Rich Money Habits

Over the years of coaching a lot of would be entrepreneurs, I realized one thing that I think is the #1 reason why people don’t become rich. Most people think that to become rich all you have to do is earn more income. But only a couple of months after getting a promotion, or getting a bonus, however, most people still end up living day to day. They are no better off than before they got promoted.

Here is the brutal truth. More money won’t make you rich, if your problem is you don’t know how to handle your money.

The scary part of having more money is that it reveals how good or bad you are in managing your money. Money has a way of magnifying things. If you are having problem handing little money, more money will only compound your problem.

Have you read stories of people who were once broke and then suddenly won the lottery? After a few years, they end up more broke and more in debt than before they won the lottery. Strange isn’t it?

If you have plans of starting your own business, the #1 skill you need to learn is how to manage your money. I won’t recommend you do investing when you are heavily in debt. If you are in that situation, the first thing you need to do is to get yourself out of debt. After that, you have to be able to set aside money for emergency situations. After which, you can then move on to setting aside money for increasing your investment portfolio.

Earlier this month, I have had the privilege of learning from one of the Philippines’ sought-after financial coach, a registered financial planner and author of the book ‘No Non-sense Personal Finance’, Randell Tiongson as part of our team’s 3-day retreat.

Over the years, I have had the chance to share the same principles in my team through my financial literacy talks. I feel strongly that more people should learn these things so that they are better equipped in handling their own money. I know how it feels to be in debt. I know how it feels to not being able to save up for emergencies. I know how it is to get confused in the myriad of advise on investments. That’s why, it has become my mission to guide people starting in their business how to manage their money well so they won’t fall deeper into debts, hoping that one day, they will reap the harvest of their hard work just like what happened to me and the leaders in my organization.

Basics of Financial Literacy

Depending on where you are currently in your finances, here are some things you can use as your guide in your own financial journey.

1. Get out of debt. This is a huge topic all-together. Some people use credit card as if the bank gave them a bonus.  They act as as if the credit limit given is money they actually own. Worse, some use this as their “emergency fund.” Always remember that the rule of the game in the world of money is, “who is indebted to whom?”. As the saying goes, “the debtor is the slave of the lender.” When you really think about it, this description is quite accurate. Have you observed how people who have debts behave on social situations? Their self-esteem takes a hit. They feel ashamed not being able to pay off their debts. Something deep inside them starts to feel inferior. It is more than the money that is eating away inside of them. It is their soul. It is their confidence and self-worth. With this, it is imperative then that you get out of debt as soon as you can. This is specially true for retail debts like credit cards or personal loans. If you own several credit cards, your goal is to pay-off one card at a time and only pay the minimum on the others. The sooner you can pay-off one credit card, the sooner it will be for you to gain back your confidence and momentum. That’s what people call “snow-ball” effect, that after paying off one card, soon the habit you formed will allow you to carry it on in paying the next card, and so on, and so forth. You can apply the same technique in paying off personal loans from other people.
2. Save for emergencies. Most people have only one source of income, their job or their business. In the event that this stream of income suddenly stops, they get into financial trouble. One must be able to prepare for this event. Financial experts recommend having at least 6 months worth of expenses. The reason for this is because it normally takes around 6 months to be able to replace your stream of income, either by finding another job or setting up another business. Have you tried saving for emergencies, only to experience an “emergency” a few months after and at the end of the year you are still no better of than when you started? Still no emergency fund saved. The trick that I discovered in saving off for emergency fund, is to make it very convenient and hassle-free to deposit money into your fund, and very inconvenient to withdraw money from it. In my days as an employee, we had this savings and loans association where they automatically deduct a percentage of your salary into your savings account. I never saw the money. In fact, it never reaches my ATM account. To withdraw, I would have to fill out several papers and I only have a 30-minute window on specific days to be able to do it. The extra hassle is enough for me to just leave the money out there. I’ve applied the same thing in my business. Once money comes in, I automatically transfer them to my different accounts including the one for emergencies. My mentor described the emergency fund as “peace of mind” fund, because it’s supposed to give you peace of mind.
3. Grow your money. Once you are able to save for emergencies, that’s when you will have the confidence to venture out and explore other options to grow your money even more. We all know that you will not earn a lot when you leave your money in the bank. In fact, you are actually losing money if you take into account inflation. Inflation is when the price of goods rises every year. This is around 3% to 4% on the average. Savings accounts on the other hands rarely give more than 1% interest. You are on the losing end. The only reason you leave your money in the bank is for liquidity reasons. Because you can withdraw them anytime because of emergencies. If you want to grow your money, you are better of putting your money in investments. There are several ways you can invest. Personally, I have tried investing in real-estate, retail treasury bonds, stocks, insurance, and business. Each one is not better than the other, it depends on your particular goal at the moment. Obviously, if you ask a real-estate agent, he will say investing in real-estate is the best. If you ask a stock broker, he will say you should invest in stocks. If you ask a businessman, he will say you should invest in a business. For an ordinary employee like me before, it is quite confusing to receive different advice from different people, but one thing that has helped guide me in my journey, whether to listen to a particular advice or not is this, “every time you buy into someone else’s opinion, you are also buying into his lifestyle.” Ask if the person giving out the advice is personally investing on his or her own recommendation. If not, better to turn around and ask someone else. If yes, then get to know the person’s values and character, as well as the lifestyle that he has. Is he living the lifestyle that you dream about in the future? If yes, then listen to him. If not, you might be better of doing business with someone else, you share the same values with, and someone living the lifestyle that you want to be in the future.

