Millionaire Acts

Finding Your Passion

Tyrone — Sun, 08 Nov 2009 03:45:06 +0000

Passion is where your heart is. It is where your interests and skills thrive. When you have a passion for things, you tend to do better at those. Finding your passion is the key to success in all your endeavors.

If we compare Rich Dad vs. Poor Dad, Poor Dad’s slogans are the words of fear; Rich Dad’s slogans are the words of passion. While fear reflects disappointment and passivity, passion reflects confidence and energy. What builds wealth isn’t fear, but passion. Sometimes it is called a strong business mission.

Let’s take for example the story of Robert Kiyosaki on how he found his passion for his business.

In 1977, Kiyosaki launched a manufacturing company that was one of the first to make nylon and velcro wallets. The company’s growth was meteoric, but stiff competition soon forced him to move its manufacturing operations to southeast Asia. When he inspected its new overseas factories and saw the cruel conditions under which people were forced to work, it drained some of his passion. He no longer wanted to become rich if it meant exploiting low-paid workers. His business began to sag as his interests and passion decline.

His Rich Dad recognized that his enthusiasm for the company was gone. “Let the manufacturing company go,” he advised Kiyosaki. “It’s time to build a business around your heart—around your passion. Have a strong business mission.” At that point in time, he knew what that passion was teaching.

So in 1985, together with his wife Kim, they packed up everything they owned and moved to California to start an educational business based on exciting new teaching methods. It quickly depleted their savings and exhausted their credit cards. They lived in the basement of a friend’s house. Uncertainty and self-doubt plagued them. However, they both knew what they wanted—financial freedom—but they didn’t know if this new business would enable them to reach that goal.

Despite their fears, they followed their hearts and kept on, and in less than five years they already had a multimillion-dollar business with eleven offices throughout the world. They had built a business around a new approach to education, and the market loved it. Their passion for the business and its mission made it happen.

Do you know what your passion or mission is? Many people don’t, and they have a hard time finding it. To find your passion or mission you have to dig deep inside. Here are some questions Kiyosaki suggested to get you started:

Are there any activities or thoughts that absorb you so thoroughly you lose track of time?
What subjects do you find most exciting to talk about?
Who are your heroes? What is it about them that you admire and want to emulate?
Do you have any skills or talents that inspire self-confidence and pride?
When you have a free afternoon, how do you choose to spend it?
If you had all the money you needed to pursue a hobby or a special project, what would it be?
Do you subscribe to magazines or read books? What sort of reading material excites you?
If you could develop a “dream” business for yourself, what would it be?

It may help to talk about your passions with people whom you know well and trust. Sometimes other people can read our souls when we can’t. Once you become aware of your passion, you can determine your mission and begin to feed it. This in turn will feed the drive that will make your dreams come true.

So find your passion and develop that passion to your advantage as a way to fulfill your dreams in life.

Source: Robert Kiyosaki’s Coaching Program

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Manny Pacquiao Success Story

Tyrone — Sat, 07 Nov 2009 08:09:12 +0000

I’m sure all Filipinos around the world know the name Manny “Pacman” Pacquiao. He is currently the undisputed pound per pound champion of the world and tagged as “The Destroyer!”

He has risen from extreme poverty to being the wealthiest boxer in the world today. What’s amazing from him though is that he does not brag about his wealth and his achievements. Despite his status right now, he remains to be very humble, God-fearing and respectful to his opponents and fans. Let’s look another rags to riches story as we take a peek on Manny’s success story.

Emmanuel “Manny” Dapidran Pacquiao was born on December 17, 1978 in Kibawe, Bukidnon in MIndanao here in the Philippines. Born of a typical poverty-stricken Filipino family, Manny Pacquiao left his elementary school when his father left his mom to go with another woman. As an out of school boy, he helped his mom by selling breads and home made doughnuts peddling the streets of General Santos City.

As a young boy, Manny had his interests in boxing already. When not wandering the streets to sell his merchandise, he would be seen visiting other nearby villages and towns to compete for boxing matches most especially during town fiestas for a reward of just P150 (~US$3) for winners and P100 (~US$2) for the loser. The money that he gets would be a great help for his mom to support their living expenses.

Pacquiao started his professional boxing career at the age of 16 at 106 lbs. With his agility and power in boxing, he won a lot of boxing fights. One day, he got invited by one of the boxing personalities to go to Manila to hone his skills in boxing. He did not hesitate and asked the perimission of his Mother Dionisia who later on refused to give him her consent telling Manny that boxing is a brutal sport that can pose a lot of danger to his life. With his eagerness in boxing, Manny still went on and sailed to Manila to continue his training.

In Manila, Manny trained himself with dedication. In his early boxing fights, he kept on winning but unfortunately, just like what other unknown boxers at that time, he earns a little money from his wins which was not enough for him to send money to his mom. To increase his income, he later on employed himself in the gym where he trained as a employee doing gardening and cleaning and occasionally doing construction works while pursuing his career in boxing.

