I have been investing in the Philippines Stock Market for 3 years now but it never occurred to me to invest in mutual funds. Or maybe it did but I just didn’t have enough knowledge and  motivation that I didn’t push through on it.

A conversation with my The Global Filipino Investors friends yesterday prompted me to do some quick research about how to get started in investing in mutual funds and below are some of the essential background which you might be interested to learn about especially when you’re also toying with the idea of investing in mutual funds in the Philippines.

I’m not gonna try and be an expert in investing because I really am not. However, below are some existing resources which I thought you might also find helpful.

What Are Mutual Funds?

A Mutual Fund is an investment company that pools the funds of many individual and institutional investors to form a massive asset base. The assets are then entrusted to a full time professional fund manager who develops and maintains a diversified portfolio of security investments. People who buy shares of a mutual fund are its owners or shareholders. Their purchases provide the money for a mutual fund to buy securities such as stocks and bonds. A mutual can make money from its securities investments in two ways: a security can pay dividends and interest to the fund, or a security can rise in value. The fund passes any dividends, interest or profits on the sale of its portfolio securities, less fund expenses, to shareholders in the form of distributions. (Source: PIFA)

What Are the Different Funds?

Different Funds, Different Features

In the Philippines , there are currently four basic types of mutual funds which are:

a. stock (also called equity)

b. balanced

c. bond

d. money market funds.

Bond funds invest primarily in bonds such as treasury notes issued by the Philippine government and commercial papers issued by reputable companies in the Philippines . Having a full basket of only fixed-income securities, bond funds provide capital preservation while maintaining a conservative stance in terms of asset allocation. Like bond funds, money market funds also have a conservative stance since they have a full basket of fixed income funds. The main difference lies in the term of investments of money market fund investments, which is one year or less. Equity funds invest primarily in shares of stock issued by Philippine corporations. The dominance of stock issues within the portfolio positions the fund to attain a more aggressive rate of growth. Balanced funds invest in both shares of stocks and bonds, thereby accessing the growth potential of stocks tempered with the presence of secure fixed-income instruments. Professional fund managers create value for shareholders by providing superior yields within controlled risk exposures. Certainly, expective in both security selection and asset allocation go a long way in ensuring better long-term rewards for mutual fund investors.

Why Invest in Mutual Funds?

Mutual funds provide a combination of benefits to investors which cannot be matched by other investment instruments.  These advantages are as follows: (Source: PIFA)

Professional Management

One of the main attractions of mutual funds is that it affords its investors, particularly the small ones, the services of full-time professional managers whose job is to analyze the various investment products available in the market and select those that would give the best possible returns to the fund and its shareholders.

Low Capital Requirement

Direct investments usually require substantial capital.  The minimum investment amounts for Treasury Bills and commercial paper, for instance, range from Php100,000 to Php1 million depending on the bank or investment house you are dealing with.  This also holds true for stocks because while an investor may be able to buy one “lot” (shares are sold in board lots of 10 to 1 million shares depending on the price at which these shares are traded)  for as low as Php1,000 to Php5,000, he may not find a stockbroker who will service his account because they prefer to deal with high net worth individuals (rich people in layman’s terms) or at least with people who have substantially more than just Php5,000.00 to invest.   In contrast, most mutual funds in the Philippines require a minimum initial investment amount of only Php5,000.00 and minimum additional investments of Php1,000.00.

Diversification 

There is a saying that goes,  “Do not put all your eggs in one basket.”  This adage is especially true in the world of investments which is full of uncertainties.  There is no such thing as a “sure” thing.  An important investment principle that requires holding several securities to reduce the risks associated with investing in individual securities is called diversification. When people invest in a mutual fund, they achieve instant diversification because the fund is usually invested in a wide array of securities.

Liquidity 

Liquidity is the ability to readily convert investments into cash.  Other investment products require investors to find a buyer so that he can liquidate his investment.  That is not the case with mutual fund shares because the fund itself stands ready to buy back these shares at the prevailing Net Asset Value Per Share.  While the law provides that redemption proceeds must be given within seven (7) banking days from the date of the redemption request, most funds are able to pay the redemption proceeds within a day.  Mutual funds are, therefore, considered very liquid investments.

Safety 

Safety is a very important consideration for most investors.  Sometimes even more important than potential returns (well… on second thought, maybe not).  Nevertheless, mutual funds are highly regulated by the Securities and Exchange Commission under the Investment Company Act and its implementing rules.  They are prohibited from investing in particular investment products and engaging in certain transactions (this is discussed in greater detail in a latter section).  They also have to submit regular reports to the SEC as well as to their shareholders.  As mentioned earlier, all of the fund’s assets must be held by a custodian bank for a safekeeping.

Potential Higher Returns 

Because a mutual fund is managed as a single portfolio, it is able to take advantage of certain economies of scale.  For instance, with its millions under management, it can negotiate for lower stockbrokerage fees or command higher interest rates on fixed-income investments.  In the end, however, it is still the investment adviser who really makes the big difference between making direct investments and investing in mutual funds because very few individual investors can match the experience and skill of full-time professional fund managers.

