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Investing Personal Finance real-estate Story

Interview With Millionaire Real-Estate Investor Eden April Alemania-Dayrit

Hey guys! First off, I’d like say THANK YOU SO MUCH for the overwhelming response to the recent Rich Money Habits survey.  I am learning a lot from your feedbacks. Rest assured, I am going through each and every one of your responses.  This way, I get to understand what kind of financial information you are looking for so I know how best to help you. So keep them coming! 🙂

In fact, I have already gone through some of your feedbacks and a lot of them are requests to have more features on real-life inspirational people or leaders who set good examples in building wealth. 

To give you an idea, here are some of the responses to the survey question “What improvements would you like to see in the Rich Money Habits Series?”

“I would like to read about real life experiences of those who have successfully implemented the habits to wealth”
                                              – from Rod of Gensan, Philippines

“More examples of true to life stories. Testimonies.”
                                              – from Leo of Manama, Bahrain

The really great news is we have a very timely feature for your today to address this overwhelming request from our readers.  Lucky for you, I managed to get hold of the young real-estate investor millionaire, Eden April Alemania-Dayrit for an interview here at Rich Money Habits. 

I met Eden last year when my wife and I tried to invest in a private-lending deal for a real-estate property.  We partnered with Eden on that deal.  We have since gotten back our investment with the agreed upon interest income and we are very very happy with the outcome.  Through that deal, I have known how trustworthy Eden is, and that’s why I am very happy to have Eden featured here at Rich Money Habits. 

Without further ado, here’s my interview with Eden April Alemania-Dayrit.

1)  Tell us a little bit about yourself.  What were you busy with before you discovered real-estate investing?

I am a chemical engineer by profession who worked for semiconductor companies handling sustaining operations in manufacturing lines. Thinking that I will be an employee in the long run, I took up a master’s degree in Electronics Engineering. But on the last semester of the course, I decided not to finish it because that was when I began investing in real estate.

2)  What made you decide to get into real-estate investing and how did you get started? 

I got into the stock market and got burned in the mid-2007 market crash and hadn’t recovered. My boyfriend then (now my husband) and I partnered in a dimsum food stall in the place of his employment that later on included a waffle cart. It lasted for 6 months and we realized that food business is not our forte.

While still employed, I read books like Rich Dad Poor Dad and Think Rich Pinoy. These books inspired me to look beyond employment and pursue the path of entrepreneurship. We bought our first piece of real estate — a condominium unit in Taguig where we now live in. To save on acquisition cost, I applied as an agent. Little did we know that it was our spring board in our real estate career.

If I didn’t know how to cut my losses on other businesses early on, I wouldn’t have been in real estate investing.

3)  Can you share with us the story of your first real-estate investment property?

It was a Quezon City townhouse. We bought it from a bank at 50% off market value through an auction and paid a downpayment of 20%. It was then sold at 70% market value on a flexible term scheme (rent-to-own) after 7 weeks of acquisition.

4)  Can you give us an idea about the process you go through before you decide to invest in a real-estate property?

The real estate investing process is actually very simple. Find, fund, fix, sell then profit. But the real issue that most people have a hard time on is the thought process and deciding when to actually jump. I did the unthinkable — I quit my stable job. And that made it easy for me to decide to pursue the first property because I basically put everything at stake. It was a "now or never" decision that pushed me to do well. (Though I don’t advise people to do the same because that decision also had repercussions like I couldn’t take on a loan because I didn’t have a job that the bank requires to have that forced me to take on investors at the very beginning.)

5)  What’s the most important habit you’ve learned so far that really helped you in your real-estate investing?

I learned to listen to mentors. I am a stubbornly independent person and I find it hard to do things if I don’t do them my way. But when I agreed to be under my mentors’ wing, I had no choice but to follow because I believed in what they taught me. I listened intently until I learned the ropes in real estate investing. Until I learned it well, I then improvised. I still am stubborn, but I use that trait to stubbornly pursue the deals that I am getting into.

6)  If you can start your real-estate investing all over again, how would you do it differently, and why?

I’ve made a few mistakes along the way. Sometimes I wished that I could’ve asked for a higher price for a property or wished I didn’t buy a certain property. I sometimes thought that I should’ve set my criteria higher in selecting tenants. But these things were easily remedied and didn’t hurt a lot because I’ve set contingencies too. So if I could’ve done it all over again, I will still do what I’ve done because the small mistakes made me a better real estate investor now.

7)  Why do you think you’ve succeeded in real-estate investing at such a young age while many others struggle to even get started?

I’d say that age doesn’t have to do with it. It just so happened that I started earlier.

The main factor that hinders a lot of people from succeeding is one’s mindset. I always say that every basic thing that you need to know about real estate investing are all in the books. And you will learn along the way some techniques that will be useful. But all these will go to waste if one’s mindset is not on the right track.

This may sound funny but believe me, work on your mindset, get educated on the business and everything will fall into place.

8)  What advice can you give to our dear readers who want to get into real-estate investing?