Manny had such an amazing dedication in his boxing training that he trained like there was no tomorrow. Each day he would wake up the earliest and leave when all others left already. With his commitment, he raked eleven straight wins before he had his first professional loss to Rustico Torrecampo on February 9, 1996. Torrecampo was the only Filipino so far who had defeated Manny.

Manny continued with his fights knocking out opponents in Japan, Thailand and South Korea. It did not take long before he got his World Champion title on December 24, 1998 at a very early age of 19 when he defeated Chatchai Sasakul, the reigning World Boxing Council (WBC) World Flyweight Champion at that time.

Pacquiao went on with his fights training harder and increasing his weight to join heavier boxing division. He had his first boxing fight held at the MGM Grand Arena in Las Vegas Nevada during his fight with the then International Boxing Federation (IBF) Super Bantamweight Champion Lehlohonolo Ledwaba in June 2001. Apparently, he just receive a small money on his prize but he already made a noise in his American fans.

Manny went on to defend his new title then with the trainig of his coach Freddie Roach at the Wild Card Gym improving his hand speed and mental preparation. He was then recognized as a World Champion when he defeated Marco Antonio Barrera with a TKO in the 11th Round. Since then, his fights would empty the streets of Manila and all other cities sending people over to their homes to watch his fights making a zero criminal-related incidence in the country during the duration of his fight.

Only six months after he had his fight with Barrera, on May 8, 2004, he challenged another boxing fighter Juan Miguel Marquez who at that time held the titles of both World Boxing Association (WBA) and International Boxing Federation (IBF) Featherweight Champion. The fight ended up with a draw that left fans of both sides feeling bitter. However, Manny managed to collect his first million dollar in this fight.

Pacquiao once again moved up in a higher division and pursued a fight with another Mexican fighter by the name of Eric Morales on March 19, 2005 who handed him his first defeat in the boxing world stage - Las Vegas Nevada. However, Manny retaliated by knocking out Morales in their second fight on January 21, 2006.

On July 2006, Manny had a fight with Oscar Larios, the two time Super Bantamweight Champion held here at Philippines in Araneta Coliseum. The fight ended up with a TKO by Manny knocking down Larios on the 12th round. A series of fight by Manny went after Larios that includes Jorge Solis, a second fight with Barrera, a rematch with Marquez, a fight with Golden Boy Oscar De La Hoya, and last with Ricky Hatton which Pacquiao managed to win them all making him super famous in the boxing world and raking millions of dollars.

Ranking in one of the top richest Filipinos, Manny Pacquiao remains humble. Aside from being a great boxer considered by Time Magazine as one of the greatest athletes in 2009 making him as one of the most influential people for this year 2009, he was also included by Forbes Magazine in its annual Celebrity 100 list for this year 2009. Forbes listed Manny as the 6th highest paid athlete wtih a total of $40 million from second half of 2008 to first half of 2009. He was also the first Filipino athlete to have been honored to appear on a postage stamp.

When asked with his formula for success, Manny often says dedication, perseverance, courage, extreme self-discipline and prayer are his secrets. He once claimed:

”Anyone will succeed in whatever field of endeavor in life by acquiring the same virtues and character that boxing world champions do.”

Truly, Manny Pacquiao is one of the best athlete in the world not only in his profession but also to his friends as well. He never flashed his money, never wore gold and diamonds to brag to his friends, nor he treated people like they are inferior to him. He kept his same old friends and welcomed them to his mansion and always gives credits to the people who are the dearest to him.

Manny is a pioneer for young individuals who seeks success in life, respect for others, and a symbol of modesty and professionalism! Let’s all support him as one nation in his fight against the Puerto Rican boxer Miguel Cotto this coming November 14. I am very sure that once again, he will bring home the bacon!

Long live Manny and thanks for making all the Filipinos proud all over the world!

Source: Socyberty and Wikipedia

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How to Overcome Laziness

Tyrone — Fri, 06 Nov 2009 17:16:20 +0000

In one of my previous posts, I tackled about overcoming fear. Today, it’s time to tackle on how to overcome laziness.

Busy people are often the laziest. Busyness is a form of avoidance. If you stay busy you can avoid some of the things you don’t want to face—like exercising, or taking care of your wealth.

What’s the cure for laziness?

Kiyosaki says a little greed. Isn’t greed bad? Too much of it, yes. An excess of anything is bad. The fact is, however, that all of us secretly harbor a desire to have new or exciting things. We’ve been told by our parents and others to suppress that desire. We’ve been made to feel guilty about it. How many children have asked a parent for something and gotten the response, “Do you think I’m made of money?” In truth, guilt is worse than greed. Guilt stifles dreams.

When we stop saying “Life is too hectic to change it” and say, instead, “It’s time to exit this rat race and find new ways to earn wealth,” we begin to cure ourselves of our busy laziness.