These are just basic tips for you to get started in your financial journey. It has been more than a decade since I applied these same principles in my finances, and it has carried me well enough for me to be able to quit my 9-year IT career in 2011 and live the life of my dreams. I can honestly say, yes it is possible. It is not easy, but it is not to0 hard either. There are people willing to help you along the way. All you have to do is to make your own decision to take the leap of faith and follow the small voice within you yearning to have your own freedom. There is greatness within you. Unleash it this 2017. Cheers to your success!

If you are like me, you have already realized by now that relying on your paycheck alone won’t give you the desires of your dreams. Want proof? Let’s say you are a young family with 2 kids. You and your wife both have a stable job with a promising career. You have BIG DREAMS for you and your family.

In the real world, here’s what’s that look like:

1) HOUSE & LOT (P5M) – You want to have a HOUSE & LOT. What do you say is a reasonable amount for a house and lot? P5Million? P10Million? more? Of course some would argue that they can live in a simple house, preferably in the province…or just outside of metro manla. The thing with having a home away from your work place is you would need to increase your spending for transportation.

2) CAR (P1M) – Let’s say, since you want a comfortable ride for the whole family, you want to buy a decent car. That will, be around P1Million, not including parking, toll, gas, maintenance, insurance, and more.

3) TRAVEL (P2M) – You also want to travel and bring your whole family to a beach vacation in Boracay or overseas at least once a year, so let’s say you want to do it for at least 10 years, that will amount to P200,000 x 10 = P2Million pesos.

4) SAVINGS (P5M) – Of course, for any emergencies you want to have the peace of mind of having SAVINGS…say P5Million. If you want more, you can always add more for you. 🙂

Total all of the figures above and you will get the PRICE of your DREAMS. In this example, that is going to be P13Million. That’s only for a decent living with basic expenses. Certainly not at a luxurious level yet.

The #1 reason most people don’t achieve their dreams is because they don’t know how much the price is. If you are still reading up to this moment, you are way ahead than most people because now you know HOW MUCH IS YOUR DREAM.

Now, the next question you will have is HOW WILL YOU CREATE THE P13Million?!!!

Would you let me give you some ideas you can consider?

