Tuesday, 28 June 2016

4 Retirement Planning Mistakes that You Can Avoid

by: Kyle Kam

It’s never too early to plan your retirement. Often, it starts out with the topic being brought up by your friends or family, which can reveal planning mistakes you’ve already made without realizing it.
One might be wondering on what mistakes you need to avoid in order to have an abundant retirement. Here’s a look at five retirement planning mistakes most people make, and how you can avoid them.

Photo Credit

Having Bad Debt

Borrowing money causes your money to be allocated for past purchases and ties us down from using it on profit-yielding assets.

With calculated risks, it's acceptable to get debt for appreciating assets like borrowing money to grow a business. Bad debt is simply money borrowed to buy a depreciating asset. This includes using your credit card to buy a gadget and paying interest on top of it. An iPhone 5 16GB that you bought last 2013 at Php28,000 is now at Php11,000 - Php15,000 for brand new units.  This is a loss of Php17,000 - 13,000 in a span of 3 years, with the resale value going lower as the phone gets older.

How to avoid it: Avoid borrowing money as much as possible and buy what you can afford in cash. This will make you have the habit of living within your means and only resorting to borrowing in case of emergencies.

Overlooking Inflation

It’s a mistake when you peg your retirement savings at an amount that works at the current standard of living since there is an annual increase in consumer price indexes in the country. According to the Philippine Statistics Authority 2014 Consumer Price Index Report, there was a 6.7 percent increase for food and non-alcoholic beverages. Housing, water, electricity, gas and other fuels index increased at 2.3 percent.

How to avoid it: Personal finance advocates like Randell Tiongson believe in using other means to grow your retirement fund and beat inflation. Investing your money and letting it grow is one way, and products like UITFs and Mutual Funds are perfect for starting out.

Underestimating Health Costs

Healthcare is an inevitable expense that comes with aging. This is an expense that should be accounted for before the diseases hit you. Diagnostic services at the Philippine Heart Center costs around Php2,100 - Php3,200, which does not include consultation with the in-house physician, while their treatment plans for ward heart surgeries range from Php101,000 - Php 800,000. Rates for health care of other diseases may vary so it pays to be prepared when your health will call for it.

How to avoid it: Prepare by giving monthly contributions to Philhealth and getting a health insurance coverage. Keeping up to date with your payments on your health insurance premiums will help lower costs in the future.

Being Indecisive

Planning retirement presents you with hard choices to make in the present so that you can live a financially secure future. Questions like “How much do I save?”, “Where do I retire?”, or “When do I retire?” can ultimately throw a wrench in any plans you have today. The odds that you retire poor are closer to 100 percent if you don’t take any action now.

How to avoid it:  If you’re married and have a family, talk to your spouse and discuss what you need to do since your income is mostly allocated to your children. If you’re single, having conversations with friends or siblings can help you all put together those plans.
Photo Credit

Final Thoughts

The first real mistake when it comes to planning your retirement is not planning at all. But there are others that you might not think are mistakes now – but they might be when the time comes. As much as you can make these mistakes, you can avoid them if you start planning right now.

About the Author:

Kyle Kam is a Digital Marketing Specialist of MoneyMax.ph, a financial comparison website aiming to help Filipinos save money through diligent comparisons of financial products.

Tuesday, 21 July 2015

Don't Jump into Expanding your Business Unprepared

Photo Credit
Lot of companies hesitate too much when it comes to expanding their business on other markets. Most entrepreneurs think that they don’t have enough means to build up a fully operational international company. They are concerned about not having enough funds, skillful workers, or production equipment. This makes them using only one part of their potential, and encloses them into borders that although historical and politically meaningful aren’t such a hard obstacle, when it comes to business ideas.

Going global has never been as easy as today, although this practice has some risks of its own especially for small and emerging businesses. Entrepreneurs need to make an elaborate plan when they want to spread their company’s product or service to another market. In this article we’re going to mention some of the things they should have in mind during this process.

Elaborate Planning

This is one of the most important part of creating a successful business strategy suitable for global market. Most people think that limited research about the target market is enough to make a plan, but they usually forget to calculate one really important thing, and that’s how will this expansion affect company’s business at home. Here are some of the things that need to be taken care of before international expansion.

     Calculating the risks for the business back home- this can be done by elaborate research of company’s capabilities.

     Studying laws, rules and taxes of the targeted market, including company incorporation rules- Different countries come with different laws and taxes and they need to be studied before entrepreneur decides to enter the market. There are also different rules that apply to company incorporation, and by far the easiest way to expand business abroad is to found a company on some of the off-shore territories around the world. These countries usually offer less strict incorporation rules and low tax rates. Singapore company incorporation for example is one of the easiest processes of this kind in the whole world.