I get a few questions like, “We are looking at the same lists in banks and newspapers, how do you spot good deals?” I’d always say, start by familiarizing yourself with the prices of properties for sale or sold in your own area or the area you want to focus on. Walk around the neighborhood and ask around, network with brokers and look at online sites where these properties are posted. Naturally, the opportunity will present itself in the form
of undervalued properties for sale or of neighbors seeking your help in selling their property.

I describe myself as a perennial student because I continually enroll in classes for self improvement. Invest on yourself by attending courses or seminars specific or supplementary to real estate investing.

Seek mentors. Accelerate your learning curve by asking questions or partnering with someone who have done what you want to do.

Lastly, be persistent. Do not stop at the first sight of failure. At 24, I overcame barriers and accomplished a feat that I haven’t even dreamed of myself–all because of my persistence, and I’m sure you can too.

 

More about Eden: Eden specializes in real-estate investing through rent to own properties and dreams of helping create 1 million millionaires by 2020.  You can checkout her website at http://renttoownproperties.blogspot.com/ to find out her growing list investment properties.  If you’re searching for a house you want to invest in, Eden highly recommends checking out http://www.bahayatbp.com.

 

P.S.  Dear readers, I hope you enjoyed Eden’s story as much as I did and learned something that you can apply into your own situation.  Have you tried investing in real-estate?  How was it?  What other tips can you share based on your experience?

Categories
Life Lessons Money Mindset Personal Growth

Top 10 Things The Angry Birds Can Teach You About Money

If you’re like my wife who once got addicted to playing Plantz Vs Zombies, you would have heard the popular game “Angry Birds” by now.  “Angry Birds” is a popular puzzle video game where the player uses a slingshot to launch the birds to try to destroy the pigs hiding under protective structures such as wood, ice and stone. 

After a watching my wife get excited playing the game, I decided to try it myself.  Lo and behold, I got addicted to playing the game as well.  Now, my wife is waiting for me to put down the game so she can play. She’ll have to wait her turn this time around. 🙂

While playing, I realized there are some things about the game that are also applicable to managing your own money.

 

Here the Top 10 Things the Angry Birds Can Teach You About Money

 

1.  It’s OK to miss

In the game, you launch the bird by getting ready…aiming at your target as much as you can…and then releasing the slingshot so the bird can fly!  You missed your target? Try again! 

In real life, it’s also OK to try again.  You may lose money.  You may feel discouraged.  You may think your money problems are eating you alive because of a bad financial decision.  It’s not the end of the world.  You can try again.  And again, until you succeed.

 

2.  Some birds are better than others

In the game, there are three other types of birds that can destroy the hardest wooden structures when you “tap” on them.  The blue bird splits into three small birds.  The black bird explodes like a bomb.  The white bird drops explosive eggs.  Each one is suited for different instances.  But all of them helps you destroy the structures easier. 

In life, there are a lot of ways to earn money.  The most common of course is having a job.  You can sell your crap (according to Baker of ManVsDebt.com).  You can invest in real-estate.  You can invest in the stock market.  Or you can just simply find other ways to solve other people’s problems, and they will be more than willing to pay you so you can take their problem away from them. 

 

3.  Birds don’t fly with the pigs

In the game, I always wondered why the birds are angry at the pigs.  While reading more about the game, I realized they are actually trying to retrieve their eggs taken away by the evil green pigs. 

Pigs can destroy your eggs.  At least figuratively.  Pigs are people who scam people of their hard earned money without giving value in return.  Pigs are deceitful individuals who have nothing better to do other than send you a spammy text message asking for a prepaid load.   The lesson?  —- If you want to get ahead, don’t fly with the pigs.

 

4.  Protect your pigs with a strong shelter

Ok, let’s try taking the perspective of the pig for a moment.  If you know the game, the pigs are pitiful creatures.  Because of their round shape, they just roll over the structures until some wood drop on them and they die.  In the game, there are three types of shelter — wood, stone and ice.  The hardest to destroy is stone.  So it’s definitely a good idea to house your pigs made of stones.

When it comes to your money.  Be very sure where you are placing your bets on.  As some people say, put all your eggs into one basket and watch that basket.  The key phrase is “watch that basket”.  You have to protect it with all your might.  Otherwise, you lose all the money you’ve got.

 

5.  Life gets harder and harder…so you can get better and better

Since angry birds is a puzzle game, it gets harder and harder as you level up.  For instance, the higher you go, the more strong stone structures you have to destroy, and the more weird looking pig houses there are. 

In real-life you should try to learn something new every day.  You can start by learning to save your money.  Then you can learn to invest the money you saved and make it grow.  Afterwards, you can then go on to other more challenging things.  

Keep the hunger alive.  Keep on learning.  Keep on taking those challenges so you can get better.

 

6.  The more you launch…the better you get

In the game, the first time you launch the bird, you fail miserably.  The next time, you can adjust your aim so it goes a little bit nearer your target.  And you can go and adjust your aim on and on until you hit your target.