Convenience

In other countries, mutual funds can be purchased directly from a funds or through a broker, financial planner, bank or insurance agent, by mail, over the phone and increasingly over the internet.  The popularity of mutual funds in the Philippines is fast catching up.  It may be a matter of time for this level of convenience to be a reality in the country.  Funds also offer a variety of other services, including monthly or quarterly account statements, tax information, and 24-hour phone and computer access to fund and account information.

Which Companies to Invest in Mutual Funds?

Philippines Investment Funds Association (PIFA) has provided a list of companies where you can get started investing in mutual funds. Learn more about how you can grow your money through mutual funds through Alkansya ni Juan’s article.

Learn how to invest in the Philippines stock market with two sets of action packed seminars with Marvin Germo on 20 July 2013.

The seminar is open to newbies and Overseas Filipino Workers Expats who would just want to learn the basics of what the stock market is and how feasible it is to earn even if they are working abroad.

Module 1: Stock Smarts Singapore: Stock Market Basics
Date: Saturday, July 20, 2013
Time: 1:00pm – 4:00pm

Module 2: Stock Smarts Singapore: How to Find The Perfect Timing in Buying and Selling Stocks (subject to booking)
Date: Saturday, July 20, 2013
Time: 4:30pm – 7:30pm

What: Stock Smarts Singapore
When: July 20, 2013

For registration, rate inquiries, and reservation of slots, email: stocksmarts@ephesians.ph

Lastname:
Firstname:
Company:
Position:
Email:
Mobile:
Seminar Expectations:
Market Experience:
How did you hear about the seminar:

The Personal Finance Literary Seminar for Every Juan – Attended by Over 100 The Global Filipino Investors in Singapore

SINGAPORE – Over 100 Overseas Filipino Workers Expats in Singapore attended The Personal Finance Seminar for Every Juan to listen to Mr. Randell Tiongson speak about the Steps to Financial Peace.

The event was organized by The Global Filipino Investors and Alkansya ni Juan in partnership with Kenneth Musngi of Major Homes, Jeremy and Joseph Bamba of Sun Life Philippines and Jess Uy, Licensed Independent Financial Advisor. 

The morning session was attended by over 30 participants and the program started with Mr. Kenneth Musngi of Major Homes discussing about their latest projects. He was then quickly followed by Jess Uy discussing about the importance of Global Diversification. Mr. Uy gave the participants an actual exercise about the Importance of Asset Allocation. Celebrity Speaker Randell Tiongson then talked about the Steps to Financial Peace.

The Global Filipino Investors – Over 100 OFWs in Singapore attended the First Ever Personal Finance for Every Juan Seminar at the National Community Leadership Institute 70 South Buona Vista Road Singapore 118176

The same speakers and topics were discussed during the afternoon section but something unexpected happened. Rico Hizon, the first and only Filipino Anchorman from BBC stopped by and gave a very inspiring talk and shared his optimism about the Philippine economy and the need for Filipinos to step up our game. You may watch the video of his talk at the TGIF Facebook page.

Mr. Randell Tiongson’s Bio, a no nonsense finance advocate

Floi Wycoco, Founder of  The Global Filipino Investors group in Singapore with Speakers Randell Tiongson and Jess Uy (from left to right)

Jess Uy conducting the Importance of Asset Allocation exercise with the participants of The Personal Finance for Every Juan

Participants of The Personal Finance for Every Juan seminar, afternoon session

Kenneth Musngi, AVP of Major Homes discussing about their latest projects in the Philippines

Sir Randell Tiongson with your Saving is Sexy editor

Sir Randell Tiongson discussing the importance of Investing in Yourself

That much-awaited photo op with Sir Rico Hizon. See my collection of Finance Experts in the Philippines album here.

The Global Filipino Investors in Singapore.

From left to right Jeremy of Sun Life Philippines, Sir Randell Tiongson, Jamatz, me, Richard Macalintal, Rex Holgado and Floi Wycoco

You may view all the photos during the financial literary seminar in Singapore through this link and don’t forget to like Saving is Sexy on Facebook for more saving and budgeting tips and updates on the latest seminars and workshops in investing, saving money and making money.

Stabilise Your Finances

The key to successful saving is to consolidate your financial position and ensure you’re getting the most out of your budget. It’s a good idea to try and eliminate any debt that you currently have, or at least consider debt consolidation to combine everything that you owe into one easy monthly repayment. For professional advice on eradicating debt and regaining control of your finances, contact the experienced team at Fox Symes debt solutions. With your finances in order, you can work on a good budget that will help you achieve all of your Christmas savings goals.

