Investing102: Enriching Financial Literacy

Ms Georgia Subido of OFSI talking about the importance of Mutual Funds as an investment instrument

What is Financial Literacy?

From the word itself, it simply means being knowledgeable enough about the importance of having good financial standing and the ways to achieve one's financial set goals and objectives.

But how can someone become Financially Literate?

The answer is simple. EDUCATION.

By education, I'm not saying that the person should be an Accountant, have a Business degree or even earn an MBA for that matter, though that would be a good advantage but at least have undergone basic financial literacy seminar/workshop/class to be aware of its importance. Learning can also be done through oneself by reading business related news and informative blogs that tackles financial awareness, through watching financial-related programs, listening to investment-centered podcasts and clearly the most common of all is by simply attending financial literacy seminars. Obviously this doesn't always come for free since there are operational expenses to be paid like the venue, speakers, materials, food etc. Unfortunately because of these factors these seminars would cost more than a thousand pesos. But even though that's the case, the valuable learnings would definitely come in handy, presented in a realistic manner easy to be understood by everyone and are of course priceless.
From my experience in attending financial literacy seminars, the speakers are always presented to be credible enough in the field wherein they not only discuss about the scope of their lecture in an understandable manner, talk about a couple of mind-wrecking business jargons, tips and tricks on how to grow one's investments and meet financial goals but as well as share their own personal financial experiences from which the attendees can relate to. Overall, this simply connects to the fact that experience is really a great teacher.

Mr Renz Leano, founder of OFSI, talking about the importance of being financially literate

So where can we attend Financial Literacy seminars?

Now that's a good question with a lot of answers. In the Philippines, there are a couple of financial literacy groups from Bo Sanchez's Truly Rich Club to IMG to Colayco Foundation. These groups sometimes cater to similar needs with different objectives but still present different strategies when it comes to investments, business and personal finance. IMG for one, since I'm a member myself, centers its mission on its 5 Pillars to Financial Freedom which in simple terms is all about building one's financial foundation one-by-one from having an emergency fund, to clearing one's debt, protecting one's self by having an insurance and so on. And of course, it should also be clearly noted that by participating in these organizations, one should pay a membership fee or regular contribution for that matter.

For someone living outside of the country, like me, the easiest and accessible way is through free webinars uploaded on youtube or other video platform websites, blogs and seasonal financial awareness programs offered by social groups in partnership with the Philippine Embassy to enlighten OFWs on how to manage their money.

Overseas Filipino Stocks Investors (OFSI) group based in Kuwait after attending a successful Stocks 101 learning session. Credit to the OFSI in house photographer.

Luckily, here in Kuwait, I was invited to be part of a recently established organization called the Overseas Filipino Stocks Investors (OFSI) which advocates to teach free financial literacy for all Filipinos focused on Stocks Investing. The group's main objective is not only to aid free financial guidance especially when it comes to stocks investment but as well as build awareness on the possibilities on how to achieve one's monetary set goals through this pecuniary instrument but also in order to help our country's economy through participating in the stock market. The group started small through like-minded friends which shares the same desire to be financially free and abundant. Through OFSI, its founder and main group members are hoping to encourage more kababayans to be financially literate by providing Basic Financial Literacy seminar specifically catered for OFWs since the people behind this cause are also OFWs themselves. Although I'm new in this field of financial learning, the road to financial freedom looks bright and really exciting!



+++++

See my very first post about my journey towards financial freedom and abundance at Investing 101: The Basics of Financial Freedom

Cariñosa Philippine Folk Dance

Last 23rd of May, the Pinoy Youth Ministry in Salmiya Kuwait showcased a popular Filipino Folk Dance called Cariñosa representing the beautiful culture and tradition of the Philippines in front of different Ambassadors, selected Kuwaiti officials and Catholic parishioners at the Al Zumerida Palace Hotel in Salwa. The event was organized as a "Family Dinner for a Cause" by the Catholic community of Kuwait City Church for the completion of the cathedral in Bahrain.

PYMSK in traditional Filipino costume

Cariñosa Dance Presentation

Video courtesy of SaintGregorie Productions

The presentation lasted for less than 8 minutes combined with colorful video presentation showcasing the beautiful culture and popular tourist destinations of the country.

Investing101: The Basics of Financial Freedom

I love to travel. I love to go shopping. I love to dine and taste different kinds of food. I want to experience what life has to offer. But with my measly income, how can I experience all of this? I'm not even a fan of credit cards and I obviously don't want to be buried in debts just to cater to these wants.

Besides, I'm not getting any younger. I'm already in my late 20s. Five years from now I have plans of settling down (in God's will). I also want to own a house, send my children to good schools and live a comfortable life without thinking much about financial problems. I don't want to work 24/7 a day and live in complete poverty. I want to enjoy my life..financially free to be exact.