In real life, nothing beats taking action.  You’ve not really learned something until you’ve done it yourself.  You can read all the books you want about investing in real-estate, but if you’ve never purchased an investment property in your life, you lack the necessary experience to truly learn investing not only mentally but emotionally as well.

Sometimes, people are held back by their own fear.  Fear of failure.  Fear of being wrong.  Fear of being different from everyone else.  Unfortunately, the more time you spend worrying about your fear, the stronger it gets.  The ironic thing is once you take a little bit of action, the fear actually goes away.

 

7.  Don’t try to break a stone…learn to quit

At certain stages of the game, you have to deal with stone structures.  They are strong.  They are indestructible no matter how hard the birds hit the stone.  You can put everything you’ve got but as long as you’re hitting the same spot on that very hard stone, you will never be able to bring it down.

In life, it’s OK to quit.  You don’t have to go through life being miserable.  If you think that what you’re trying to do is not working, you can quit.  If it won’t take you to where you want to be, then by all means, quit.  You can be true to your dreams even if you quit often.  The interesting thing is, the most successful people quit a lot of things so they can focus on the things that really matter to them.

 

8.  Aim for the weakest spot

The trick to playing the game of “Angry Birds” is aiming at the weakest spot of the structures.  The structures may be made of the hardest stone there is, but if one spot is made of wood, you can aim your bird through that one tiny spot of weakness and you can bring the whole house down. 

This is especially true for business.  If you want to be successful, you have to stand out.  You have to be different.  You need to offer your customers a new better way to solve their problems.  If you do, it would be like hitting all your competitors in their weakest spot.

 

9.  There are a lot of ways to get to your destination

In the game, you can aim the birds high so it arcs upwards and aim straight down to the structures.  Or you can aim them horizontally so you hit the structures by the side.  No matter what aiming you want to do, you can turn down the structures as long as you keep on aiming at its weakest spot.

There’s no such thing as one way ticket to success.  Henry Sy became successful because of SM malls.  Manny Pacquiao is rich because of boxing.  Warrent Buffet became one of the richest man in the world by getting really good at investing.  No matter where you are right now, you can be still be rich by finding your own way to succe
ss.

 

10.  Have fun…no one gets out of life alive

The game is addictive because it’s fun.  It’s challenging.  It makes your mind think of different ways to achieve your goal of bringing the structures down so you can destroy the pigs.

Life should be the same.  It should inspire you to keep on dreaming.  It should give you challenges to overcome so you can tap into your inner genius and become the rich person that you truly are. 

And it should certainly be fun. 

Keep having fun.  Keep learning new things.  Keep believing in your dreams.

Cheers!

Categories
Investing Stocks

How To Invest In Stocks In Your Sleep

What if I tell you you can invest in stocks in your sleep?  How would you react?  I realized you actually can…literally.  Read on to find out how.

Before I proceed, I would like to clarify what I mean when I say “invest in stocks in your sleep”. I don’t mean logging on to your computer like a zombie, eyes closed, still dreaming in your sleep, typing away at your keyboard in the middle of the night and placing an order to buy shares of stock.

I also don’t mean it’s easy to buy stocks.  Doing anything “in your sleep” figuratively means it’s easy. What I mean is more literal than that.

If you’re halfway around the world from the Philippines, you can put your order during your day, and while you’re asleep at night, the official trading hours of the Philippine Stock Exchange begins and your order automatically gets processed and invested in shares of stocks of your choice.

In short, while your order is being processed and buying stocks, you are practically sleeping. How about that? 🙂

Ok, I must admit, it’s more accurate to say “how to buy stocks in your sleep.”

Now, that I’ve got your attention, let me show you exactly how.

How To Buy Stocks In Your Sleep?

I’ve been asked many times before how someone can invest in the Philippine Stock Market outside the trading hours which is from 9AM to 12 noon.  Here’s one from Jezz logged under the comment section of my article Online Stock Market Investing in the Philippines.

“Mr. Allan, Am I right to assume that I can only trade from 9am to 12nn Philippine time? You see, I’m somewhere in the Middle East and 9am Philippine time is only 4am here. I find it quite difficult to trade in CitiSeconline because of this time difference.”

I’ve also had this dilemma myself so I was actually looking for some answers but with no luck.  Until now.

CitisecOnline, Inc has officially allowed placing an order to buy stocks outside the Philippine Stock Exchange trading hours (9AM to 12NN) starting September last year (apologies for sharing this to you just now).  It starts from 1PM to 8AM the next day.  Here’s a definition of Off-Hours orders from FAQs of the CitisecOnline site.

What are Off-Hours orders?

An Off-hours Order or ‘After Trade hours Order’ (ATO) – the Off-hours ATO Order is provided to allow customers to enter orders after closing in preparation for the next trading day. ATO orders are accepted after 1:00PM and before 8:55 AM weekdays and anytime on weekends. Off-hours orders will be collected on a first come first serve basis, and will be sent to the Exchange for posting on a first in first out basis during pre-open session. After posting, all Off-hours orders immediately become Limit Day Orders and cannot be cancelled/modified during (9:15AM-9:30 AM). All orders will be governed by the Exchange’s order regulations. For orders during market activity (9:00 AM to 12:10 PM), please use the regular “Enter Orders” function.

