Protect yourself with Insurance!

Insurance! I understand that when people hear this, they shy away and ignore this. It seems that many people are allergic to the word insurance. I would not blame you, there are factors why the word insurance in our country drove people away.

But let me tell you something, insurance is not something that we should ignore, insurance is truly important in our financial planning. No, I am not going to sell you any insurance so it is safe to read on. :)

I am going to talk about Life Insurance. Currently, we are offered different kind of life insurances generally these are Insurance with savings - sounds familiar? These are not bad, they are still there to protect you but if you are going to buy insurance, let us maximize the protection.

Firstly, what is the use of life insurance? Life insurance is for INCOME REPLACEMENT, meaning if the breadwinner goes to the other life, the family will be left with money and life still goes on for them.

There are 2 type of insurance:

1. Bundled Insurance
2. Term Insurance

Bundled Insurance - Simply this is an insurance bundled with savings/investment etc., so you are paying a part for Life insurance and a part for your savings/investment etc.

Term Insurance - is an insurance where you just pay the insurance value itself, nothing added, just the insurance itself.

What is the difference? The cost. The cheaper Insurance is the Term Insurance and just because it is cheap, it does not mean it will undercut you.

Let me give you an example, I purchased life insurance, I was 24 years old, for me to be covered 1 million pesos, I needed to pay at least 10, 000 Pesos a year with term insurance. If I purchased a bundled insurance, it would cost me twice, the price would be around at least 22, 000 Pesos a year!

I was also taught to buy term insurance and invest the difference, this is a strategy to maximize our money, our protection and our investments. You would be amazed by the results of buying term and investing the difference!

Once again, If I discuss it here, it will be like writing a book so I highly encourage you to join the IMG - Wealth Academy Program! Here you will learn all the financial strategies that you will need.

You can get more details here about Wealth Academy:

https://www.facebook.com/WealthAcademyProgramCebu

If you are in Cebu, you can catch Wealth Academy in 2nd floor, JY Square, Lahug. Every Wednesday and Saturday, 6:30PM.

If you are in Manila, you can catch this at 3rd Floor King's Court 1 Building, Pasong Tamo cor Dela Rosa St. Makati. Every Wednesday and Saturday, 6:30PM.

Cheers!

Picture is not mine, all credit goes to Sephiroth-Art from http://sephiroth-art.deviantart.com/art/Knight-275211602.

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The foundation of building wealth

What is the foundation of building wealth? Many people think that it is just plainly investment. Many think that once you have invested, that's it, it's gonna grow and I will become rich. Let me shock you, investment is not the ultimate solution. Investment is just the tip of the iceberg. 

This was my mistake before too, I thought that once I have invested, that's it! Nothing else to do but to put more and more. I was wrong.

Investing is good but it should have a foundation, just like any building, you cannot establish a 100-storey building without a foundation. Everything that you build must have a foundation, that includes wealth because creating wealth is building wealth.

Here is the Ideal financial foundation:

Increase cash flow - to make money work for us, we have to have money first, earn as much as you can while you still can.

Protection - We need healthcare when we get sick and if we are the breadwinner of the family, we need life insurance for income replacement in case something happens.

Debt elimination - Usually the interest of debt is bigger that the growth of investment, why bother investing if our debt eats all our money up.

Emergency fund - If small emergency rises, this is where the emergency fund should come in, this pays up for the small emergencies. (Not parties or going to the mall, but REAL emergencies)

Investments - Finally, after having established these, it is time to invest, we let our money make more money for us.

Why do all these? For example, we get sick and we have no insurance, where would we get the money? If you have investments, for sure, it will be taken from the investments, this will stop our investment from growing. Same thing with small emergencies, if these event arises, it will all be taken from the investment, worse, have a big debt!

The purpose for this foundation is to protect our investment, we let it grow. If I explain it here, it would like be writing a book! 

I learned all of these in IMG-Wealth Academy, such an amazing venue for learning! So if you have time and want to learn more about this, please do visit the office. 

If you are in Cebu, you can catch Wealth Academy in 2nd floor, JY Square, Lahug. Every Wednesday and Saturday, 6:30PM.

If you are in Manila, you can catch this at 3rd Floor King's Court 1 Building, Pasong Tamo cor Dela Rosa St. Makati. Every Wednesday and Saturday, 6:30PM.

Happy investing!

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