I bet everyone would say, “Yes, I want to be rich.” But that’s really just easy to say. If you give that question a follow up and ask “What have you done to become rich?”, you would probably get a good number of “Uh, ano bang kailangan gawin?” answers. Two years ago, I sat in one of Colayco’s seminars on Piso-bilities, and I think there was another one I attended that has a similar theme (they were given for free for separated employees). You see, that’s my problem, I forget things. I forget even the good lessons I learned. And I guess that’s everyone’s problem too. It’s easy to forget if you don’t apply them. And because of the emptiness that my bank account has long been feeling, I decided that I need to do something to fill it up. So to start, I attended Bo Sanchez’ How to be Truly Rich seminar. It was just the refresher course that I need. To be honest, the messages there weren’t new to me. They were the same words I heard 2 years ago in those free seminars. And there were a lot of notes that I already knew. But I still had to hear it again from someone, so I could really absorb it, even if I had to pay a small sum just to remember it.
How money works
The biggest lesson I learned about money is that we shouldn’t work for it, instead, we should let money work for us. It’s a mindset that a little hard to achieve in this corporate environment that teaches you to work because you need money. Investments and business were virtually limited to the rich and the risk-takers. But times have already changed, and because people are more financially literate nowadays, opportunities are now better seen (and hopefully grabbed) even by risk-averse people like me.
One of the simple tools taught in the HTBTR seminar was how to compute your net worth. It’s as simple as computing what you have (assets) less what you’re obliged to give (your liabilities) and tada! That’s what you’re worth (at least financially on paper). If you’re surprised to know that you’re not worth much, then, that should be your sign to take the 1st step in getting rich – which is saving.
I’m not going to pretend and say that I’ve really put these lessons I learned to heart, because I really haven’t. I’m a work in progress, but while being so, I’ll make a little good deed by sharing a few tips I learned:
Tip#1: Know the formula
Most of us follow the wrong formula in saving: Income – Expenses = Savings. That’s because it’s easy to know how much you have to spend than how much you’re supposed to save. But as hard as it may be, we have to apply the right formula for us to get the right results:
Income – Savings = Expenses
Tip#2: Let go of your baggages
Start paying off debts. I know, that’s really hard if you’re already best friends with your credit cards and you’re living by your paycheck. But we’ve got to start paying those debts and start separating ourselves from those ever-reliable plastic cards. Pam, my officemate, told me before that I should set my Freedom day – that means plan out how you’ll pay your debts and set a date on when you’ll finally clear them all up.
Tip#3: Change your lifestyle
When you earn a lot, you spend a lot. Take yourselves back to your 1st job when you were earning probably only 20-50% of what you’re currently getting now (depends on how long you’ve been working, it may just be 5% for the oldies :P) When you weren’t getting much, you had to stick to your budget. You were better in judging needs vs wants. Of course, you ought to reward yourself for every good job you’ve done. But for once, try sticking to your budget and saving (or investing) that increase in your paycheck.
Tip#4: Expand your wallet.
Don’t put a limit to what your virtual wallet can accommodate. Don’t think you’re only supposed to get this much, and that you’ll never afford those goods things. This may seem contradicting to Tip #3 which asks you not to spend much. But don’t confuse yourself, you should believe that you’re going to receive more, that you’re going to be rich, but don’t spend what you’re not yet getting. Just believe that you can afford them (and then you will in time).
Tip#5: Be friends with the rich.
No, this doesn’t mean that you should be a socialite (or just a climber). Remember, the key to this success is all in the mind. You have to change your mindset, and being around people who have already achieved that would surely help you. Or just be around friends who can help you and give you tips on how to manage your money well.
And because it took so long to write this blog about the How to be Truly Rich Seminar, I have already attended another seminar by Bo, How to Make Millions in the Stock Market. For those non-Finance people, this is a simple easy-to-understand seminar on how the stock market works and how you could be a part of it. I’m not going into the details of this one, as I have not been able to get myself into the stock market (but I am planning to this year). It really helps to learn this stuff from other people. I just hope the lessons will make rich and won’t be forgotten J