Brilliant Budgeting

The key to any good savings plan is a concise and accurate budget. To get the most from your Christmas savings, spend a couple of hours creating a great budget that takes into account all of your income, expenses and extras. A budget lets you have an accurate and thorough understanding of your finances, and lets you use your money to its full potential. Create a special savings account for your Christmas shopping and divert a specified amount of your weekly income into it. Now you get to sit back and watch your Christmas fund grow!

Every Little Bit Counts

You might think that you simply don’t have any money left over to start saving for Christmas, but even the smallest amount quickly adds up. The simple act of putting $10 a week aside at the start of the year will give you over $500 to spend when Christmas comes around. With such a small sum making such a big difference, all you would need to do is have 3 less coffees at work, or bring lunch from home one day instead of eating out. Small changes yield big rewards when it comes to savings.

Santa’s List

Saving is much easier when you know what you’re working towards. Creating a list of the people you want to buy for and some present ideas will help you to allocate exactly how much money you will need to put aside. Having a list is also handy when you’re looking to pick up presents earlier in the year.

Keep an Eye on the Sales

Another great tip to get ready for the Christmas spending is to buy certain presents in advance. Keep an eye on the sales and pick up presents when they are heavily discounted to save hundreds of dollars off your Christmas shopping bill. With a bit of planning and preparation, not only will you have your savings sorted, but you may even end up having all of your shopping done before December is even close!

Getting a head start on your Christmas budgeting will make the festive season a lot less financially stressful. Enjoy Christmas like you should with these great tips and start budgeting today for a relaxed and fun-filled holiday.

- Written by Alex Howard

Are you an OFW wanting to invest your money in the Philippine stock market? Or are you an employee wanting your money to work for you (instead of the other way around)? Or maybe you’ve previously read my article on how I managed to save up some funds for our house. If you’re any of those mentioned, keep reading…

Just like every Filipino, I also want to be financially literate. I always wondered why financial literacy wasn’t included in any curriculum in schools. It’s definitely a knowledge that every person needs to be equipped with especially when he’s about to face the battlefield of the real world. Investing in the stock market requires learning how it works, how much money you need to put in, which companies should you invest in, what resources should you read on a regular basis to keep you updated on the latest news that might directly or indirectly affect your investment and many other things. It’s not just because you’ve heard someone you know, you want to jump into the bandwagon as well. It’s like hearing that Pedro found peals at the Dead Sea and knowing his success you want to jump in without learning how to swim first.

Basic Terms and Resources for Those Who Want to Invest in the Stock Market

Therefore, I highly suggest that you learn how the stock market in the Philippines works first, do your homework as to what specific company you want to invest in and all the basics. I suggest you read my article on The Little Things Every Newbie Should Know About the Stock Market first. I’ll wait for you till you finish reading it. You may go back to this article once you’re done.

It’s a compilation of the list of certified online brokers in the Philippines along with their websites so you can check them out and compare which one would you like to put in your money. I’ve also listed some of the blogs and forums that you can get ideas and news from.

Once done reading the link above, you turn your attention to the following guide guide from Philippine Stock Exhange (PSE) and online broker CitisecOnline.com. It’s a basic guide on how to invest in the Philippine stock market that’s definitely a good read especially for those planning to join the stock market.

Topics included in the guide are the following:

Why invest in the stock market?
How does money grow in the stock market?
When should I start investing in the stock market?
How do I open an account with a stock broker?
How much of my savings should I invest in the stock market?
How do I start investing in the stock market?
How does the PSE protect my rights as an investor?

3. Richard Macalintal - Richard provides great insights especially if you’re an OFW wanting to invest in the stock market and other financial instruments. I’ve first learned about him through this “How to Work in Singapore” blog. He’s very helpful and very generous in sharing the knowledge that he has. You’ll definitely learn a thing or two about investing and making money from his blog.

4. Randell Tiongson – He is my most respected, most admired finance advocate in the Philippines. He provides no nonsense advice and tips to his readers. He’s careful not to use any of those high highfalutin words that might cause excessive nosebleed. I’d definitely recommend his blog if you want to learn more about money management, debt management and be updated of his seminars and workshops.

5. John Mangun – My daily reading wouldn’t be complete without reading his column on BusinessMirror. His opinions about the market are fresh and usually unapologetically  insightful. He’s not going to tell you that the stock market would always be green. He’s not going to give you an assurance that everything’s alright but he always provides kickass assessment of the market and the Philippine economy.

Recommended Online Forums and Facebook Groups for Investors

I’ve previously shared links to some of the most helpful forums that I frequently visit but I would like to direct you to some of the forums and groups that I’ve recently discovered and enjoyed the insightful conversations immensely.

1.  The Global Filipino Investor (TGFI) I’ve learned about the group from Richard Macalintal when I joined one of their Cashflow game sessions. The group was founded by Floi Wycoco and it aims to develop TGFI community in every part of the world that will strengthen financial literacy of every Filipino. TGFI envisions to increase the level of financial literacy in every Filipino household. Do check out their upcoming event on 27 April: Personal Finance for EveryJUAN.