There are many reasons why someone would want to invest outside of the trading hours.  The most common is due to schedule restrictions.

For example, you may be working on a night shift and during the day, you would rather be taking your much needed sleep than go and buy stocks during the normal trading hours at 9AM to 12NN.

Or like Jezz you may be living in the Middle East or somewhere on the other side of the world.  Now, you don’t have to wake up in the middle of the night just to place an order to invest in your favorite stocks.

I was so excited about this development I decided to try it out.  Here are steps I followed to place an off-hours order.

How To Place an Off-Hours Order

1.  Log-in to your account at CitisecOnline.com

2.  Click on the ‘Trade/Portfolio’ tab

3.  Click on the ‘Off Hours Order’ section

4.  Enter your order details: Stock Code, # of shares to buy, and price, etc

5.  Click the ‘Preview Order’ button

6.  Review your off-hour order details

7.  Enter your password

8.  Click ‘Place Buy Order’ button

After following the above steps, you should receive a confirmation that your order has been placed.  Once confirmed, your order will be processed during the next day’s trading hours, regardless whether you’re in front of your computer or not at that time.

It’s a good idea to go check your order again the next day just to see if it was processed successfully.

And yes, you can be sleeping while your order is being processed.  Now, that’s investing in stocks in your sleep! 🙂

Happy investing!

Categories
Business Credit Card Investing Life Updates Money Mindset Personal Finance Personal Growth

Looking ahead to 2011

Last week, I shared my reflections of the past year 2010.  Today, I’d like to share with you my personal financial goals for the coming year 2011.  This is actually my way of challenging myself by publicly declaring my goals for the coming year.

My 3 major financial goals this year 2011

1) Create at least 3 new streams of income earning at least $100 per month each

Right now, I am still working full time at my current job as an IT consultant for a credit card company.  While I do enjoy my job, I still want to have more options.  I want to be able to one day control my income streams.  Having a job is good.  However, it is only a temporary solution to a permanent financial problem — not having enough money.

I’ve been fortunate to earn quite enough to be able to sustain me and my family and have some extra money saved every month.  The big challenge for me this year, just like in the past year, is to learn how to invest a portion of that money for my family’s future.

I don’t exactly know what the 3 income streams will be.  One thing is for sure — for this year, I’d like to focus on investing to generate more cashflow.  Last year, most of my investments had pretty good returns.  The only problem is, they were only capital gains. There’s no monthly cash flow.  This year, my goal is to learn to invest for cash flow and capital gains.  I’m considering putting up a business.  Or perhaps finally invest in a property and rent it out.  Or may be I can explore going into franchising.  I will share more to you as I get clearer on how to achieve this goal.

2) Go somewhere I’ve never been to for a week, every quarter of the year.

This is my way of growing myself.  I feel I haven’t grown that much personally and haven’t widen my horizon for the past year.  This year, I want to go somewhere I’ve never been to. Either in the Philippines or outside.  I’d like to experience and learn new things to keep my hunger alive.  I’d like be able to share exciting stories.  I’d like to be able to know what it feels like to discover and be amazed again.

As I shared last week, I was able to travel to Bohol with my wife last December.  It realy felt good just doing nothing, hearing the soothing sound of the waves while trying to relax in a hammock by the beach.  Working in a fast-paced IT and financial services industry sometimes takes its toll on my mind and body.  I feel I need to freshen up every once in a while to stay sharp and energized.

3) Weigh no more than 85kg at any time of the year.

It’s been one of my greatest struggles every year to keep my weight down.  I am getting sick quite often the past year.  I can’t go on and blame my work or my lack of time for exercise.  I know that it’s just a matter of building new habits in terms of my overall health.  Eat right. Get some exercise.

So this year, I want to be able to maintain my weight to a more manageable level — no more than 85 kgs.  It will take some time, but I’m ready for it. Let’s bring it on! 🙂

I know goals #2 and #3 don’t look like a financial goal at all.  They seem more to do with personal development than money.  I totally agree, it looks that way.  And it’s the way I prefer it.  I personally think it is very important to take care of my mind and body in my journey to financial freedom.  As I’ve described in one of my articles, your health is more important than your money.  Without it, none of your other financial riches really matter.

2011 Goals for Rich Money Habits

My goal for Rich Money Habits is to be more consistent in posting new articles — at least one per week.  As I share my thoughts to you, I gain more clarity.  The clearer I am with the things I want, the nearer I am to my goals.

Here are some of the things I’ve been thinking as I was doing some planning for Rich Money Habits this year.

– create more useful articles
– find more ways to reach out to more people
– find more ways to help you in your financial goals
– launch a product that helps you manage your money better
– redesign blog so you can navigate it easily

As you might have probably guessed, most of my goals above are still in the works.  And quite general, if you might add.  I still don’t know what exactly I am going to do.  But I think the important thing is to use these goals to remind myself what I need to focus on — helping you.  Everything else is secondary.

