Define Your Own Meaning of "Wealth"

Who is the wealthier person?

• Someone who drives a P1,500,000 peso car to work with P50,000 savings in bank OR someone uses a bicycle, has P1,500,000 pesos worth of company stocks and has P10,000 savings in bank?
• Someone who frequently buys DVD or someone who frequently buys books?
• Someone who eats fast food or someone who cooks his own food?
• Someone who buys foods in the supermarket or someone who grows it himself?
• Someone who has P2,000,000 worth of a house OR someone who owns P2,000,000 worth of rental property?
• Someone who can afford high medical expenses OR someone who can avoid medical illness?
• Someone who throws a big party every year for their birthday OR someone who invites friends over every night to hang out?
• Someone who earns a lot of money abroad and leaves their family behind OR someone who leaves their work abroad to BE WITH their family?
• In that sense, who is wealthier? Someone who spends time with work OR someone who spends time with loved ones?
• Someone who has a lot of things OR someone who has and needs nothing?
• Someone who can't leave work OR someone who doesn't want work?
• Someone who can see their money in the bank grow OR someone who can see their child grow?
• Someone who pays to fix things in the house OR someone who can fix things in the house?
• Someone who dresses fine, in suits and dresses in the latest fashion OR someone who buys quality (not necessarily in the latest trend) and never have to buy again?
• Someone with a big family OR someone with a small family?
• Someone who owns a gun OR someone who can avoid a fight?
• Someone who follows a religion OR someone who's mind is free from any religion?
• Someone who feel bored when there's silence OR someone who is comfortable with silence?
• Someone who feel bored alone OR someone who is comfortable being alone?
• Someone who knows the latest news OR someone who knows history?
• Someone who knows how to use the latest tech gadgets, know their specs and latest apps OR someone who can create such gadgets, specs and apps?
• Someone who follows other's opinions OR someone who follows his own intuition?
• Someone who can make roaring speeches OR someone who prefers silent deeds?
• Someone who prefers to talk about the problem OR someone who reflects on his own problems?
• Someone who has no time OR someone who has a lot of time?

The Pursuit of the Black Belt

On my list of goals, I said that I want to obtain a black belt in a martial art. Here comes, the hard part, what martial art should I pursue?

This kind of activity is much like investing, it takes careful planning because, at the course of the pursuit, there will be times of doubt, once I know that I have made the right choice, the higher the chance that I will stick to it and obtain the belt.

I have been thinking a lot about this, since obtaining a black belt in a martial art means investing my time, money and body (you may get injured).

Let's see the given variables (me and my condition).. I'm in my 30's, not getting any younger, I'm small, cerebral and doesn't want to get knocked out. I value my brain cells and would like to live a normal life in old age, without punch drunk, dementia or any brain damage. I don't want to fight.

I have a previous experience in martial arts, a knockdown full contact karate, old school style called Kyokushin. Its like muay thai with bare knuckles, no gloves, and you win only when you knock your opponent out or down. And this experience has taught me, fighting will either make you a monk or a maniac.

I became a monk. Metaphorically speaking, fortunately.

So I also want a martial art that does not harm people. But equally effective when there's no other choice. Karate is out of the picture since its a hard style. Bruises and broken bones are its cup of tea. Muay thai and boxing is out as well, even though I admire those arts. I think any form of striking is out. Its either brain damage for me or brain damage for my opponent. Both of which I don't want to have a part of.

Which leaves me with grappling arts.

What's amazing about grappling is you don't need much strength to practice the art. You don't need to be taller. Its cerebral and it doesn't hurt the other person unless you want to. Its the perfect art for me.

My first option was aikido, after reading the book "Angry White Pyjamas" and watching some demonstration from youtube of a master throwing people like paper, I almost got into it. There was one little problem with the art. Nobody would hold your wrist in a fight. Aikido's techniques needs to be performed when the opponent holds your wrist. In the times of the samurai this would have been relevant, as your enemy might try to prevent you from drawing your sword and thus hold your wrist. But today, if someone wants to hold you, it would be more than just wrists.