     Figuring out the needs of targeted market- This requires deep analysis of the market that should include: market segmentation, gap and SWOT analysis, as well as the figuring out how long it will take for the company to capture targeted sales.

     Developing strategy and business plan for the foreign market- Each company should have short-, medium- and long-term business strategies, as well as defined goals and metrics. Business planning also requires good time management and the share of labor between members of the newly formed teams or company branches.

     Establishing new team of proven experts- Team that’s going to work on the new market should be consisted of experts and in most cases hiring one or several local managers can be a great idea.

     Adjusting company’s product for the foreign market needs- The product should be adjusted so it can fit the rules of the new market and its quality standards. It should also be protected by patent or trademark and all the info about it should be translated to local language.

     Creating a marketing strategy- Marketing strategy should be adjusted to the local needs and culture. There’s also a possibility of hiring local marketing agency to do the work.

   Budget preparation- With all the results companies will have enough information to prepare a 3 year budget plan, with real-time budget reporting and analysis.

      Establishing relationship with entrepreneurs who do business on the targeted market- Establishing connections with local business or foreign entrepreneurs who do business on the market in question can be very helpful for these expansion projects. These small time co-ops lead to creating a solid ecosystem that’s useful for all of its participants.

Daniel Lenson
After almost a decade spent working at various assistant positions, Daniel believes he has accumulated enough experience and knowledge to start his own small business partnering with close friends. When not researching about business matters, he likes to read contemporary fantasy novels.
Follow Daniel on Facebook

Friday, 20 March 2015

Common Investing Mistakes You Should Avoid

To succeed in investing, it’s essential to have the knowledge and to exercise prudence. Investing is something that cannot be done out of a whim. You will need to learn a lot and to gain experience. There are also things that should be avoided.


The following are some of the most important things that should be avoided as an investor:


An investor is different from a speculator or a trader at the Philippine Stock Exchange or Wall Street. Sound investing for a typical investor generally means deriving gains through the appreciation of the share price, dividends, or the repurchase of the shares held. That’s why it’s more important to focus on investing in valuable businesses. Investors buy stocks or put capital into various businesses with a long-term mindset. Of course, these stocks or capital shares are to be sold when there are compelling reasons but not to derive gains from minimal share price appreciation, as speculators do.

Monitoring the Market Minute by Minute

The information coming from financial media like ANC’s business programs and the many business articles online and offline are considered as noise by many investment advisors. It’s usually not productive paying so much attention to them. Information from short-term trendsis usually not that useful and may even lead to decisions with undesirable consequences.

Focusing on One Investment or Thinking that Lump Sum Investment Is the Only Way to Go

Diversifying is one of the most common investment tips shared by highly successful investors, and it completely makes sense. Investing can be a highly risky venture. Why will you put all of your eggs in one basket? The likelihood that one specific investment will become successful through and through is close to impossible. On the other hand it’s also important to remember that investing in one company (the shares of stocks) can be done “in installments” and not lump sum. This is particularly advisable in cases when you are not sure when to buy, when you are expecting prices to become favorable soon.

Getting Fixated on Short-term Gains and Acting Impulsively

Success in investing is generally gauged with a long-term perspective. Investments are evaluated for their long-term potentials. It’s important to carefully evaluate investments that offer tempting short-term returns before deciding to get them. Impulsiveness has no place in investing.

Excessively Relying on Managers

There’s nothing wrong with extending trust and confidence to investment managers or even in equity mutual funds. However, since most managers tend to underperform their benchmarks, it’s better to adopt a more cautious attitude. Also, bear in mind that it’s rare to find managers that can profitably time the market. Take their advice, but don’t put too much confidence, especially once you already know the business of investing.

Going after Performance, Not Rebalancing

Rebalancing refers to the process of bringing back an investment portfolio to its target asset allocation as set in an investment plan. Many investors find it difficult to rebalance, since it means having to dispose well-performing assets and getting badly-performing assets. However, portfolios that have not been rebalanced tend to perform poorly, particularly those that have been allowed to sway with the market.

Most of the items listed above can be easily affirmed by experienced investors, especially those who have already seen long-term gain from their efforts.

This post is brought to you by:
moneymax logo

MoneyMax.ph is the Philippines’ leading financial comparison site where you can save money by comparing financial and car insurance products and services – fast, comprehensive, and free. We aim to give the power of smart purchase decisions back to Filipino consumers by providing everything they need to become financially savvy. Like us on Facebook to get the latest tips on how to save. 