Cheers to an exciting year ahead!

Categories
Life Updates Personal Finance

Looking back

It’s been quite a while since I’ve posted something here at Rich Money Habits.  To begin the year right, I thought it would be a good idea to look back and share with you my reflections of the past year 2010.

Overall, last year was an exciting adventure with a lot of ups and downs, unforgettable experiences, new friends met and lessons learned. 

For now, however, I’d like to focus on how I did with my financial goals last year.  There were 3 main financial goals I listed at the start of the year: 1) Buy a house,  2) Invest 20% of my income, and 3) Be physically fit (i.e. weigh 80 kgs by end of the year).

Buy a house

 

Ever since we got back from our 2 and half year stint in Malaysia as an OFW, my wife and I have been searching for our own house.  We searched…and searched…and searched for months and months, but with no luck.  The single-detached house we are dreaming of seem too far out of reach.  The only houses that we like are either so far away from our place of work or just too pricey for our budget.

We also like a clean and peaceful neighborhood where we can walk around at night after having dinner, holding hands, reflecting about life and the blessings you received throughout the day.

One Sunday, my wife and I along with my in-laws checked out Rosewood Pointe in Taguig City, a few minutes from Bonifacio Global City.  After we looked at Rosewood Pointe in Taguig, our interest was picked.  It looked like a really nice resort!

No, we didn’t buy a condo in Rosewood Pointe. 

Better, a new project was being launched that time, a nearby mid-rise condo similar to Rosewood Pointe.  It looked promising.  We asked for a quotation on a 2-bedroom unit. It was nice and the model unit looked really great.  Of course, this is expected since it is staged but it really felt a lot like our dream house. 

Yes, it is not single detached but the ambiance felt really good.  The clean air, the playground, the walkways.  It feels great just being able to enjoy the simple things in life. Everything is relaxing and it’s not too far away from our place of work.

The rest, as they say, is history.  We finally decided to buy and pay the down payment.  Unfortunately, the unit won’t be ready until April 2012.  I know, it’s still a long time before we get to enjoy it.  But it’s ok, we’re not in a hurry.

Invest 20%

Ever since I had extra money, one of the financial challenges I’ve faced has been to learn how to invest more of the money I have.  My wife and I initially targeted 20% of our income to be invested for our future. 

Stocks

I started investing in the Philippine Stock Market February last year after opening an account with CitisecOnline.  The gains have been extraordinary so far.  My stocks are all up at an average of 22%.  Some even went high up to 55%.  I admit, this is NOT because of my investing genius.  It’s more a matter of luck than anything else. As you may have heard, the Philippine Stock Market has been in upward trend and breached all time highs last year.  It looks like this will continue on this year, so this is something I am looking forward to in the coming year.

Real-Estate

This is something I tried to get into last year.  The first deal my wife and I went into was a private lending deal on a 2-bedroom property.  My wife and I were very lucky that we partnered with a very trustworthy investor.   Our money earned quite a bit @ 1% per month for 4 months.  It’s actually a great deal compared to it sitting idly in the bank.  We would have preferred something that generated additional cashflow but getting the extra cash is nothing to complain about.  In the process, I also met a lot of great people doing real-estate investing and I hope to continue learning more on this area again next year.

Internet Marketing

Last year, I learned the intricacies of internet marketing through Jomar Hilario’s Online Mentoring Club.  This has been an eye opener for me precisely because it’s something I am comfortable with (at least the internet part).  I’ve been working in the IT industry for the last 8 years so I am comfortable with the technology side of this business. However, I practically had zero knowledge about the marketing part. 

Good thing I chanced upon Jomar Hilario’s 1 Year Online Mentoring Club.  It literally took my blog to the next level. This blog finally got an audience after applying what I learned from the mentoring club.  The great part is hearing your warm and kind appreciation to the articles.  It’s one of the reasons I decided to get back to blogging after 3 months of not posting a single article.  So, thank YOU for inspiring me to keep on blogging!

Be physically fit – weigh 80 kgs by Dec 2010.

I failed. Miserably.  I not only missed the weight goal.  I even went heavier. Ouch!  No, I won’t tell you how much I weigh now.  It’s too embarassing. 🙂

Worse, I again got sick at the end of the year.  Just when I am supposed to be enjoying my vacation.  Because my body has not been getting the rest, exercise and nutrition it needs, I suffered another attack of colds during the holidays. 

The sad thing is not being able to enjoy and celebrate with your loved ones because you are sick. 

Last month, my wife and I went to Bohol to celebrate our wedding anniversary.  Instead of enjoying the great outdoors with my wife, I was at the hotel  nursing my worsening colds most of the time.  I tried very hard to get out of bed and enjoy the Bohol tour and island hopping for my wife’s sake but it seemed it worsened my sickness even more.

A week after, I still have that nasty cold.  I know I should have gone to the doctor.  Instead, I went on a long 10-hour trip to my hometown in Ilocos.  There’s no time to rest.  I have to be home to celebrate Christmas with my parents and siblings. 