2. Phil. Stock Market Discussions, Comments and Forecast – Perhaps the most newbie friendly forum on Facebook that allows newbies to hear and be heard. Maintained by Remigio Ocampo and several other admins, this community is a great place to ask specific stocks and get insightful reviews and commentaries from co-traders and investors. Remy would also provide his fearless forecasts and lo and behold, the next trading day or week, you’ll see significant movement (upward if you wanna be particular) in the said issue or stock.

Do let me know in the comments below if I missed any other groups which you think could help many other newbies better learn how to invest in the stock market.

Additional Resources for Newbies

You may also want to check out the following articles:

How to open an account with CitisecOnline (an online stock broker)

Free stock market investing seminars (click here for details)

OFW Guide in Investing in the Stock Market (click here to view the helpful PDF by Richard Macalintal)

Are you looking for a place to spend the summer with your family in? Olango Island has got some of the most exciting and budget-friendly package for groups of travelers and even for the whole family.

The Olango Island Group is a group of islands found in the Central Visayas region of the Philippines. It is composed of Olango Island and 6 satellite islets namely: Sulpa, Gilutongan, Nalusuan, Caohagan, Pangan-an, and Camungi. It lies 5 km east of Mactan Island and a major tourist destination in Cebu and  is known for its wildlife sanctuary.

The Olango Wildlife Sanctuary supports the largest concentration of migratory birds found so far in the Philippines. There are 97 species of birds in Olango Wildlife Sanctuary, 48 of which are migratory species, while the rest are resident birds of the island. You may learn more about them by visiting their website.

The Olango My Getaway, fondly called as OMG, is a community-based eco-tourism by the Lapu Lapu City government which aims to provide income to the Olango Residents and highlight the many talented residents of the town and its products. The following activities will be enjoyed for only Php 999 per person for a minimum of 10 pax.

Check out the video below of the route we took during the Olango My Getaway Trip

*25 kilometers culinary tour on bike
*”panulo” after a sumptuous dinner at barangay tungasan
*a taste of island life in a day
*accredited home-stay facility (love the food and the abundant seashells!)
*body massage for only P100

For reservations, call (032)3414107; (0909)6203130) (0933)9585014) or Like the Lapu Lapu City Facebook page for more details

We’ve went to 6 barangays (Barangay Sabang, Barangay San Vicente, Barangay Sta. Rosa, Barangay Talima, Barangay Baring, Barangay Tingo) and enjoyed the local products for each but below are just some of the highlights.

Me during our last day in Cebu. It was great to rediscover Cebu through the MobTrip organized by the Cebu Bloggers Society in cooperation with the local government, volunteers and sponsors. Big shoutout to Ka Bino Guerrero for the insightful tour. Tours in Cebu is best enjoyed with his tireless enthusiasm in sharing the city’s rich history and antics (*Capricornics inclusive)

For only P999 per pax you can stay overnight at Olango, culinary tour on bike, panulo and two meals included. You may reserve through the following  numbers: (032)3414107; (0909)6203130 Marisse Ygot Dapon; (0933)9585014 Daryl Taghoy. For those who can’t ride the bike (*ahem, like myself) they will be accommodated on a tricycle that will follow the bikers around.

Bloggers from different parts of the country like Tonyo Cruz (Manila), Lisa Marie Mirasol of PinayTravelista.com (Iligan), Mary Jane Cabrera (Iloilo) and of course, your Saving is Sexy Editor enjoyed the delightful sweets and other delicacies prepared by the people from Olango. 

Kabkab, a sweet and delicious delicacy from Barangay Sabang

The world is your runway mode at the Olango Wildlife Sanctuary

Me and Lisa together with the kids in Olango

Mobtrippers on our way to catch a glimpse of the various birds at the Olango Wilflife Sanctuary

Lamaw (coconut juice sweetened with love, charot!) 

Corn coffee, anyone? 

My favourite of all the food prepared during the trip! I tried not to be biased but this has got to be the ultimate must-try, must-buy, must-take-home (lahat na!) It’s called Sunlutan. It’s made of sea cucumber that’s perfect pulutan. It felt like I could survive for a whole month just eating this daily. Yes, it’s dang good at that! 

Rediscover Cebu with this exciting getaway package by the people of Olango. I highly commend how organized, how helpful and resourceful these people are. The place felt like a home away from home, giving a mix of peace of mind and adventure – all in just one place at Php 999 per person. But of course, don’t just take my words for it. Watch the video below of Ka Bino Guerrero together with some of the mobtrippers and see how much they enjoyed Olango

Image Credit (Lapu Lapu City Facebook Page, Herbert Kikoy Photography)

Background: To give you a little background about me, I’m 24 years old, currently an OFW in Singapore working for an advertising firm.