I always wanted to learn judo. Perhaps if I had been more attentive in my youth, I would have learned the art. But circumstances has made me miss the chance. I'm contemplating the possibility of learning judo, but the thought of it as being physically demanding, makes me a bit wary, same goes for Greco-Roman Wrestling.

Jujitsu. This I think is the perfect art for me. I did attend one class just to try it out, and I liked it. Less focus in conditioning and building strength and more time with sparring / rolling / techniques. No striking and less injuries. The art is effective, because every training session, you go against a person who will 100% defend or resist your attacks. A focus on technique rather than strength. I have seen smaller guys tapped out someone bigger than them. In striking arts, this is not possible. As proof than even 5lbs advantage from a boxer can kill.

I think I found my art now comes the pursuit of the goal.

The Case for Investing and Trading

A couple of years ago I was into trading, it was a fun ride and very educational. I learned the value of money, time, patience and discipline. Trading has thought me, that emotions get the best of us. However sound your trading strategy may be, it will always turn you to the losing end.

Both trading and investing will teach you patience and discipline. Trading on the other hand, is more stressful and instantaneous. Wrong decisions are punished immediately, right decisions rewarded just the same.

Investing will teach you slow money. You wait for years for your fruits to unfold. But in a sense, its more accurate than trading.

I felt that trading, even though having good success with trading, is much like a gamble. No matter how many times I have seen a pattern on a chart, I know what the next scenario would be, and I would trade accordingly, still I am not sure if it will come to my favor or not. For me, it felt like gambling.

I do not like the feeling of having to "guess" no matter how sound the decision is.

Trading is fast, but it comes with a price, you will need to trade your time for the fast reward. Investing is slow and comes with luxury of time.

When you trade, you spend time waiting in front of the computer. From the opening session to the closing. With investing, I feel like I'm reading a book. I'm not in a hurry to buy a share. I want to finish reading the "story" before I could decide. The story is seen in the balance sheet. Comes the time, if I like it, I'll then decide accordingly. In trading there is no such luxury. You are always pressed for time. Trying to outsmart/outspeed the other buyer or seller. I do not like the cut throat environment of it, nor do I see the need for such haste.

I think investing is better, when it comes to comparing resources used for the return on investment. Money should be ignored, assuming both a trader and an investor use the same amount of money. What we have left to consider is time.

A trader will have to spend more of his time to earn. It is the actual time trading. If the market opens at 9:30 and closes at 3:30pm, he just spent 6 hours of his life, everyday to earn a living. An investor may read a company's balance sheet at his leisure, before sleeping or at the breakfast table with his coffee, buy a stock for 5 minutes to get an order and go hiking somewhere, take his wife to a date and play with his kids, travel with his family for the rest of the week.

Its all about the quality of time spent for the amount of reward. Let's say that a trader manages to return 50% on same year (difficult but not impossible) and the investor manages to have a return of 15% (average). I feel like that the investor has a better life when you think that the trader spent his whole year looking at a computer screen 260 days and 6 hours per day (1,560 hours), and the investor spent the same amount of hours with his family, learning new things, traveling and what not. To think that a 30 year old person only has 200,000 hours (give or take) left for his life, I feel that life is too short not spending it with your loved ones.

A trader may "make money from having money" but its the investor who "makes money work for you". Because of the two, its the investor who have the free time and let money do the working.

Dividend Received! P122,010

Amazing how time flies and money grows with it. The last time I received a dividend payment for April, I remember how happy I was, to be able to see this kind of money as if coming down from the heavens, bestowed by the Gods as a reward for the virtue of frugality.

The last dividend payment I received for the same month was P89,474, while it grew on its own, now amounting to P122,010.

The actual money that I received was P109,809, taking into account, taxes that needs to be paid, an increase of 36.36% from last year.