1) You could become a celebrity. Become an endorser for a commercial in TV. 🙂 We all agree that celebrities earn a lot from endorsements. P13Million will be a piece of cake if you are a sought-after celebrity like Piolo Pascual, Sarah Geronimo or the like. But not everyone is cut out for the intrigues in showbiz. That’s why I didn’t even try. I want a peaceful life. Hehe 🙂

2) You could marry someone rich. For some people that’s their basic strategy in becoming rich in life. Obviously, there’s a lot of pros and cons to that. But, living with someone for the sake of money may not be the best use of your life. You only have one life to live.

3) You could become a famous athlete like Manny Pacquiao or a basketball start like James Yap. Did you know the minimum wage of a basketball player in the professional leagues is around P50,000/month and the maximum is around P425,000/month. Not bad! But we all know the life of an athlete is plagued with a lot of risks. What if you injure yourself, what if you get cut, etc etc. Not to mention that you would need to start at a young age to train just to be able to compete.

4) You could become a businessman. Did you know majority of millionaires are entrepreneurs? But we all know the world of business is not for everyone. 9 out of 10 businesses fail in the first 5 years. Of those that survive, only 1 out of 10 make it after 10 years.

5) You could do nothing and stay where you are. In most cases, as an employee you would have to rely on your paycheck to earn the P13Million.

Now let’s take a closer look.  Let’s say for example that you are able to save up at P10,000 a month from your job. In 1 year, you would have saved P120,000..after 10 years, that’s P1.2M, after 20 years, P2.4M…and by the time you reach the retirement age of 60 (after 40 years of working), you would have saved a total of P4.8Million pesos. Let me give you a moment to digest the last figure one more time. P4.8Million after 40 years of working. All your life, you did as you were told. Never made any scene. Stuck to your job and worked…so hard, only to get this in return. P4.8Million in 40 years.

Here are some things that you will soon realize.

1) The P4.8Million you saved is nowhere near the P13Million you need to buy your DREAMS. In fact, it’s not even enough to buy your DREAM HOUSE OF P5Million. Even if let’s say you are able to save the additional P200,000 to reach the P5Million price, do you really think the price of the house is going to still be the same after 40 years? The answer is definitely not. There is such a thing called inflation.

2) Some people would argue that the P10,000 can increase after some time since you can get promoted. At first glance, you would think that makes sense. In real life, it doesn’t happen that way. After a promotion, an upgrade in lifestyle would soon follow. What used to suffice is no longer appealing. Of course, a manager or a doctor would have to look the part of a successful or a newly promoted professional. Buy new clothes, new gadgets, and eat out at new more expensive restaurants that would align with their new image or lifestyle. This is what some people call as keeping up with the Joneses. So even if the salary increases, the expenses increase as well. Nothing is still saved up.

3) Everyone who have been working for at least 5 years already know this. It is NOT ENOUGH. In fact, when you ask an employee, what they will do after retirement, almost all will say they will put up a business. Surprisingly, famous athletes go into business after their playing days are over as well. Even celebrities go into business just the same. Everyone know relying on your paycheck is NOT ENOUGH, and adding income by starting a BUSINESS is one of the most feasible options you can have. Why? Anyone can enter a business. Today, anyone with a mobile phone can do business. With the power of the internet, this has become possible.

Why then are people still not starting a business?

Lack of capital. I don’t have money to start a business.

Lack of knowledge. My father was an employee. My mother was an employee. Everyone I know is an employee. Who will mentor me to start a business?

Lack of resourcefulness. What if I fail? What if I lose money? What if it doesn’t work?

Fear of what other people will say. What will other people think of me? What if everyone will ridicule me? What if I become an embarrassment to my clan?

There are so many reasons why starting a business is not feasible for you. But always remember, you only need one reason why you can make it a success.

So what if you don’t have money? Can you borrow capital from someone who trusts you? It’s not a question of having resources…but of having RESOURCEFULNESS.

So what if you fail? At least you tried. Those that do not fail are not doing anything at all.

So what if you don’t know how? You can always ask. Google. Act. Fail. Succeed. Learn. Repeat.

So what if people will ridicule you? They do not own the DREAMS in YOUR HEART. You alone will look in the mirror at the end of the day and say, you made it.