Just like every Filipino, I’ve always wanted to have our own house. My father used to be an OFW in Saudi Arabia and worked as a welder. However, I grew up as someone with NPA (no permanent address). We would rent from one place to another and even stayed with relatives even if it means a tiring commute daily just so I could go to school.

“From small and simple things, great savings can come to pass”

At the age of 15, my father died. Being the only child, I promised to take for myself all the responsibilities of providing for my mom and myself. I also promised my late father that I will be the one who will make our dream a reality – to buy our own house.

At the age of 17, I was already working as a senior cashier at a fast food store in my hometown. It wasn’t easy working at night and studying during the day. There were times when I had to open my almost empty notes on my way to school just to catch up for my exams. There even came to the point when my one of my teachers told me he would give me an ‘F’ for a grade if I kept being late in my classes. Undaunted, I still kept working and studying at the same time and doubled my strides. I was paid Php 24/hour then. I’d be lucky if I get over Php 3,000 per month as a salary (it means some classes were skipped just to be able to get high man hours and salary).

Looking back, I definitely do not recommend skipping classes but I am so grateful I had to work hard because it taught me the value of self reliance that I couldn’t have learned in any other ways.

For over a year, I worked in the same fast food chain till I graduated. A week after our graduation, I immediately took advantage of STI College Kalibo’s Enrollment to Employment system. I joined the Job Fair and was so fortunate to have been hired by a BPO (Business Process Outsourcing) company called Callbox Inc (now Parallel Processing Corporation). I’ve worked with Callbox for over 4 years handling various accounts from Merchants, IT Products and Services, APAC and Marketing. Looking back, I’ve learned so much about blogging, internet marketing, digital marketing and advertising through the networks that I have built during the time I’ve worked there.

You’re probably wondering by now how did I end up saving at least one million pesos when I was only paid Php 11,500 per month (incentives not included) and how my experiences were related to saving money to buy a house. Simple – I’ve gone through so much hardships in life that collectively, they’ve motivated and fueled me to really work hard for my goal which was to save money and pay for a rent-to-own-townhouse.

Below are some of the steps I’ve taken that have helped me towards my goal of saving for our first ever town house:

1. Choose the rent-to-own scheme
Rent-to-own, also known as rental-purchase, is a type of legally documented transaction under which tangible property, in this case a house, is leased in exchange for a weekly or monthly payment, with the option to purchase at some point during the agreement. I chose this type of scheme as I didn’t have large amount of money then, yet I had a burning desire to get ourselves a house. Choosing this type of scheme, I had ample of time to actually save up for the down payment and the monthly mortgage.

Also, who wants to pay monthly on house rent when you can buy one that will eventually become yours?

How I saved money for this townhouse?

2. Buy at pre-selling
Properties are being sold at much cheaper price when you’re going to buy them during the pre-selling period. The townhouse’s total contract price during the pre-selling period was around Php 970,000. Now the current selling price is Php 1,025,000. Since we chose the unit that doesn’t share its backyard with other tenants, we had to pay additional Php 30,000 making it to value around 1 million pesos. We’ve paid the initial down payment which was around Php 235,000 and the rest I’ve tried to save up before the unit was fully finished and before we moved in.

The time we’ve spent waiting for the townhouse to be completed allowed me to actually save up monthly to pay for the remaining balance before we moved in so I didn’t have to pay for interest. We decided to get their in-house financing but I used that opportunity to raise the money needed. Every month, I would save up around Php 15,000 or even more, if my salary permits.

When looking for a house to purchase, make sure that you look at various options. Try to search online, ask your real estate agent, ask for referrals from friends and even consult the newspaper ads to make sure that you’ve seen various options before committing into buying.

3. Get a job. Several jobs, even
When I was saving for the house, my meager Php 11,500 per month salary with the company I used to work with wasn’t enough. I had to take on another job and other freelancing jobs in order to make both ends meet. I had to raise at least Php 15,000 a month in order for me to pay for the remaining balance. My goal was to raise enough money which was around Php 750,000. I took a virtual assistant job. I would write articles, learn SEO, teach Koreans English.

In short, I tried to be a superwoman.

There was even a time when I only had a couple of hours of sleep in a day. I didn’t care, I had to make and save enough money.

4. Open a savings account in a thrift bank
After 6 months that I’ve been working with my previous company, I opened a savings account with City Savings Bank (an Aboitiz company). During that time they only required Php 100 as an opening balance so with firm goal to save money, I gradually placed my hard-earned money there. Every month I would put in Php 4,500, sometimes Php 500. There were even months when I could only save Php 2,000. It didn’t stop me from saving, I just kept going. When my salary gradually increases, I started putting in more money I can.

It doesn’t really matter how much money you’re making, it’s about how much you’re saving.

I chose a thrift bank because their system is so simple. You put in some money, you get interest monthly and there’s not much pressure to keep a high maintaining balance when compared to larger commercial banks. Saving was so easy I had more time to focus on making money.