The money will be reinvested, so this too shall grow. I have learned recently the IPO listing of Century, the company that makes the popular canned goods and sardines. I am very much interested in investing in its IPO as I have enjoyed those canned goods every time I hike into the mountains and meals while I was still a struggling youth in college. And I'm all for helping it to expand using the money acquired from its IPO listing.

Regret Comes Last

"Nasa huli ang pagsisisi.". We all know this phrase. Our mothers have been saying this since we learned to speak. When it comes to money, I have a different approach to most people. And this difference and uniqueness makes other people uneasy.

I created this blog to share what I know about investing. And even the friends I have care for deeply, I tried to convince them of the future and their relationship with money. Personal finance today in the Philippines, for me, feels like Pop music. Its like a fad. You're in, if you know what's the definition of mutual funds is. You're in, if you have life insurance. Save or invest 10% of your money. Challenge this belief and you find yourself treated as a fool or a tightwad.

Being treated or told a tightwad does not bother me. I have grown to ignore good titles so bad ones does not tick me off either. What affect me is that people decides to close their eyes unto the reality of things. And they are afraid to look at the grim reality of the life they are heading.

Besides, who wants to be told that you're going to work for the rest of your life in a cubicle if you continue leading the life you have? Now I can feel the fear. So I decided to shut my mouth and just let people live the life they choose. In the buddhist sense, giving unsolicited opinion is also an abuse. Speak only when asked. And so I did.

After years of trying to convince friends and after 3 years of shutting up. 3 close friends came to me and realized that what I've been saying is true. I was expecting them to realize this at the age of 65, but good thing they gave it a thought. Am I happy? Yes. But it wasn't the kind of happiness that I was expecting. Because now, these people are now in my responsibility. I realized that telling them about this truth is a selfish thing. Because I wanted to be recognized. Them coming to me, taught me a lesson. I wasn't happy as I was expecting to be right. I know I'm right. But when they admitted that I was, I was indifferent.

The moral lesson of the story is this. Save and Invest nothing and prepare to regret it later on. 

Follow personal finance's advise of saving 10% of your money in investments, and be prepared to work until age 65. You may or may not regret this later on given your personality. I myself would regret spending my whole life working. What other benefits this does have I do not know. Its yours to find out if you decide to lead this kind of life.

Save and invest 80% or more of your money and you'll be called weird and a tightwad. But you'll be financially independent in 5 years, plus the ability and skills to survive without money.

And there are 2 kinds of truths. Conventional truth and ultimate truth. For people who follow the crowd, culture and society, there is conventional truth. For people who realized and saw the reality of things, there's the ultimate truth. If you try to convince people who only can see conventional truth into looking at ultimate truth, you'll only have misunderstanding. The best way is to leave them be and let them search for this truth in themselves. Until they ask, you should stay quiet.

Aboitiz Power a Potential Winner

The energy sector has been on the news lately. Our good government, concerned of its citizens, took the matter in their hands and asked the power companies why is their maintenance schedule done all at the same time. Our government, thought that it could be a manner of large companies working together to increase the energy prices.

The companies who got hit by this news has been the power players. And here's why I think there's a potential in this.

We are in an energy crisis. No matter what the government say, we only have enough energy to drive our country. The plants are just enough to sustain our needs. What will happen if calamities arise? We also need more energy to fuel innovation. A lot of our provinces still has no electricity. We still use oil and coal for the majority of our power generation.

Oil and coal will increase in its price as the world already have peaked its oil production. Energy cost will increase further and will be passed unto the consumer. What the government fail to see is not power companies manipulating energy prices. Its just that we now see the effect of a larger scale problem.

The largest power producer in the Philippines is Aboitiz power. They are leading the way in using renewable energy sources. Comparing its share price with other companies in the same industry, you can see that this stock doesn't receive much love. But I think that Aboitiz is doing everything right. And ethically so.

Also, there's been a lot of activity lately with the insiders of the company. A lot of buying from insiders only solidified my theory that Aboitiz will be a big winner in the future.