The journey of a thousand miles begins with a single step. My journey has been like that for the last decade. After realizing I need to make some changes, I simply closed my eyes and got started. I started a business part-time, struggled to get it off the ground. I failed many times. Got rejected. Discouraged. Got up again. Licked my wounded ego. Moved on. Eventually, I was able to quit my 9-year IT career to grow my business full-time. Now it’s been more than 5 years since I quit. Never have I felt more free to DREAM and pursue the things I want in life. The next 5 years is going to be very exciting. The DREAM is still alive. 🙂 I hope you find the courage within you to pursue your dreams as well. There’s help on the other side when you decide to make a change in your life. 🙂 Cheers to your success!!!

P.S. In my next article, I will share you the one thing you need to know before you start your own business.  If you don’t learn this, starting a business will get you further in debt instead of earn you additional income.

P.P.S. I’m expanding my business and currently looking for partners. Only 4 slots left. CLICK HERE to learn more.

This post was inspired by Fritz’ How To Turn Your P50K to P1Million in less than a year. While it’s certainly possible to earn your first million in less than a year, more often than not, those who are able to achieve the feat have had years or decades of preparation. It only seems like the success was overnight, but just like what the Pokemon Go creator said, it took 20 years to create an overnight success. 🙂

The vast majority of people who are exploring for ways to earn apart from their jobs are just starting out, clueless to the options out there, afraid to try and fail. I know, because I was once in a similar situation.

Growing up I was always a busy kid. I worked hard earning extra money, taking care of pigs, chickens, planting vegetables on our backyard, going with my mom and dad to harvest tobacco leaves as well as cleaning our neighbour’s house for a fee.  My idea of earning an income was tied to having a job. Around 2003, I read the famous book Rich Dad Poor Dad by Robert Kiyosaki. For the first time I was introduced to the world of entrepreneurship and the possibility to earn not just once from you hard work, but multiple times. I was surprised to learn about the concept of LEVERAGE and RESIDUAL INCOME.

That kicked-off my journey towards searching for ways to earn extra income apart from my job. I have tried to setup businesses after that but it was all a one-man show. At the end of each business, all I had to show for were BIG eyebags from lack of sleep, bruised ego and empty wallet. That’s when I realized, if I was every going to make it I’d better learn how to build a TEAM. As they say, business is a TEAM sport. Teamwork is very important.

After working abroad for more than 2 years, I finally came back to the Philippines for good. It was at this time that I was able to save enough money to be able to invest in different things. I dived into stocks investing, real-estate investing, bonds, insurance, mutual funds and other paper assets. While everything was fine with me, part of me was still AFRAID. I knew deep down that in reality I really didn’t have CONTROL over how my investments would turn out. I longed to be able to learn how to BUILD A BUSINESS that I can CONTROL. This is important for me because when I was abroad I witnessed how a recession can turn a seemingly comfortable life upside down. There were tense moments where every day a few of my colleagues were being let go. Every day I was worrying whether today is going to be my turn. Fortunately, I was able to wither the storm as they would say. I was not let go, but that experience taught me a great lesson on being prepared. People say, if cars have spare tires, why not you? Aren’t you more valuable than the car?

Over the years, I have read hundreds of books and videos online or from the bookstores. If you see me at the mall I only visit two stores – the bookstore and the sports store. 🙂 When I came back, I attended lots of seminars from Bo Sanchez and other experts in business and marketing. That’s when I tried to make a goal to earn my first $100 through this blog. It took me around 1 year and 6 months to do it. I’m not sure if anyone is still using Google Adsense, but it was a fun time to be learning about internet marketing then. I was able to cash out the $100 and I was so happy. That proved to me that it was really possible to earn online.

My second attempt was in creating my first ebook Rich Money Habits – 8 Ways to Shift Your Money Habits and Be Rich. That ebook was sold for around $9.95 and all the orders combined after a few  months amounted to $605, of which the first $100 was earned in its first week after launch. The experience taught me a lot of things. Today, I have stopped selling the ebook and decided to GIVE IT AWAY INSTEAD FOR FREE! Simply visit my website at http://www.allaninocente.com/ and enter your email to download your free copy.