With only a few days to spare, I also had to be back again in Manila to celebrate New Year with my in-laws.  It felt like going to a mini-Amazing Race while nursing a stubborn cold that won’t go away.

My mom even kidded me that I was allergic to vacation, because as soon as I left work and went for vacation, I got that nasty cold.

This year, I feel like I really need to put some effort in protecting my overall fitness. The pressure from work won’t go away.  But I need to put in the time to exercise which I rarely did in 2010. I also need to watch out what I am eating. 

Most of the time, my wife and I are too tired to cook after getting off from work.  So we end up eating fast food.  Worse, we even call a delivery in the middle of the night. This added another extra pound into my already bulging stomach.  This has got to stop. There has to be a better way.

Rich Money Habits

Last year was really great for this blog. 
There were a lot of new things that happened. First and foremost, the year was a huge leap from total non-existence to the surge of the number of readers of this blog.  It felt really good being able to reach and help someone you’ve never met before in your life.  Some of you even expressed your appreciation by your kind comments to the articles in this blog.

The Rich Money Habits Newsletter was also born.  The 8-part Rich Money Habits article series is available fore FREE!  If you still haven’t received it, subscribe now! 

It was also the first time that I saw earnings from Google adsense.   This blog has also received affiliate income both from Bo Sanchez’  Truly Rich Club and Jomar Hilario’s workshops. It feels great to receive these blessings however small the amount.  It’s a great start.

The sad this is that I lost steam the last 3 months of the year.  I hardly written any new articles.  It was both a case of getting busy at my full-time work as well as losing motivation due to laziness.  It’s easier to just sit in front of the TV and watch your favorite show.

In a way, the past 3 months was a good thing.  It allowed me to reassess why I am doing what I am doing in this blog.  It gave me time to really focus on the things that really matter – helping you build better money habits. 

 

There were a lot more things that happened during the year but for now, I really just want to let you know that I am back.  And what better way to say that than writing my very first article of the year.

That’s it for now.  Next time I’ll tell you more about my goals for this coming year and what to expect here at Rich Money Habits.  Again, thank you for making year 2010 truly wonderful!

Categories
Life Updates Personal Finance

Happy New Year!

I would like to take this time to wish you and your family a very exciting and happy new year ahead! 

May 2011 be your most fruitful year ever, not only financially, but also in all other areas of your life – healthy mind and body, loving family and friends, rich and happy life full of meaning.

Cheers!

Categories
Life Lessons Money Mindset Personal Finance

How To Budget Your Money Without Feeling Guilty

One of the hardest problem I’ve encountered when I started managing my own money is the idea of budgeting.  I’ve tried to “discipline” myself by not spending more than my budget, but I have never been able to make it work.

When buying stuffs, I would feel really guilty spending the money that I would no longer be able to enjoy what I bought.  When I don’t spend at all, however, I would feel deprived thinking what’s the point of having money if you can’t even allow yourself to buy simple things you can enjoy.

Budgeting Ineffectively

In one of my attempts at budgeting my money, I purchased a mini notebook to jot down my daily expenses, and after the 3rd day, I forgot to bring my notebook with me to the office.  The next couple of weeks, I completely forgotten all about it.  I just went on and attempted to save as much as I can on anything and everything I can get my hands into. 

I also tried to create a spreadsheet to track my expenses but it was too tedious and it always seemed more of a guessing game than anything else.  I would guess how much I spent for this and for that.  And somehow, I would always find a way to tweak the numbers just so it would look good.    

Until finally, I discovered a neat trick that has not only helped me track my expenses but it’s so easy to implement I can do it in just 5 minutes a month.  Yes, that’s per month!  It is based from the Secrets of the Millionaire Mind book by Harv Eker which
was also described quite articulately by my good friend Jay in one of his articles.

How To Budget Without Feeling Guilty

Here’s the idea.  Create 5 separate buckets (or bank accounts if you can).  Each bucket or account would receive a set percentage for all income that comes into your life. 

Here’s what the 5 accounts look like for me.

1) FFA (20%) – Financial Freedom Account  
2) LTS (35%) – Long Term Spending         
3) EXP (20%) – Expenses             
4) FUN (15%) – Fun and Personal Growth           
5) GOD (10%) – Tithes

Whenever I receive any money either through my paycheck, or a gift, or anything, I would distribute it according to the set percentage by doing fund transfers to my other accounts.  Best of all, I can do everything in only a couple of minutes through online banking.  That’s it. 

Here’s the cool part.  After allocating my money to the different accounts, whatever is left in my ATM account would be my EXP (expenses) & FUN (fun & personal growth) for the month.  This money is supposed to be spent.  This fund allows me the freedom to enjoy and not feel guilty about spending.  The funds from my other accounts, serve a different purpose.

A Closer Look On Each Account

Before I proceed, I would like to take this time to explain my budget allocation so you can have some ideas on how you can apply it to your own situation.