The Rich Dad of Kiyosaki used to say, “The phrase ‘I don’t want’ holds the key to your success.” Kiyosaki saw what he meant when he got into real estate and quickly learned that he didn’t want to fix toilets. By finding a property manager who could fix toilets, he was freed up to buy a lot more real estate. And as a result, his cash flow increased.

Go ahead, be greedy, if that’s what your heart is telling you to do. But don’t overdo it to the point that you are doing illegal things. Persevere and work hard. Make a list of what you really want, and don’t limit it according to someone else’s idea of what you shouldn’t have—be truthful with yourself.

When your list is complete, step back and appraise it. Don’t ask yourself whether you can afford the things on your list, but rather how you can afford them. This fresh appraisal will create a stronger mind and a more dynamic spirit, helping you to shed your lazy ways. I suggest that everytime you feel lazy, take a look on your list and think of ways on how can you afford it. Most of all, TAKE ACTION and don’t be a couch potato!

As and end, I would like to leave another Rich Dad Tip:

“The words ‘I can’t afford it’ close your mind, while the words, ‘How can I afford it?’ open your mind. The human spirit is powerful—it knows it can do anything.”

Source: Robert Kiyosaki’s Coaching Program

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How to Fight Inflation

Tyrone — Fri, 06 Nov 2009 00:29:24 +0000

Inflation is one of the reasons why do you need to invest your money. In economics, we have known inflation as the general increase in prices of commodities. The higher the inflation, the lesser the value of our money. Inflation degrades the value of our money. Your money last year cannot buy the same amount of goods now.

WHAT CAUSES INFLATION TO INCREASE?

Increase in oil prices. Oil is a very important commodity in the world because it is one of the raw materials of every company used to run their machineries and equipments in production. When oil prices shoots up, their costs would shoot up too. Definitely, the only way for them to profit is if they sell their products higher than their costs. This causes the increase in prices of their finished products.

Too much money supply. By Law of Supply and Demand, a high demand with low supply would push the prices up while a low demand with high supply would push the prices down. The same thing goes to inflation.

During my high school years, I used to ask that since Central Bank prints our money, why can’t they just print more and more money and give it to all poor people to alleviate poverty? The answer is it would be dangerous to the economy of that country as it would cause a very high inflation rate or what we call hyperinflation. This was the case why the Zimbabwe currency fell too deep that it has almost no value at all.

Scarcities. Again by law of supply and demand, scarcities in supply of a particular commodity raises its price. When a country experience calamities like typhoons or drought that destroys various farm crops, then the tendency is that the prices of these crops would shoot up too.

HOW TO COMBAT INFLATION?

Add additional income. Take a second job or a part-time job to increase your income. If you can manage a small business while you are employed, then do it. Do something that you enjoy like freelance writing or tutoring academic subjects you’re good at.

Control spending. Learn to control your spending by cutting on unneccessary expenses prioritizing more on the needs and less on the wants. Try the idea of “downsizing“. Instead of buying a high end mobile phone or a laptop which you can’t really maximize its features and you just buy it just to be “in” trend, buy a low end which you can maximize its features.

Invest in high-yield types of investments. When you have already saved for your emergency fund, try investing the rest of your money into high-yield types of investments. Choose the type of investment which has higher interest rate than the inflation rate. For example, if the inflation rate is 5%, choose a type of investment that has a yield of more than 5%. In that way, your money’s purchasing power won’t be devalued.

Inflation is really a threat to financial freedom as it eats the value of our money. Learn how to fight inflation and increase the value of your money.

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Overcome Fear in Investing

Tyrone — Thu, 05 Nov 2009 02:40:46 +0000

Without doubt, each of us don’t want to invest because we are afraid of losing our hard earned money. The fear of losing money is the main reason a huge percentage of the public struggles financially. But fear isn’t the real problem. It’s how people handle fear that matters. Kiyosaki tells people that the primary difference between rich people and poor people is how they handle the fear of losing money. Some people, when hit with a financial loss, give up. Others transform the loss into a win. As John D. Rockefeller said, “I always tried to turn every disaster into an opportunity.” Losers are defeated by failure. Winners are inspired by it.

Kiyosaki often commented that the real reason for lack of financial success was that people played it too safe. “People are so afraid of losing money that they do lose it,” he would say. If they have some cash, they buy big houses and big cars rather than big investments. Or they invest all of their money in balanced portfolios—in CDs and low-yield bonds and mutual funds and a few individual stocks. These are people, driven by fear, playing not to lose.

Rich Dad Tip:

“The primary difference between rich people and poor people is how they handle fear.”

Of course, a balanced portfolio is a lot better than no portfolio at all. It seeks safety through diversity. Having a financial plan for security and comfort first are important. But if you have any desire to become rich, you must focus, not diversify. You must put a lot of eggs in a few baskets rather than putting a few eggs in many.

FEAR: I’ll lose all my money if I invest in anything riskier than CDs, bonds, and mutual funds.