Monday, 14 July 2014

Best Practical Tip on Savings

by Randy Tudy

I had fun reading the answers to the survey I conducted.  If you were one of those who responded, this article is the first response to the series of articles I will be writing.  If you have not participated it yet, click here to answer this ONE survey question.

Photo Credit

A good number of responses focus on their problem on saving money.  I remember when I was explaining this topic to my students. They were so focused listening to me talking about the power of saving.  But when I told them to start saving I got smiles and wondering looks.  I knew what was in their mind.  They were college students who were trying to budget their allowance. Some said, "My allowance is not even enough for me.  How much more if I still save?"

Again, I fully understood their reactions.  Then, I declared, "Whoever are the biggest savers will be exempted from our final examination."  Not only that.  They will also automatically receive a flat one in the final examination grade. 

I began to see glowing eyes, exciting faces.  As a teacher, I know how to motivate students.

They started saving January 3.  On March 3, I sat down in my table, got my laptop and recorded the amount of money they were able to save.  By the way, I asked them to bring their savings, hard cash.  After everybody presented their savings, I sum up the amount using excel.  

I can't believe what I saw.  The total savings of my students, about 45 of them, was a whooping 110,000.00 pesos.  It was a miracle!  How come these students who at the beginning said their allowance was not even enough were able to save that much in just two months?

Here's the secret.  Ready?  Do you want how the miracle happened?

No.  It was not a miracle.

Before they start saving I gave them a very simple assignment when they go home that day.  I asked them to write all their expenses in a week using the table below. After writing all their expenses or where their money goes, they will check on the other columns if they belong to a need or want.

My definition to a want and a need is very simple.  Need is anything you can't live without like food, clothing, shelter, etc.  Want is anything that can either be there or not.  It is something that will not let you die without it. 

I then asked them on the following session what they discovered.  Well, as expected, they discovered that they have wants.  I said, "If you can sacrifice some of your wants, there's no reason you cannot save."

That's all!  My students followed.  

Photo Credit

Now, what about you?  If you are still having trouble setting aside from your income, do what my students did.  Copy the table above and list your expenses.  Be honest of identifying wants and needs.

This simple exercise could change your life.  

So, the first lesson on savings is to sacrifice some, if not all, of your wants. 

If you find this article helpful, share this to our friends so that more will be blessed. 

Friday, 11 April 2014

Important Concepts When Day Trading Stocks

Photo Credit
As with any career discipline is important to have when working as a day trader.  You will have to create your own set of rules and guidelines and you will need to stick with those rules and guidelines.  As a day trader it is easy to fall off track and get side tracked by other things.  When you stop following your own set of rules you will find your focus will not be good and you will make errors. 
Having a strategy that works for you will be another key concept to success.  Not every strategy works for everyone.  When you find a strategy that works you should stick with that one until you become consistent before moving onto another one.  Many day trading professionals will recommend that you have more that one strategy when trading so that you can handle different trades when they come up. 
Photo Credit

Study And Review
Education is one of the most important concepts when trading.  When learning the field of trading you should study different types of trading and the strategies that go with those trades.  In order to be a successful trader you must want to prepare yourself for trading.  You might feel like you are overwhelmed in the beginning but it will get easier along the way. 
Keep A Positive Attitude
It is a well-known fact that people who stay positive have a good energy around them and that will allow for them to be more successful at what they are trying to accomplish.  Even if you are having a difficult kind of day you keep that positive attitude.  Having a bad day happens to the best of us.  However it is important how you handle that bad day.  You should not let a few things going wrong ruin everything. 

When entering the world of day trading you should be disciplined, study and keep a positive attitude.  By keeping all of the key concepts important to you it will be easier to succeed in your trading future by visit here.  By researching and finding yourself a good trading coach and mentor you will find that this will help you to stay on course and stay afloat while just starting out.  Once you learn the basics you will find that day trading can be a rewarding full or part time career.

Saturday, 8 February 2014

The New World: 4 Ways the Recession Changed the Financial Planning Industry

Photo Credit
          Ever since its inception, the financial planning industry has been, for the most part, a reliable industry in predicting the normally unpredictable behaviour of the economy. If the economy was a raging sea, the people that make up industry were the captains that braved that sea. However, the great recession of the mid-2000s has altered that. Now, years after the recession, the financial planning industry has to deal with changes that were left behind by the recession.

Risk Assessment

          There are several effects of the recession, and it is sometimes hard to tell if these effects are positive or negative. But from a financial planning standpoint, changes with the most impact come from a general perception that it can happen and it can happen soon. This puts an entirely new consideration when it comes to risk assessment. People asking for loans for their startup businesses are asked to provide more solid business plans. The equivalent is happening to individuals applying for credit cards.