FFA is 20%.  This is mostly for investments which my wife and I are not expecting to use in the short term (ie. in the next than 5 years).  Since I don’t have any debts, this fund is accumulating every month until we find a good investment we can invest on.  Once it goes in, this money will only be spent to be invested for future earnings.  It will NOT be spent away for any other reason whatsoever.

LTS is 35%.  This percentage is quite high because my wife and I are preparing to purchase our own home in the next 1 to 3 years.  We know that we would need a huge amount of money to pay for it.  The amount also includes money to pay for a car in the near horizon.  Note that this is separate from our FFA or investment accounts since our home is NOT necessarily an investment vehicle that give us a monthly cashflow, unless we decide to rent it out.

EXP is 20%.  This is where my wife and I are very fortunate. Our transportation expense is practically negligible since we just walk our way from our home to the office.  Our water expense is also not that much considering it’s just the two of us using the water.  The most we use it for is in doing the laundry.  We’ve also been able to bring down our electricity cost after limiting the use of our air conditioner. It turns out, we can actually make do with just the fan at night. I know these are just little things, but when you realize that we are saving a little amount each day, it translates to a relatively significant amount at the end of the year. 

FUN is 15%.  This is where the exciting part begins.  This is the solution to the feeling guilty part.  This fund is supposed to be spent for pleasure.  Take a vacation.  Go for a spa.  Buy a good book to read.  Attend a personal growth seminar.  Buy that cool phone you’ve always wanted.  The possibility is endless. And YOU CAN have it as long as it is from this fund.  Having been accustomed to saving for quite some time, my wife and I sometimes struggle to spend the money away.  Strange I know.  But sometimes, it feels like you want to get more out of it.  It’s no longer the material product that you want, but the experience.  That’s why my wife and I have been planning more vacations lately to go to places we’ve never been to before.  Nothing too fancy or expensive. Just the thought of learning new things to keep the hunger alive.

GOD is 10%.  This is one area I am still working on.  I’d be honest.  I sometimes feel like 10% is too much.  Other times, I feel I am not giving more.  At this point, the fund is still accumulating.  This is actually one part I’ve been wanting to put some time planning on.  Maybe I’ll throw everything in in one go someday.  I need practice to give more.  Maybe I’ll just take one day at a time.  Being generous with my money is still something
I’m relatively new at.

This budgeting strategy is really simple and easy to do.  However, keep in mind that this is just a guide.  You can change the allocation to cater to your own situation.  For example, if you have some debts, you use all your FFA savings to pay for your debt.  Your freedom day would be the day you completely pay off all your debts.  If you haven’t saved for emergency fund yet, you can also use the FFA to fund it for you.  Note that it is money that should NOT be spent any other way.

If you are living on 110% of your income, try to make more money so you can save some.  Or save on things you would not necessarily need so you could at least bring your expenses down to 90% and allocate the 10% to your other accounts.  In any case, start with something.  There’s nothing stopping you to make your dreams a reality.  But you do have to take action.

That’s all for now.  Enjoy budgeting your money without feeling guilty. 🙂

Categories
Life Updates Money Mindset

Rich Money Habits is joining the Yakezie Challenge

Today is a great day for Rich Money Habits.  This marks the day that I am joining the Yakezie Challenge.  I came across the Yakezie Challenge a few months ago after my guest post “5 Money Habits I Learned That Will Never Make Me Rich” was featured at financialsamurai.com.  I thought about joining then but hesitated because I felt I wasn’t ready to take the challenge on just yet. 

What’s the Yakezie Challenge

”The Yakezie is an exclusive network of the finest personal finance and lifestyle bloggers in the world.  It was founded by Sam of financialsamurai.com in the hope of creating powerful friends and becoming an influential bunch of personal finance bloggers.  The Yakezie Challenge is to get your personal finance blog’s Alexa ranking to the top 200,000 in 6 months.  Rich Money Habits is starting at a rank of 1,079,182!  Yes, that’s 1 million ++!  Didn’t I say this is a challenge?! 🙂

Why am I joining the Yakezie Challenge

There are several reasons why I would like to join but mainly I just want to reach out to other personal finance bloggers out there.  One thing I realized while writing my Top 10 list of the emerging influential blogs of 2010 is that I didn’t know many of them.  This is an opportunity for me to reach out and become more involved.  Other than that, here are a few more reasons why I am joining the Yakezie challenge. 

1)  Personal challenge

Getting the Alexa ranking from 1,079,182 to 200,000 in 6 months won’t be easy.  It will definitely stretch me to do things I’ve never done before.  Until today, I’ve been content watching by the sidelines, minding my own business.  I think it’s time to challenge myself even further and truly commit to making this blog better and achieve a higher Alexa ranking.

2)  Be part of a great community

Blogging can sometimes be a lonely journey.  Most of the time, it’s just me facing my laptop and typing away at the keyboard.  Yes, there’s the occasional comment every now and then (which is great) but nothing beats being able to bounce ideas with other people with similar interests as well.  I think Yakezie network is a great community to be part of and a great venue to do just that.