FACT: If you lose some money, you can learn from the failure. Once you become an educated investor you’ll be positioned to reap potentially huge rewards.

FREEDOM: Financial failure can be transformed into financial gain.

If the prospect of failure frightens you, then play it safe. Keep your daytime job until you have enough cash to buy bonds and mutual funds and consult with a financial planner. But if the prospect of failure inspires you to fight and win, maybe you should challenge yourself to change your financial habits. Educate yourself and take some financial risks. The more education you have, the less risk there will be.

In investing, the higher the risk, the higher the reward. You won’t become successful if you didn’t take risks and part of that risk is the fear of losing money. Personally, when I increased my financial education, my risk appetite also increased. I started investing in mutual funds and unit investment trust funds and then went to a riskier type of investment - the stock market. As I increased my business acumen, sooner or later, I will begin engaging myself into business. The more financially educated I am, the less the fear that I am feeling about.

Source: Robert Kiyosaki’s Coaching Program

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Good Debt vs. Bad Debt

Tyrone — Wed, 04 Nov 2009 01:45:22 +0000

Debt has always been considered as a liability. Yes, in most cases, debt is a liability because it is money owed to someone else. One classic example of a liability is a credit card debt. When you use a credit card, you’re taking a loan from the bank or company that issued the card.

With that loan come interest payments. You generally do not pay interest for the first credit card cycle (usually a month), but any amount not completely paid off after that first cycle is subject to interest. If you carry a balance on your credit card, then all future charges are also subject to interest; there is no more first-cycle grace period.

Furthermore, many credit card companies charge an annual fee for use of the card. Credit cards easily seduce the unwary into debt. Because no money exchanges hands, it may seem as if something is being purchased for nothing.

HOWEVER, debt isn’t always a negative thing. It is not always a liability as we are accustomed to. There is bad debt and there is good debt.

Bad debt is money borrowed to purchase doodads such as clothes, cars, or electronic equipment. You cannot expect to get a financial return from something purchased with bad debt.

Good debt is debt that allows you to purchase assets. An example is money borrowed to purchase rental real estate. The tenant’s payments are used to pay off the loan and generate cash flow.

It can be financially smart to carry good debt; it is never financially smart to carry bad debt.

Rich Dad Tip:

“Every time you owe someone a bad debt, you become an employee of their money. If you take out a thirty-year loan, you’ve become a thirty-year employee.”

In finance, there is what we call as “debt leveraging” where you leverage debt to your advantage to convert a bad debt into a good debt. One example of this is your credit card. Instead of using cash, you use your credit card to purchase stuffs. You use it for its convenience and for security purposes. However, you must PAY IT ON TIME to avoid interest and late payment charges.

Credit card companies have reward points. So by using your credit card, you can accumulate reward points and exchange those points into freebies. Then sell that freebie item. The result - cash! Or you can also accumulate points in exchange of reward points for a free vacation. Instead of using cash to purchase things that you need, you take advantage of your credit card to convert it from a liability into an asset.

Another example of debt leveraging is by using other people’s money. If you have an excellent business idea and you see to it to be profitable, then you should not use your own money to establish that business. Get a loan from the bank or borrow money from your friends and relatives and use it to fund your business while you invest a huge portion of your own money into other investments. When your business succeeds, you pay off your loan and you get the interest income from your own money plus you get the cashflow from your business. You can use the interest income of your own money to pay-off the interest of the loan you have. Isn’t it good to use other people’s money?

Last example is the self-liquidating real estate. You take out a bank loan to purchase a good location real estate. Make it as your investment and rent it out to tenants. You just pay for the downpayment to the bank and the rental income from the tenants would pay off your monthly mortgage to the bank. So you just paid the downpayment and once you fully paid your mortgage to the bank, then the rental property would be yours and it would start generating positive cashflow for you.

So everytime you will have a debt, try your best to make it from bad debt into a good debt.

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6 tips for choosing a contractor

Tyrone — Tue, 03 Nov 2009 16:14:25 +0000

There comes a lot of times in life that you need a contractor. When you need house repair, you need a caprenter contractor. When your bowl was clogged, you need a plumber contractor. When you need a repair on your computer, you need a computer technician which is also a contractor.

The most important step in any renovation or repair is finding the right contractor. Choosing the contractor is key to the success of the project, no matter what the project is.

Getting someone who is reliable, honest, and skilled can spare you from remodeling nightmares. Here’s how you can choose the best contractor for your job.

Get references. Ask for a list of recent customers from your prospect contractors, then call them and find out if they were satisfied with the work done to them.

Get second opinions. Ask your friends and relatives if they can refer you to a reliable contractor. You can also ask the people in your organization or community for some recommendations. You can also search for the internet for some reviews done by people who had experience of their work.