In 2011, one of my friends in real-estate shared me another opportunity that would multiply my earnings from $100 a week to $1000 or more in a week. She became my business mentor. She has been featured in Kerygma magazine as a former SM saleslady turned Millionaire missionary. Her inspiring rags-to-riches story has been featured twice in a TV show Asenso Pinoy shown in Studio 23. Through her mentoring, my results eventually improved…and the rest as they say is history.

It initially started out as a part time thing, until it surpassed my one week income from my job after 6 months. That’s when I decided to give it more time and quit my 9-year IT career to earn full-time US dollar income to support my family. In the last 5 years, my wife and I had the best times of our lives: We were able to buy our first car, a Chevrolet Cruze, and another family car, a brand-new Chevrolet Trailblazer. We also got our 2-bedroom condominum unit in a Resort Style Residential Development by DMCI properties. My wife and I experienced all-expense paid Asian Cruise travel twice: the first one to Hong Kong, Sanya China and Vietnam via Star Cruises, and another one, a 7 days 6 nights unforgettable experience via Royal Caribbean Cruise to China and Korea. There are other travels to El Nido Palawan, to Marina Bay Sands Singapore, Beijing China, and many many more.

In the process of building our business, I have had a chance to mentor other people to achieve the same results as well. Some of them are Engineers, Certified Public Accountants (CPAs), IT professionals, and more. Most of them have also been working in the corporate world, but eventually realized that it is not enough. You can learn more about them and their stories here.

In the end, this is simply my story and other stories of people who were just looking to earn an extra $100. Life had offered so much more for those who were willing to learn, be coachable, work hard, and dream big for their families.

TODAY, it’s your turn to WRITE YOUR OWN STORY ON HOW YOU EARNED YOUR FIRST $100.

Here’s my good news for you. I am currently expanding and building my 6th business center…and in the middle of building a 10-man team. There are only 10 slots available. Bad news is, 4 slots have already been taken. There are only 6 slots left. I receive 15 – 20 inquiries in a day so it’s possible all 6 slots can be taken by end of this week. If you would like to work with me, and allow me to help you earn your first $100 this week, simply go to my website now at http://www.allaninocente.com/ and FOLLOW THE INSTRUCTIONS listed to take the first step. I’m very excited to be working with you and make your initial $100 goal come true. Cheers!

This article is a featured guest post from Louren of Powepinoys.com. I have come to know Louren’s work and realised that we share a lot of things in common; one of which is to share to our readers the value of starting a business! Today, he is going to share the 5 Common Fears you Need to Conquer in Starting a Business. Read on and enjoy!

It has been a common topic of conversation for people in the corporate world to talk about what business are they going to put up for their retirement. Many people get excited when they talk about these things especially the idea of having a money that works for you. Exciting as it may seem, still, not all people are exerting efforts to actually put their business ideas to life. Why? That’s what we’ll be talking about in this post.

I just finished packing for our upcoming trip to Singapore, but I am so excited about this discovery I want to share it with you before I go on with my trip.  I’ve been to Singapore many times already. At least 4 times when I was still working in Malaysia, friends and family would visit me and my wife and we would accompany them to visit Singapore for a couple of days.

When I shifted my career from IT to entrepreneurship, I now visit Singapore for business. The first one was to celebrate one of my friends’ promotion to one of the leadership positions in our company. During my short stay, I got the chance to meet and share my story to OFWs who were also aspiring to become entrepreneurs. The last time I was in Singapore was around this same time last year when we received an award as one of the Top 25 Highest Income Growth Earners in the whole Pacific Region for our company.

This time we are going to Singapore once again. We opted to stay for a little longer to enjoy and have fun in Singapore. I’m also excited because one of those I met in through this blog 5 years ago are going to be awarded on stage this week. They have completed their project of earning $2,000 (USD) per week for 4 consecutive weeks. It’s going to be 7 days of fun and excitment being with my friends and teammates.

