How to start saving

My last post showed a formula how to save money. Sure, that is how to save money but what does it take to save money? How should I start?

Here are some steps on how to start:

1. Have a goal

2. Define wants and needs

3. Have discipline

Goal

In the adult world, we always ask “what’s in it for me?”. “Would I get anything if i do this?”. As people, we do not want to waste our energy in doing something without any purpose, we always do something because we have a reason, we have goals.

Same way in saving, we have to save money to reach our goals, short term and long term goals. Not only we should have short term goals, we also need long term goals such as retirement.

When you set aside money for your short term goals, always remember to set aside money too for your long term goal. Many people end up financially struggling after they retire because they did not plan for retirement. SSS and GSIS will not be enough, I’ve seen elderly people receiving only 2000 Pesos, this is not enough.

So set a goal, plan for your short term and specially for long term.

Wants and needs

To simplify this, Wants are the things that if we do not buy, we will still live, alive and kicking. Needs on the other hand are things if we do not buy, we can kiss the world goodbye! XD

Needs are the things that we need to survive each day as we live, while wants are the things that we can live without.

I had this experience where I went to a mall, saw this beautiful Sony Xperia phone, I truly, truly want to have it, I was very tempted but I had to ask myself, “If I don’t buy this, will I die?”. With that question, I walked away. Anyway my phone is still working, it may not be touch screen but still working.

I know that these descriptions are just too harsh but hey, If you really want to be financially stable in the future, you have to discipline yourself, which is our 3rd step.

Discipline

The hardest part of saving. We are always tempted to buy this and that, I was like that before and what really helped me save money was knowing how the mutual funds work and the needs and wants.

Everytime I get into a situation where I am tempted to buy something that I do not need, I just pop the question above and eventually, I’ll walk away. Harsh but I know it is for my own good.

Another reason I do this is because I do not want to have regrets in my life, so it’s either regrets or discipline. When I become old, I don’t wanna say “hey, I should have saved when I was young.”. And to achieve that, discipline is the answer. Avoid regrets, do what is right. Start saving for the future.

Happy saving!

Cheers!

All credit goes to!BaniTehCat for the picture from http://browse.deviantart.com/art/Taileh-be-thinking-252010967.

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Saving Money 101

Hello all! My name is Neil and nice to meet you! I used to be an Associate Financial Planner of the Philippines (certification expired, just needs renewing) and here I am, writing this blog to share what I know to aspiring investors!

Back in my college days which is not too long ago (really not too long), I thought of building a business, investing in stocks. I was thinking of many ways to earn money, to make myself rich! Then I found out that in making that dream come true, I have to save money and use that money to make money grow, here is a pretty simple rule:

Basics on investing and rule # 1: You gotta have cash! Yes! To make money work for you you have to have...Money!

People often ask me “how could I save if I have a lot of expenses?”. This line is very, very common.

Now to start off and you might have heard of this before, we do have a very simple formula to start saving money!

Here it is:

 100%      10%      20%           70%

Income - tithes - savings = expenses

So for example, my salary is 10,000, I take 10% of that for tithes which is 1000 Php. I take 2000 Php which is for my savings and finally I am left with 7000 Php for all my expenses. Save first before spending and not the other way around! That simple.

You may wonder where we got this. These are Biblical.

Now when payday comes, net of tax, you receive 100% of your pay. The tithes which is 10% is Biblical, as this is giving back to the Lord. (If this is not your faith, your 10% may go to a family in need or charity.)

Why 20% savings? This is also Biblical, when Joseph interpreted the dreams of the Pharaoh, it was said that the Pharaoh should keep ⅕ of the crops to survive the 7 years of famine, which in percentage is 20%.

Then the remaining should be for all your expenses. This formula sounds very simple but for some, it’s not easy to do but as the famous Nike quote say, “Just do it”.

Saving takes discipline and it is a habit, if spending is a habit so is saving. So take a turn, make saving money a habit, remember, this is the stepping stone to investing, if this is achieved then investing is not far from you!

Cheers!


Credit goes to Chocoholikitty from http://browse.deviantart.com/art/Kawaii-Piggy-Bank-97990926 for the piggy bank picture.

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Under Construction

Hello! My name is Neil! Nice to meet you! Okay, so this is my first post for this blog and I absolutely have a ton to prepare for this so I thought while I prepare all the stuff, I take this time to introduce myself and state the purpose for this blog!

Call me Neil, I used to be an Associate Financial Planner of the Philippines. My certification expired and it's just a matter of renewing it. I have about almost 3 years of experience in the financial industry (and counting),    I have not learned it all yet but I'm willing to learn it more and even master it through the years.

Through this blog, I hope to reach out to people who are wanting to save and invest and not only that, I hope to create and add values to people not only financially but also spiritually and morally. Don't worry, I'm not going to bury you with all those savvy terms, I'm a simple guy and I prefer simplicity. :)

This is it for now, catch you soon!

Cheers!

All credit goes to ~recycledwax for the picture http://browse.deviantart.com/art/Under-Construction-121570788.

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