          Banks all over the world have taken a huge hit due to the recession. Lending institutions have faced certain financial problems as well. Because of this, while certain necessary financial risks are being taken, those risks are highly calculated now more than ever.


          The losses people have suffered during the recession have affected relationships between clients and financial planning institutions. With a great number of individuals either coming close or completely losing their jobs and homes, earning a client’s faith is more difficult than it was during before the recession. While one cannot blame recession victims for the unwitting vilification of anyone even connected to financial institutions, this particular effect undoubtedly hurts the industry as a whole.

Potential Obsolescence

          The abject fear caused by the recession have pushed members of the private sector towards learning as much as they can about the financial industry, slowly making members of the industry itself little more than middlemen between the bank and the individual. This fear, along with the availability of information on the Internet, have people gobbling up all the information they can get their hands on, and this poses a danger to those in the financial industry.

          In an age of electronic banking and online transactions, financial experts, advisers and planners face the possibility of being obsolete. Loans and credit cards can now be availed without the help of a financial planning professional. While it’s true that browsing the World Wide Web for specific topics will never be able to substitute the years of schooling and mastering the craft, as well as the priceless contributions of real world experience, it would all be for naught if there comes a time that no one seeks out their expertise.

Photo Credit

Untrained “Experts”

          In line with what was mentioned above, the way the recession has brought upon an intellectual hunger for all things finance and savings to the general public, that hunger does not necessarily mean there is a more “educated” public out there. The amount of misinformation that can be found on the Internet only tends to mislead and further confuse people. This then would lead to communication barriers between financial professional and the financial novice, sometimes each armed with contradicting information.

          In conclusion, the biggest impact the post-recession world has made is basically the muddying up of the relationship between people in and out of the financial planning industry. Hopefully, despite the seemingly grave effects the recession has left, everyone can focus towards rebuilding for a better future and a more stable financial and economic state.

Author Bio:

Cristina Beltran is a writer for Compare Hero, Malaysias’ leading online comparison portal. Tina is also a freelance writer of several Singaporean sites. He worked as a Researcher before he started his writing career.

Monday, 3 February 2014

Understanding the Importance of Investing at an Early Age

Photo Credit
      While there is no ideal age to start making positive financial decisions, it is important to remember that the earlier you start, the better. Starting early when it comes to investing yields a lot of benefits that are not available to people who get in late in the game. This is not to say that starting to invest at an advanced age is not a good idea, investing your money always is, but it is an obvious advantage when you have a headstart. Here are some reasons why:

Investing Early Means More Time

        The obvious benefit of starting on your investments early is that you give yourself more time to save. The more time you have to save, the more money you end up putting aside. Having more time to save or make proper investments with gives you a better chance of achieving your intended financial goals as you have more time to refine whatever plan of action you have of achieving those goals and have more time to execute those plans.

        Looking at it from a purely savings point of view, with a longer amount of time you have to save money, you will be able to aim for a higher total amount of savings with less of the usual financial sacrifices as you only need to set aside relatively smaller increments at a time.

        There is truth in the adage that time is money. Essentially, more time allows you to explore more options and possibilities, and increases your chances of attaining your financial objectives. Investing early is a good way to assure your financial success simply because it ensures that you will have more chances to do so.
Photo Credit

Investing Develops Proper Financial Habits

        To tap into another tired cliché, it is hard to teach a dog new tricks. By the same token, it is also hard to unlearn old habits. By getting into investments early on, you get to instill some very valuable habits you will be able to utilize throughout the rest of your life. The truth is, we humans are creatures of habit. We are slaves to the things we are just accustomed to doing. From biting our nails to engaging in our morning rituals, our habits are hard to shake off. That is why investing at an early age works. It does not merely teach us to be responsible with how we handle our money, it makes financial responsibility a way of life.

Whether it is properly investing your money, knowing when it is wise to use your credit or debit card, or basically managing your day-to-day expenses in a practical manner, an early start in the world of investments and finance will train you in the wise way of handling money.

InvestingEarly Means Early Rewards

        By investing at young, you will be able to enjoy the fruits of your investments earlier and at a relatively younger age compared to other people who may have started their investment portfolios later in life. We need to take advantage of the situation as Philippines shows signs of economic strength.This may sound grim, but nobody wants to be at a point when they are too old to enjoy their hard-earned money.

        Starting early means you achieve your goals early, and if you choose to be content with that, you can walk away without any regret and spend your time basking in the glory of financial success.

Author’s Bio

Ryan Del Villar is a writer at Money Max, Philippines’ leading online comparison portal. Ryan is also a freelance writer at Helm Word, an Online Reputation Management company. He worked as an online video editor before he started his writing career.