But the big question is.. HOW?

When I was in school, everyone would tell me that I need to study hard. Why? So I can finish school and get a good job afterwards. No one encouraged me to try and pursue having my own business. The old mentality of Filipino families is that when you have good education, you are guaranteed to get a good job, you can work abroad and earn good dollars. Funny thing is, not everyone who works abroad earn good dollars. Not everyone has the same rags-to-riches story after working abroad.

So how can I be financially free? From reading tons of articles, I found these easy steps that I'm currently following...and hopefully will continue to do so. *crossesfingers*

STEP 1 is important. KNOW ONESELF. Knowing one's goals in life is important. On my part I would have this little notebook to write down all the things that I want to accomplish and that includes being financially free in the near future. Somehow seeing my goal written down motivates me and obviously this gives a positive sense of inspiration to achieve that objective. My target goal: earn Php XX millions after 5 years. Too big? I don't care.

STEP 2 is obvious. CLEARING ALL DEBTS. Thankfully though I don't have any credit cards, loans or personal debt from anyone. I'm not saying that Credit cards are bad, since they're handy especially if you need instant cash, but based from my Mom's experience -- the interest rate will eat you up. (As of this writing the rate is around ~3% a month of your total accumulated expenses) For example you have Php 30,000 debt on you credit card and you have to pay Php~900 (interest rate) + other charges monthly. Imagine what you can buy with Php 900.

STEP 3 is simple. LEARN HOW TO BUDGET. This is clearly organizing your thoughts on what you want. Check the video for more info credited to Pesos and Sense. :)

STEP 4 needs discipline and connected with the previous step. ALLOCATE A FIXED AMOUNT FROM MONTHLY SALARY FOR SAVINGS. This will not only teach you discipline to save from your monthly income, but it will also teach you the strategy called Compounding Interest. This simple matter of saving up can give you many options for your future needs where you can build your own funds. One important fund that people must have is called an Emergency Fund (3x worth your salary if you're single, 6x if you're married) which is supposedly good as cash that you can rely on when something unlikely happens like losing your job, etc. Dream Fund is something that most people want but never really thought of saving much for. This of course includes money saved for leisure activities and even for shopping for expensive items that's on your I-want-to-have-list. Another important fund which many people doesn't consider much is Retirement Fund, which most Filipinos rely on their future SSS pension. I'm not saying you need to rely on it 101% but there's a good chance that due to inflation rates, your pension 20-30-40 years from now won't be considered that much. Overall, there's like different other funds to enumerate but it still depends on you on where you'd want your savings to be used in the near future. For a good visual example, check the video again.

STEP 5 is a must. GET INSURED. When people hear insurances, they'll think of pre-need companies (for education etc) that went wrong. But insurances, primarily life insurance is fixed, stable and has been in the country for a century. Specifically a life insurance, is a service that would ensure that whatever happens to yo, your beneficiaries would be taken care of. You can of course get a health insurance, which can help you get covered when you and your family members are sick. Thankfully though here in Kuwait I have a health insurance that is compulsory when the visa is renewed. But the question is - what if I'm in the Philippines and *knockonwood* I would need an HMO to cover my expenses and I don't have one? That's a good question right? For more info, check this LINK.   

STEP 6 needs focus. KNOW WHERE TO INVEST. Thankfully there are a lot of financial instruments available for people to invest. There's the stocks, mutual funds, UITFs, treasury bills, bonds, etc. Since I'm a fan of Pesos and Sense videos, check this out.

These steps can be personalized according to your needs, but bottom line is.. when it comes to financial freedom it's all about having focus, discipline and knowing what you really want. :)

PYMSK

Life is all about changes and one of these changes struck me last year. Who would have thought that aside from my SFC family, I would continue to venture out my spiritual journey in serving God as an usherette during the Holy Eucharist? I'm Catholic-schooled but never did I imagined myself dressed in a formal church uniform while greeting people and leading them towards their seats before the mass would start. Nor would I participate voluntarily and happily in any church-related activities that would consume most of my supposed weekend and serve others. But a year has passed, a lot has happened and I'm still part of PYMSK or the Pinoy Youth Ministry in Salmiya Kuwait organized by the Filipino parish priest in St. Therese Church, Fr. Ben Barrameda.

This year marks the Pinoy youth group's first year anniversary. Even us, didn't really expect that the group would survive this long. Obviously, groups are just good during their inception and count towards a couple of weeks until it'll die a slow and painful death. But PYMSK proved different - or at least that's how we all see it. Hopefully though this won't be our last anniversary but would only just be the start.

PYMSK 1st Anniversary Video. Credit to SaintGregorie