Don’t go by price alone. One of the big mistakes people make in choosing their contractor is simply by price. The cheaper the price, the more it appeals to them. Get at least three estimates or quotes in writing for comparison. These should include all the materials, labor, and verbal promises people made. Be suspicious if someone offers to do the job for much less than the other estimates.

Learn the signs of fraud: Beware of contractors who:

Go door-to-door looking for customers or drive an unmarked van in your place
Ask you to pay the entire cost of a job upfront
Encourage you to spend a lot of money on temporary repairs
You can only reach through a limited number of options like answering machine
Quote you a price that’s vastly different from other contractor’s estimates
Make outrageous promises and pressure you for a quick decision

When you are ready to sign for a contract, make sure it includes all work details, warranties, time schedule, the quality of building or repair materials, and costs. Fill in all the blanks in the contract. Never leave empty spaces.

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How To Save Money on Christmas Gifts

Tyrone — Sun, 01 Nov 2009 15:22:16 +0000

One month more and it’s Christmas again! Time flies very fast! Santa Claus will again come to town and will visit each one of us to give some Christmas gifts! Are you excited? As a Santa Claus to your friends and relatives, are you thinking of what gifts to give to them this coming Christmas?

We all love Christmas. It’s the season of gift giving among our friends and relatives. However, it’s also the season of spending. You love Christmas but probably hate what it does to your budget. So how can you save yet enjoy the practice of gift giving during Christmas season?

Here are some tips on how to save money on your Christmas gifts:

Get creative on your Christmas cards. Christmas cards are all over during Christmas season. With everyone having a computer these days, it’s very simple to make your own Christmas cards. You can make one and color them for some creativity and personal touch. Customized and personalized christmas cards are appealing to the recipient because of the effort you’ve poured into it.

For the last minute Christmas card sending, you can find a lot of websites in the internet that offers free e-card (electronic cards). If you sent a free e-card to your aunt, for example, she’ll get an email that tells her you’ve sent a card. When she clicks the link in the email, she’ll be able to view and print the lovely card you sent.

Exchange gifts wisely. I find this a lot more common to us Filipinos. Often times, if we received a gift from friends, we may opt to “recycle” it and then give it as a gift to others too just changing the gift wrap. You just need to assure that the one who gave it to you won’t bother to ask you where’s the gift he just gave.

Stretch your Christmas budget. Start your next year’s Christmas shopping early on December 26. At after-Christmas sales, buy next year’s gift wrap paper and Christmas cards at 50 to 70 percent discount. Also, you might want to buy other Christmas presents such as Christmas ornaments, scented candles, gift sets, and other items. List down who each gift is for and store them to your Christmas closet. As you shop during the whole year, add items to your Christmas closet when you find good bargains. By December, you just need to buy few items and can enjoy the holidays!

Go for personalized Christmas gifts. Customized and personalized christmas gifts appeal a lot more because of the efforts you’ve exerted. Aside from personalized christmas cards, you can give personalized gift items such as customized alarm clocks, electronic photo albums, or even personalized pillows. For children, you can give personalized jigsaw puzzles with a design related to something they will really enjoy.

How about you? What are the ways you do to cut on expenses and spend less during Christmas? Christmas is the season fo gift giving but you don’t need to spend that much and hurt your budget.

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Be the Change! Participate in Youth Engagement Summit 2009!

Tyrone — Sun, 01 Nov 2009 03:25:44 +0000

Each one of us is capable to make a change in our country and in this world. SEAChange, South East Asia’s largest youth movement for personal change wants you to voice out your opinion on how can you make a change and do some difference in this world.

SEACHANGE is an ongoing movement connecting Southeast Asian Youths to projects, organizations, businesses, and leaders who can help them with the change they want to see!

In line with this, there will be a Youth Engagement Summit 2009 to be held at Kuala Lumpur Malaysia this coming November 16 to 17. 500 participants from all over South East Asia will be given a chance to win a free trip with hotel accommodation to participate in this summit.

Aside from meeting different youths all over South East Asia who share your goals, participants will be given the chance to ask leaders any question they have in mind with regards to making a difference.

Some of these business leaders include:

Biz Stone - Co-founder of Twitter
Randi Zuckerberg - Director of Market Development at Facebook
Garry Kasparov - Russian Living Legend of Chess
Dr. Mamphela Ramphele- Former Managing Director of World Bank
Nando Parrado - The Ultimate Survivor and Inspirational Speaker
and many more…

How To Join?

Simply answer the survey they have on what are the things you need for a personal change in your life and how can you contribute as a citizen to make a change in this world.

Get support from leaders and organizations

They have partner organizations ready to develop programs to help you with your personal change needs. The more youths voice out on what they need, the more programs, opportunities, and activities they can bring in!

How can I make a change?

As a participant, one of the things that I pledge to make a change in this world is to lessen poverty. Poverty, especially in Third World countries like here in the Philippines, is very rampant. One of the things that I pledge to do in order to fight poverty is through education - financial literacy - which is the main topic of this blog.

