bro...o gapuno ko last last week...ikaw?

[istoryamember]

@istoryamember...ok lang bro...o gapuno ko last last week...ikaw?

naka puno na ko for the month of August. Murag last week man tingali to. Busy na jud ko da. Pero sige lang kay daghan2x na pud source of funds para mutual fund

[ofw_cebu]

naa kaha spender to invest? spending money to invest in MF....

[istoryamember]

naa kaha spender to invest? spending money to invest in MF....

yeah spending money to invest or buying assets not liabilities