My Desire For Financial Freedom

I will share to you where my desire for financial freedom and early retirement comes from. As a young boy, I have been nationalistic. I used to believe that the Philippines is a great country and have a great potential to be a world leader, its just that the politicians are making this so hard to happen.

But I realized as I grew up, politicians is a part of this country and corruption will not stop until there is no more government. As proof that in any country in the world, there is corruption. And thus, my ideal country is just that, a dream.

I began to see things as it is... My grandfather was a war veteran who fought in the WWII. As a veteran and having a rank, he knows that he will be taken care of. But as my grandfather's illness worsen, I am a witness at how many veterans die waiting for their pension. If its not delayed, its missing. I also heard him said sometimes that he should have cut off his arms or legs instead of fighting the war, that way, he'll have more money to buy his medicine. He died poor. Always waiting for his pension. Sometimes it came, sometimes it doesn't, most of the time it was delayed.

If this is how we treat war heroes, then how could I trust the government?

I then started working. I saw how my father work so much. Contributed to his SSS. He's so busy that I still remember he's not being present at some of my school ceremonies. I understood it and I have no qualms about it.

But just a few years ago, my father suffered stroke and unable to work. He wanted to claim some money from SSS. To our surprise, the money he contributed for 30 years was missing. My grandfather also tried to claim some money from the SSS having contributed for more than 50 years, its also missing. Then the news of big bonuses from SSS executives hit the media.

If this is how we treat workers, then how could I trust the agency?

On my second job, I realized the time as a worker will be divided into 2. One is for politics and the other, actually working. Most of the good people I know at work, does so to improve their work quality. Others, use politics to gain advantage. I became aware of the world of corporate politics. People who get ahead aren't necessarily experts. They just know how to fake expertise. Impostor syndrome (google it) - "people who know a lot, thinks they know little. Those who know little, thinks they know a lot". That's why those who fake their expertise get ahead.

Unfortunately, I am one of the people who prefer to improve my expertise than participate in office politics. But being good at your craft does not get rewarded in a real corporate environment, so I decided to engineer my exit from the corporate world and started my own practice. Best decision I ever made in my life.

If this is how we treat passionate workers then I can see why craftsmanship and Filipino made products are mediocre.

I won't die working for a company who doesn't even know my name, the guy who does that thing in the office. I won't be like my grandfather who offered his life to a nation who robbed him of his life and my father who stole his life's work. If there is someone I would work or die for, it would be me or for my family.

Then the news of pork barrel scam erupted. It just solidified what I was noticing before. As long as there is a government, there will be corruption. No matter what kind of government or organization. And if I put my faith unto the government to provide for my financial needs today and in the future, I know what will happen. I'll just be one of those people who love to hate the government, hungry, unable to feed their families and full of anger.

I decided to make a different approach. I decided not to care about the government or any representation of it in the form of politicians or government programs. I do not vote, for which I am proud. If I can not change the course of Philippine politics then I'd rather be not a part of it. Only rich candidates get TV commercials, just like the impostor syndrome in office politics. The people who thinks they know a lot, are usually the ones who know nothing. And if someone tries to shove their righteousness to me about freedom of voting, I can only say "if voting is a freedom, then not voting is also freedom. For freedom is the ability to do or not do the things you want."

I turn off the TV if its news about the government and read a book instead. The news can only tell the problem, but not solve it. So whats the purpose to watching the news about corrupt politicians? To me, its nothing. Information can be good to some, but for me its just garbage, since I won't be using that information to make my life better. It could actually just depress me.

This in turn made me happy.

Then I turn to solving my financial problems so that I wouldn't depend on the government. I started reading about investments. Invested my money in the stock market and bonds. I prefer the government to pay me than the other way around. And today I don't need SSS or Pag-ibig. I am completely free from the government which makes me happy, I can actually feel my feet float, just a little bit, from the ground when I walk.

Senators and Congressmen talking on TV becomes comedy and not something to be upset about. We paid billions (tax money) for that kind of amusement, we might as well enjoy it.