5. Learn how to invest
Then I learned about how to invest in the stock market. I’ve put in Php 25,000. I bought some shares of Jollibee Foods Corporation (JFC) at around Php 78.00 (before the news of them acquiring Mang Inasal was announced) and they skyrocketed to around Php 90+. I sold it at that around range for a profit.

I’m not telling you to simply invest in the stock market. What might work for me may not work for others. You may try to invest in other financial instruments such as time deposit (for starters), real estate, bonds, etc. Learn how they work and find out which one may be more suitable for your income, lifestyle and knowledge. Don’t rush.

6. Prioritize the needs, eliminate the wants
I had a meager salary but I managed to save at least 60% of it because we would only purchase the things we really needed to. Instead of buying new clothes I would save up the money to invest in the stock market.

I’d like to think there was a magical formula for me to save money but there isn’t, really. You just need to have this really strong desire to save up. List down the item(s) you want to purchase and if possible, print it up, frame it so it can serve as your constant motivation to keep working towards finally achieving it. Luckily, I have my mom who always reminds me of my goal. You may also want to share your goals with someone you trust so that you would be constantly reminded and become closer towards achieving it.

7. Give back to the community
Even if I was trying to save up, I didn’t forget to participate in activities that help our local community. Together with our fellow church members, we would volunteer our time to help those who needed some aid (whether it is financial or emotional support). By helping those who are in need, it made me become clearer and focused with my goals. It has helped me realize that I’m so blessed to be able to work and able to save up for what I want to have. Such experiences helped me to become much more driven to keep working towards achieving my goal.

We’ve moved to our rent-to-own townhouse last November 2012. It’s not a fancy house. It’s a 2-storey, 3-bedroom house and got all the things we needed. I probably couldn’t ask for more. The journey towards earning and saving the money to get to pay it within 2-3 years wasn’t easy…but as I look at it every day, I can say – it’s all worth it.

UPDATE: Prices of properties in the Philippines may vary. I happen to be in the Visayas area of the Philippines where properties are much cheaper when compared in Manila so Php 1Million was enough. I am not admonishing everyone to try just to invest in the stock market. You may also want to explore other financial instruments.

I just hope that it may inspire many others to save up. If you want something, you’ve got to be ready to take the baby steps. Just like most Filipinos, I dreamed a dream..but I didn’t stop at dreaming. I worked so hard to make my dreams a reality, hope you can too! Feel free to share your story in the comments below!

Let’s inspire one another.

The following infographic from GMA News gives an overview of the tuition fees in some of the leading universities in the Philippines. The cost of education in the Philippines has been increasing and it has been a challenge for parents to to prepare for their kids education expenses.

I remember a conversation with a friend who’s about to study at the ADMU telling me that her family has to prepare 1M Pesos for her education on her first year as the tuition fee is about Php 100,000 per semester and of course, the cost of living and other expenses such as her accommodation, food and allowance.

Parents are currently faced with the increasing challenge as to how to save money and prepare for their kids college education expenses. Every year, colleges and universities increase their tuition fees without prior notice so it’s important that parents have the fund for their kids education prepared or at least have the constant cash flow to be able to fund for their kids educational needs.

Below are just some of my suggested ways on how to save money for your kid’s college education.

How to Save Money for your Child’s College Education

1. Prepare your kids even in their nursery or grade school years

I remember reading an article I’ve read in a newspaper about the youngest genius and how he was able to get various universities compete for his attention. A normal student would have to take the entrance examination to get to the high quality universities but the young genius had it the other way around. The universities wanted him.

While not everyone can become a genius, the early years in a child’s brain development is greatly affected by his / her environment. It is therefore important to ensure that your kids grow up in an environment where creativity is encouraged and that their thinking ability is constantly being positively challenged.

When your kids perform well in school during their early years, they will have higher chances of getting scholarships thus decreasing the money required for their college education.

2. Both parents should have understanding of financial planning

Robert Kiyosaki once said that it is parents responsibility to send their kids to school but it is also important for parents to teach their children financial education in order to survive the real world.

When parents themselves have ample personal finance knowledge, it would be natural and much easier for them to pass on the knowledge to their kids. They say that the best way to teach your kids is by example. Therefore, it is important for a couple of talk about finances even at the early stages so both can plan ahead. While the wife is usually the one that does the budget and plan for the family’s finances, the husband can also actually provide his insights and both can share have a better understanding of the family’s financial standing and needs.

3. Preparing the funds do not start when the kids are graduating in high school

One of the most common trends with Filipinos is that most parents would worry about their kids education only when the latter reach the high school stage or when they climb the stage during the graduation. In order to better prepare for the kids college education, parents must prepare beforehand by having investments which would eventually yield higher interest in order to pay for the tuition fees. The mantra we’ll cross the bridge when we get there is definitely not a good idea and very risky because every year commodities and our basic needs are becoming much more expensive than the years before.