I believe that proper education, mindset and discipline is the key to lessen poverty. We must develop a lot of entrepreneurs to provide job opportunities for our people. This, in effect, will lessen the crime rate in our country. By giving them financial education on how to save money, grow their money through investments, and motivate them to achieve their goals, I pledge to make a difference in this country.

JOIN NOW and make a difference! Here’s how to join.

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Lessons from Slumdog Millionaire

Tyrone — Sat, 31 Oct 2009 13:02:54 +0000

I’m sure you are now all familiar with the movie “Slumdog Millionaire” by Danny Boyle. It gathered the most number of awards from the recent Oscars Awards. It’s all about the story of Jamal Malik, an 18-year old orphan from slums on Mumbai in India. He joined the Hindi version of “Who Wants To Be a Millionaire?” game show and won.

With the whole country watching the show, he is just one question away from winning the grand prize of 20 million rupees. Unfortunately, just before he answer the last question, police arrested him on suspicion of cheating - how could a ”slumdog” like him know so much where in fact he has a low education? How come that he can be doing so well on the game show when others who are brigther, more educated and wealthier than him have failed?

Jamal answers these questions by telling his life story in the slums of Mumbai from his childhood with his brother Salim, his crush for Latika and their fight to survive on the streets to justify each correct answer that he has.

What are the lessons that we can learn from Slumdog Millionaire?

Experience is the best teacher. Jamal had experienced a lot of challenges living in the slums of Mumbai. The fight for survival taught him a lot of lessons in life. Some of these lessons cannot be learned through our traditional schools but through our experiences in real life.

Life is a learning experience. We need to fail first in order to succeed. During these different trials and challenges in our life, we become strong - we become street smart. Every experience that we had contributes on who we are right now.

Will power. There’s a saying that if there’s a will, there’s a way. One of his dream is to find his true love Latika. His will power and his eagerness to find Latika guided him to review his past experiences that ultimately led him into the right answers to the questions.

Be thankful for your blessings. As you can see in the film, there is a clear picture of poverty in the slums area. Millions of people in this world were given almost nothing. Comparing your situation to them, consider yourself as lucky and thank God for all the blessings that you’ve been receiving.

Honesty is the best policy. There’s this famous saying that “the truth shall set you free”. In this movie, Jamal is being accused of fraud and cheating as he knows every answer to the question. A lot of contestants who are more educated than him participated in the contest but they did not win. How can he won the game where in fact he’s not that educated? Each question was related to his life and with common sense, he got the right answers!

There is always hope. There is one scene in the movie where the entire city stops to see if Jamal can answer the final question. Mumbai turns into one parking lot, with its citizens, mostly the poor, tuning in and supporting their hero. During that sequence, Boyle enlarges the situation, from being a mere personal quest for Jamal to find Latika (and vice versa) into a national quest to prove that there is something more to life than poverty and suffering.

Even if you are in that hard situation right now, don’t lose hope. As long as you are alive, always expect the best to happen. Be optimistic and take the necessary actions.

How about you? What are the lessons that you’ve learned from this inspiring movie? Truly, Slumdog Millionaire deserved to have won the various awards from Oscars.

P.S. Here is the trailer of the movie if you haven’t watched it.

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Are you deep in debt? Take the debt quiz!

Tyrone — Sat, 31 Oct 2009 06:18:54 +0000

The primary reason most people have money problems is that in school they were never taught cash flow management. Without this training, they wind up working harder and harder in the belief that making more money will solve their problems. Unfortunately, more money often just sends people deeper into debt. More money won’t solve problems if cash flow management is the problem.

As CEO of the business of your life, you’ve created a personal financial statement and analyzed it. The next step is to take control of your cash flow.

DEBT QUIZ: ARE YOU DEEP IN DEBT?

The cash flow management plan you develop depends on your level of personal debt. To get a sense of how deeply you are in debt, look at the list below devised by Kiyosaki. If you can answer yes to any of the questions, put a “1”.

Do you pay your bills late?
Have you hidden a bill from your spouse?
Have you neglected repairing the car because of insufficient funds?
Is there family tension because of overspending?
Have you bought something recently that you didn’t need and couldn’t afford?
Do you regularly spend more than your paycheck?
Have you been turned down for credit?
Do you buy lottery tickets in the hopes of getting out from under?
Have you put off saving money for a rainy day?
Does your total debt (mortgage excluded) exceed your rainy-day reserve?

Add up the numbers. Is your score 0? Good for you! You’re in control of your cash flow. If you score in the 1 to 5 range, however, you may need to reduce your debt. If you score in the 6 to 10 range, watch out—you may be headed towards financial disaster. The higher the score, the more urgent it is that you increase your financial literacy.

As for me, personally, I scored zero at this point of time because I know how to manage my cashflow and partially because I’m still single. However, I believe that as soon as my time comes to have my own family and dependents, I would need to retake this debt quiz and assess myself again. I just hope that with the preparations that I’m doing right now that I’m still young, I would still get good results when the time comes for me to take this debt quiz again.