3) Expand Rich Money Habits’ network

Being in the Alexa top 200,000 will bring a lot of benefits to this blog.  Traffic of course will be the main thing.  It means this blog will be able to reach out to more people.  More people will benefit from the interesting articles and the amazing products Rich Money Habits recommend.  Of course, that will also translate to more opportunities and income from this site, which is also nice.

That’s it.  I have a long, long, long way to go to get to Alexa ranking 200,000 so I better get started right away.  Wish me luck! 🙂

 

P.S.  Care to join me in this new challenge?  Join the Yakezie Challenge now.

Categories
Life Lessons Money Mindset

Launching the Rich Money Habits Newsletter – 8 Ways To Shift Your Money Habits and Be Rich

“Join my Rich Money Habits Newsletter mailing list and get your FREE issue of the Rich Money Habits 101 Series: 8 Ways To Shift Your Money Habits and Be Rich!” 

8 ways to shift your money habits and be rich coverDiscover the 8 secret money habits that have personally helped me

 – get out of debt

– save for emergency fund, and

– start investing for my family’s future

Today, I am writing to you from Island Cove Resort Hotel in Bacoor, Cavite, Philippines, about an hour drive south of Metro Manila. My wife and I are taking our much needed vacation to spend some quality time after a year of working so hard and not getting much rest. 😉

Before I consume too much of that vacation time, I wanted to let you in on a major project I have been working on the past couple of weeks.  My project is aptly titled “Rich Money Habits 101 Series – 8 Ways to Shift Your Money Habits and Be Rich.”

For the first time ever, I will share to you the secret money habits that have personally helped me get out of debt, save for emergency fund and start investing for my family’s future. 

I don’t claim to be a personal finance expert (disclaimer) so you should take whatever I share with a grain of salt (or pepper, whatever you like =)).  You have to filter out what’s practical and applicable to your own situation.  I am just a regular guy who went through (and may still be going through) the same money problems that you may be experiencing right now, sharing the money habits & tips that have helped me solve some of those problems.  My only wish is that the simple money tips and experiences I share help encourage you in your journey to financial freedom.

Unknown to many, some of the subscribers of this blog have already gotten a taste of the 8 secret money habits I mentioned above.  Here’s one of the subscribers has to say about the Rich Money Habits Series.

“Good evening Mr. Allan. I just read your article, it’s great! I really like your writing style, good flow, well organized…” – Anthony

If you want to find out what Anthony has discovered, sign-up to my Rich Money Habits Newsletter now!  It’s totally FREE!

Categories
Books

Book Review: The Instant Millionaire by Mark Fisher

A couple of weeks back, I received a review copy of Mark Fisher’s book “The Instant Millionaire: A Tale of Wisdom and Wealth” from Kim of newworldlibrary.com but due to busy schedule, I’ve only been able to write a review just now.

Before I say anything else, please note that I am not being paid for this review.  However, I did receive the review copy of the book for FREE which is great and if you click the picture below, and buy the book from amazon, I would earn a little affiliate income.

With that out of the way, the book Instant Millionaire, is a fable (short story) of a young man who wanted to be rich and seek out to learn from an old rich man they call the instant millionaire.

The_Instant_Millionaire_Mark_Fisher

The 3 ideas that struck me most when I read the book

1.  The Power of Words

There’s this one scene in the book where the master was demonstrating how powerful words really are, especially the words that we tell ourselves.  The scene describes the young man screaming for help in fear of losing his dear life, simply because he read a few words on a computer screen and put meaning into those words and made himself “believe” that his life was in danger even if it was actually not.  Words are just words.  But the meaning we put into those words spell the difference.

2.  The Power of Stories

What I liked about the book is that it was written as a short story.  The book is an easy reading.  I managed to read the book from cover to cover in just one sitting.  I don’t know if it’s just me, but I learn more when I enjoy reading.  And reading a good story captures my imagination even more powerful than just a list of bullet points from a powerpoint presentation.

3.  The Power of Habits

The term instant millionaire is a misnomer because in the story, the young man mapped out a plan to be a millionaire in 6 years!  I don’t think many people would consider 6 years as instant!  In reality, most overnight successes are actually long, long years of preparation.  We only see the success, but we fail to go behind the many long hours of frustration and self-doubt before that.  Success is a product of a lifetime of great habits coming into fruition.

Who should buy this book

  • those who want to read a good old short story of having a rich money mindset
  • those who loved reading the classic “who moved my cheese” and probably want to read another fable to entertain and make them think about life again
  • those who are looking for a different way of thinking about money

Who should NOT buy this book

  • those who focused on the word “instant” in the title and looking for a get rich quick scheme
  • those who are looking for a specific step-by-step how-to instruction guide on getting rich
  • those who want to become an instant millionaire and don’t want to pay the price

Overall, this is a good short story style reading book you can finish in one sitting.  It does not really get into the nitty-gritty and how-to stuffs of getting rich but if you’re looking for an easy way to learn to think like a millionaire, this book is a good start.

P.S. Want to have your book reviewed and your story featured here at Rich Money Habits? Contact me.

P.P.S. Want to hear more about book reviews in the future, subscribe to Rich Money Habits now!

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