A lot has changed in the last 5 years. If I hadn’t gone into business, most probably it would be an uphill battle to get approval for vacation leave for my 7-day Singapore trip considering that I have 2 or more week-long trips again in the next coming months. Here’s our team’s group picture in Universal Studios Singapore last year.

One thing that excites me about travelling abroad is I get to meet people from different countries. During the week I will be attending our company’s Asia Pacific Convention. It is another chance to meet and greet old friends as well as meet new ones from other countries like Korea, Japan, Hong Kong, Australia, New Zealand, Malaysia, Hong Kong and more. Last year, one of my friends from Australia, a Gen Y leader himself, shared this amazing comparison on what excites people from different generations: Baby Boomers vs Gen Y/Gen Z (Millenials?).

This is an interesting comparison on what excites different generations. Baby boomers are people who were born in 1946 to 1964. This is right after world war 2. The soldiers went back home after the war and there was a population explosion. One billion people in one generation.  This generation, is one of the biggest and they control a third of the world’s wealth. Generation Y are people who were born mid 1970’s to 1994 while Gen Z are born 1995 to 2012. These is a contrast between old and new generations.

I can definitely relate to most of those in the list for Gen Y. Now, I can understand why people think Gen Y are lazy. The reality is that Gen Y know your brain is an asset and you should think of way to achieve the same outcome faster, cheaper, easier.  That’s working smart. 

I also like to travel. In fact, back in 2011 I made a goal for myself to travel to a place I’ve never been to every quarter of the year. While I have travelled a lot over the years, this is something that I would like to experience more of in the future. It’s always a good idea to find a job where you would enjoy doing instead of slowly losing your passion for living in a job you don’t like just for the sake of earning more money. It’s also a big plus to be working in a business where you have the flexibility and control of your own time. No need to file for leaves. No need to hurry getting back to a pile of workload. With how the system works, I sometimes experience earning even more while I am on vacation. 🙂

One of the reasons I shifted my career to business was because I no longer feel that I was growing in my job.  I felt like I was just going to the office, put my 8 hours and then go home. Nothing to look forward to. Nothing to be excited about. I was slowly losing my soul.

The first few years in my job, I was very excited to learn. After 9 years of doing the same thing over and over again, I felt bored. The pay was good, but I felt like I wanted more out of life than merely earning an income. I felt there’s an exciting world out there. There are so many things to explore.

Exploring entrepreneurship felt like an exciting new frontier for me. Everyday was a learning experience. New people to meet. New ideas to master. New books to read. New places to go to. It’s been a wonderful experience being in business. It’s not without challenges, but I can never say it is boring. 🙂 Everyday is a chance to learn something new.

I am a LEARNER by heart.  I love to tinker with things. I love to explore and learn as much as I can.  That’s what excites me every day.  That’s why one of the things I loved doing in the past was reading other blogs about money. That’s why I was delighted to learn this amazing news a few weeks ago.

This blog, Rich Money Habits by akosiallan.com was included in the Top 40 Business Blogs of the Philippines according to apexgloballearning.com. I feel honored to be in the same list of some of the best business authorities and blogs in the Philippines like Entreprenuer, Go Negosyo, Money Sense, Pinoy Money Talk, and more.

It brought me back to where this blog started more than 5 years ago. I wrote the articles in this blog primarily to share my discoveries about money to the world.

Most of you, I will not have the chance to meet. Through the articles in this blog, I hope it will help you in your financial journey.

My dream is to hear your personal story one day, and get to share in your discoveries too. This world is a magnificent place to discover so many wonderful things.

Now, it’s time for me to explore and learn from Singapore and the whole world!

P.S. If you’re based in Singapore and you would like to meet me up in person, you can message me through my Facebook Business Page @ http://www.facebook.com/allaninocente111. See you there!

P.P.S. I’m still looking for 10 people who would like to be part of my newest project. Part-time or full-time are welcome. Earn in US dollars. 2 slots have already been taken. 8 slots left. CLICK HERE and let’s connect!

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