How about you? What’s your score? Are you deep in debt? If you are, then you should act now before it’s too late.

Source: Robert Kiyosaki’s Coaching Program

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The Right Path To Financial Freedom

Tyrone — Fri, 30 Oct 2009 01:06:59 +0000

In one of my old posts, I gave some steps that you should take in your journey to financial freedom. Having financial freedom gives us the liberty of doing the the things that we enjoy without having to think too much on where to get the next meal that we would feed to our families.

You may be familiar with Kiyosaki’s Cash Flow Quadrant where he divided people depending on where their income flows. It is the famous ESBI which stands for E-Employee, S-Self Employed, B-Big Business Owner, and I-Investor.

The path that Kiyosaki recommended is through the B and I quadrants. Why? Because in the B quadrant, people would be working for you, and in the I quadrant, your money would be working for you. The person who has knowledge in these two quadrants achieves what most people throughout history have yearned for: freedom from work.

Here’s what the path looks like:

According to Kiyosaki, many of the super rich follow this path—people of legendary status such as Bill Gates, Warren Buffett, and Ross Perot. Can you? Yes, if you’re sufficiently equipped with knowledge, experience, and determination.

A word of caution, however: The B quadrant is very different from the I quadrant.

Many successful Bs sell their businesses for millions and then let their newfound wealth go to their heads. Convinced that their dollars are a measure of their financial IQs, they go swaggering into the I quadrant and then lose everything. Kiyosaki said that anyone can go bankrupt in the I quadrant just as easily as in the E, the S, or the B—and more quickly.

Which quadrant should you go first: Is it the B or the I quadrant?

Kiyosaki recommends to go first into the B quadrant before going to the I quadrant. However, he further added that if you have plenty of money, financial intelligence, and free time, then by all means go straight to the I quadrant. But if you don’t, the path Kiyosaki recommended is safer.

There are two good reasons to enter the B quadrant first:

Succeed as a B and you have a greater chance of developing into a powerful I. After all, investors invest in businesses. Once you gain experience in the B quadrant, you’re better positioned in the I quadrant to identify businesses that would make good investment opportunities.

If you have a business that’s up and running on its own—that doesn’t require your babysitting—then you’ll enter the I quadrant with two prerequisites: the free time to hunt for good opportunities, and the cash flow to support the ups and downs of investing.

Rich Dad Tip:

“On the right side of the quadrant, you gain time and therefore freedom—to make money, to give it away, and to be with your loved ones.”

Most of us are working on the left side of the CASHFLOW Quadrant. By working hard we get promoted and gained more responsibility, but as we climbed the ladder we had less and less time to spend with our family and loved ones. On the left side of the quadrant, increasing success brings you less and less time.

The right path to financial freedom is by working hard on the right side of the CASHFLOW Quadrant. We should climb our own ladder, and the higher we climbed, the more time we had for our family and loved ones.

Kiyosaki relates that when his Rich Dad’s business reaped profits, he expanded the business and simply hired more people to do the work. If his investments did well, he reinvested the money and made more money. He then have a lot of time to spend with his son and with Robert.

This is a major difference between the left side and the right side of the CASHFLOW Quadrant: The right side gives you time. And time is freedom—freedom to make more money, to give it away, and to be with your loved ones.

The path to freedom is open to you. You can be a worker bee, buzzing around till the end of your days, barely noticing those around you, or you can be a free spirit, with plenty of time to seize the day and tend to your family. Freedom is yours for the taking.

Let’s all achieve financial freedom! I am happy that this blog has helped a lot of people as they track steps in their journey towards financial freedom.

Source: Robert Kiyosaki’s Coaching Program

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Why do you need an Emergency Fund?

Tyrone — Thu, 29 Oct 2009 00:06:54 +0000

WHAT IS AN EMERGENCY FUND?

Life has a lot of uncertainties. You may not know that one day you’ve been hit by a calamity, you had an accident, you suddenly became ill, or your house got burned.

In these circumstances, you need to be prepared. In personal finance, it is often called “saving for the rainy days”. These savings is often called emergency fund that is often used when we encounter emergency situations.

WHERE SHOULD YOU PUT YOUR EMERGENCY FUND?

Since emergency funds are savings that should be used anytime you encounter an emergency situation, you should put it in a type of investment that is liquid, safe, and don’t have long holding period. We say that an investment is “more liquid” if it’s easily converted into cash. What are these types of investments?

ATM Savings Account - You can put your emergency fund by opening a regular savings account in a bank that is accessible through ATM. Choose the bank with the most number of branches so that you can almost anytime access your emergency fund when the need arises.

Passbook Savings Account - Alternatively, you can also use a passbook savings account to lessen the temptation to withdraw your funds just anytime you want since withdrawing from a passbook account is not as convenient as compared to an ATM account. You might want to open a passbook account with a bank that is nearer to your place and provides the highest interest.