4. Let the kids learn the importance of becoming self reliant

Parents want the best for their kids that’s why they work so hard just to provide the best that they can for the whole family, especially when it comes to their kids education. While it is the parents responsibility and obligation to send their kids to school, it is important to have the kids understand the importance of being self reliant and how this will eventually benefit them in the future. Teaching the kids the value of self reliance will not only make it easier for the parents to better prepare for the kids college education but it will also help the kids better prepare for their future dealings.

Teaching the kids the value of being self reliant will make them better understand the value of working for the money and have the desire not to rely on their parents solely. Such training will benefit both the parents and their kids in the long run.

Those are just some of the tips on how can parents better prepare for their kids college education. Do you have any other strategies which has helped you in saving money for your children’s education? Feel free to share them with us in the comments section.

I’ve only been working in Singapore for about 8 months and I’m already planning for my exit plan. Just like every Overseas Filipino Workers, I wanna be able to go home in our beloved country and spend more time with my family. Just like for most Filipinos, I dream about not working for someone else but to actually work for myself by having my own business but quite unsure as to which business should I really invest my hard earned money in.

Therefore, I really appreciate personal finance seminars and workshops which help enlighten the minds of people who want to become more financial literate and financially debt-free. I wrote about my excitement over the Personal Finance for Every Juan seminar by Mr. Randell Tiongson in Singapore in partnership with some of the brightest minds from The Global Filipino Investors group.

The seminar will help more Filipinos learn how we can champion financial literacy and how we can push the advocacy of financial literacy to every Filipino. My all-time favourite personal finance expert and financial literacy advocate, Randell Tiongson, will once again visit Singapore to share us the importance of insurance, why we should invest in Mutual Funds, and more about personal finance. You might remember how ecstatic I was when he first visited Singapore (read my post here and here) and do check out the photo during his seminar on Achieving Financial Security here).

There has been an update that the famous Rico Hizon from BBC will also pop in the seminar! I’ve got a feeling that it’s going to be some sort of “tips from the top” event! I’m so going to attend the event just so I could complete my *ahem* Finance Experts in the Philippines album

Rico Hizon, the iconic Filipino Broadcast Journalist from BBC will be at the end, meet him maybe?

Our country, is pretty much like a runner, running the race called the Bull Market.  The steep push in prices since the start of this year, caused uncertainty to many.  As of this writing, PSEi grew 15% in less than 2 months, 52% since the start of 2012 and 256% since the start of 2009.

Fear about the looming drop in the index is growing.  Some have lighten up their positions, others sold all the stocks they’re holding to protect their cash until the market has proven itself, while the rest continue to take advantage of the rising prices.

Are we strong enough to keep going?  Can we endure any unforeseen global headwinds?  Can this bull run last for long?

I was given an opportunity to represent Saving is Sexy in last Tuesday’s  Joint Forum of Philequity and Wealth Securities conducted jointly by Philequity and Wealth Securities.  Much of the questions above are answered by their team whose objective is to help us understand the global economic climate, where our equities market is right now, how far we have fared from the recent global crisis and how strong the trend we are into.

The Conditions of Our Environment

For many years, our country cannot stand on its own.  We go with the tide.  If the world economy rises, we rise too.  If it goes down, we go down too.  We are very dependent and very much affected by what’s happening outside, because we are weak on the inside.

It is an old fact, which was when combined with lack of confidence in our country, drove the PSEi down by 56% last 2009.  How is the world doing as of this time? Have external conditions changed? Allow me to share how the team helped me understand what’s happening outside.

From the Subprime Mortgage Crisis last 2008, where the S&P index lost half of its price, the world had an opportunity of a generation. Philequity, in its article “666 on 3-6-9”, issued last April 13, 2009, declared the ultimate bottom in stocks when S&P 500 Index fell at 666. It was our rare chance to make big money in stocks.

Since the 666 bottom, S&P 500 started to rally.  Every time it starts to go down, new policies called Quantitative Easing (QE), which is merely bond buying to drive interest rates down, was implemented by the Fed.  This was used by the government to put a floor on the index towards the expiration of each policy, keeping stock prices from further falling.  You see, people react towards reduction in fixed interest income rates by transferring their money to stocks to get higher returns.  Ample amount of buyers keep stock prices from falling.  Federal Reserve Chairman Ben Bernanke, the man behind these new policies, is now looked upon as a hero, and his method is being copied by leaders of other financially distressed countries.  We can look forward to more QEs coming, just to keep people’s money flowing into stocks thereby protecting their indexes from major drop.  It is like the Fed telling its people to buy stocks!

That, together with rising Home Price Index, increasing US Housing Starts, decreasing unemployment rate backed by reduction in unemployment insurance claims, plus the US Housing and Financial ETFs making new highs, got me thinking that the US market may now be preparing to launch their own bull run.

On the other hand, the FTSE index which dropped to around 80% of its price because of the European Sovereign Debt Crisis last 2010, is now at its 5-year high after the “whatever it takes to preserve the euro” speech given by the European Central Bank (ECB) President Mario Draghi and the subsequent announcement that they will buy unlimited amounts of bonds from its suffering members.  It was said that any country with a 10 year bond yield at 7% and above will always seek bailout.  Draghi’s plan caused bond yields, of some of its members, to drop to around 3% thus stabilizing Europe.  Draghi, just like Bernanke, is telling his people to buy stocks!

The economic slowdown that was faced by China, who depends largely on exports, had a soft landing.  Optimism about their recovering economy is backed by the rising manufacturing index due to new export demands.  Japan’s Nikkei and Yen are also recovering, and commodity prices are getting lower.

Global weakening started from the housing and credit crisis in the US and it affected its neighbors.  Now that the US is showing signs of recovery, its neighbors are showing signs of recovery too.  The team described this as the great contagion.

With the abovementioned facts all laid out, the team showed that every market in the world is going up.

In addition, you would have noticed that much of the actions and policies implemented by the US and Euro government had something to do with enticing people to transfer their money from bonds to stocks. You are now witnessing the beginning of what the team described as the great rotation from bonds to stocks.

Our Strength Within

Indeed, our environment changed.  We are in a very different climate now from where we were last 2008. But what makes us stronger than our neighbors, is our government’s deliberate efforts to strengthen our own economy.  Philequity, in its article called “Secular Bull Market”, which was last updated January 28, 2013 in The Philippine Star, enumerated facts to prove that our country is in a stronger position now than the developed countries because of a number of structural changes that took years in the making.

The team’s assessment, based on these facts, clearly say, without a doubt, that we have grown much.  We have come too far and this is perceived to last because of the targets our current government has set in place to further strengthen our economy.  This makes our country attractive for business.  The team acknowledged that our country’s growth plus the catalysts we have are far greater than the risks we face today.

The Map

Aren’t these claims off the trail?  What are the charts telling us? The team showed charts of the different world markets and here are a few:

S&P 500 Index (US) is 4% less from its all time high.

I checked S&P’s historical chart when I got home and learned that in 2007, this index attempted to break its all time high mark in 2000, but it failed because the crisis broke out.  Can they make new highs this time?  DJIA Index (US) is also 2% less from its all time high.

Nasdaq Composite Index (US) already broke out of its 12-year high.

FTSE 100 Index (UK) is at its 5-year high and is 10% less from its all time high.

German Dax is at its 5-year high and is 6% less from its all time high.

Technicians know this, that when a market makes a new high it means higher!

These charts clearly show that the world market is near to making new highs.  A worldwide bull run might be ready to take off.

Where We Are Now?

After the team’s review of our country’s environment, after their assessment of our country’s strength and after seeing that the charts of the country from which all these index disaster started are about to make new highs, the team declared that PSEi has very little room for correction.

Our country’s strength, on top of this favorable environment, made them suggest that we stay the course because what is happening is structural.  Being structural means that whatever we have right now cannot be changed in an instant!  The reasons that support today’s bullish trend is strong!  For me, it means we have grown the muscles, have tested our endurance and we are now running on better grounds!  Are these not enough to keep us going throughout the race?

How Should We Fare at This Rate?

“We will remain bullish as long as fundamentals remain intact.” – Wilson Sy, Director Philequity Management, Inc.

The team has set their PSEi target to 7,257 by the end of the year.  At that price, the PSEi will trade at 22.1X 2013E PE.

Despite expensive index price assessments going around, they showed that the PEG (Price to Earnings Growth) of the individual stocks comprising the index is near 1.0.  Investopedia says, as a rule of thumb, a PEG below 1.0 is desirable, but this varies of course with the industry and the factors used.  Also, various brokers already increased their fair value estimates of chosen stocks before the recent trading week ended.  We can now plan our trades based on these increased price targets.

Allow me to quote Jesse Livermore.

“But not even a world war can keep the stock market from being a bull market when conditions are bullish, or a bear market when conditions are bearish.  And all a man needs to know to make money is to appraise conditions.”

I hope that by sharing Philequity and Wealth Securities’ assessments, I have helped you.  But remain watchful.  These assessments are based on known facts.  There are still others left unknown and for some, we have no way of knowing.

But in a very strong bull market, I have learned that one of the best ways to profit is to buy and hold until one believes that the bull market is near its end.  Save some cash to buy on pullbacks, this will protect you from volatility.

The real crisis is in our lack of confidence in this country and in ourselves.

You feared the market when it bottomed last 2008.  You missed the gains.  Now that our market is making new highs, and the world is about to make new highs too, do you want to be left out again?

Enough said… this is just me telling you… to buy stocks!

This is a post by Precious Eugenio. She currently provides accounting management and consultancy services to an animation studio in Pasig City and a Sun Life Advisor. She is not your regular career woman. She is adventurous and intentional in creating the kind of life she wants and she believes she deserves. You can get in touch with her at pmaeugenio@yahoo.com