Time deposits - If you are looking for a type of investment that can provide higher interests for your emergency fund, then you might as well consider time deposits. Just remember the holding period. You should consider the time deposit with the least holding period.

HOW DO YOU BUILD AN EMERGENCY FUND?

Pay yourself first: The easiest way to build an emergency fund is to pay yourself first. If you are employed, which I believe most of us are, set aside a portion of your salary every time you receive it. Depending on your expenses, the least amount advisable is 20% but of course, the higher the better.

One of the most useful personal finance equation is: INCOME - SAVINGS = EXPENSES. That is, set aside a portion of your salary as savings before you can spend the rest. Why? It is because savings is the most important expense as it buys your own future.

Budget. Learn to budget your money. Prioritize your expenses more on the needs and not on the wants. There are a lot of ways on how to squeeze your money into savings to build up your emergency fund.

HOW MUCH SHOULD YOU SAVE FOR AN EMERGENCY FUND?

The amount you need to save for an emergency fund depends on your situation. If you are the sole breadwinner of your family, it is advisable that you need to save at least 6 months to 1 year worth of living expenses. Compute you average monthly living expenses and you need to save 6 months up to 1 year worth of that. This is also enough just in case you get laid off in your job.

However, if you don’t have a lot of dependents or if you have other sources of income to support you, you might want to consider up to 3 months worth of your monthly living expenses.

Just remember if you were able to save for your emergency fund already, invest your extra cash in other types of investments where it can provide more interests for your money. Here are some of the options on where to invest your extra cash.

P.S. I would like to invite you to join the Youth Summit South East Asia where you could possibly win free plane ticket and accomodation to Malaysia and meet leaders like co-founder of Twitter, Marketing Director of Facebook and much more.

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Business Entity: Corporations

Tyrone — Wed, 28 Oct 2009 00:45:28 +0000

Ok, we tackled about the first two business entities already: Sole Proprietorship and Partnership. Like most of all of you know, the third business entity is Corporation.

A third and very different choice of business form is the corporation. Unlike the sole proprietorship and the partnership, the corporation is an entity completely separate from you, the person incorporating it. Your company is now an “Inc,”, an Incorporated and with that designation comes some additional paperwork and compliance issues based on the laws of incorporation in which you choose to incorporate. However, the corporation provides a level of protection for you. Because it is a separate entity, it should provide protection for your personal assets from creditors of the corporation. Although you may want to do some of this legwork yourself, you should use a lawyer for much of it.

There are basic steps in creating a corporation. Here in the Philippines, you will file articles of incorporation and by-laws in Securities and Exchange Commission (SEC). The document should contain the shareholders of the company, their addresses, how many shares they hold, and other details. Here is a sample articles of incorporation form from SEC.

Once you incorporate, there are certain rules and formalities that must be observed. For instance, for publicly listed companies, they are required to hold shareholders’ meetings and keep updated business records such as financial statements. If not, your corporation could be dissolved and you might end up paying a fine. There are consultants who specialize in assisting companies with compliance requirements. A consultant will make sure all necessary meetings are held and documented, and that all incorporation paperwork is filed. Check with your legal counsel, who may provide this service or direct you to a consultant in your area.

On the bright side, remember that the corporation owns its own assets and pays its own debts. This is the secret of the rich. If, on paper at least, you don’t own anything, then you can’t lose it. If a party claims injury from your business and sues, your personal assets should be protected.

Is Corporation for you?

Here are a few questions to ask before you decide to form a corporation. The more yes answers you come up with, the more applicable a corporation is to your business.

Is your business growing so rapidly that you can no longer handle it alone?
Do you need to raise more capital?
Do you want less risk personally?
Can you visualize sharing control of your business with another?
Has your business outgrown your goals?
Would the business benefit from managerial and creative skills that you lack?
Do you want to offer fringe benefits that are only available through a corporation?

As an end, I would like to leave another Rich Dad Tip:

“This is a secret of the rich: The corporation owns its own assets and pays its own debts.”

Source: Robert Kiyosaki’s Coaching Program

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Business Entity: Partnerships

Tyrone — Tue, 27 Oct 2009 02:44:12 +0000

Yesterday, we tackled about sole proprietorship as one of the three main types of business entities. As Kiyosaki said, sole proprietorship is not the kind of business entity that he can recommend because as a business owner, you would be “solely” responsible and liable to your business and there’s a risk of putting your personal assets in danger if the business fails.

Today, we would tackle the next business entity and that is partnership. Like a sole proprietorship, a partnership requires no special paperwork. It is simple and relatively cheap to start. You and your partner(s) will probably want to operate under a business name, so be sure to register it with the appropriate government agency.

In addition, you should set up an agreement so that each partner’s rights and liability are clearly outlined. Kiyosaki said that in any partnership agreement it’s important to include the following:

Date of agreement
Names of partners
Type of business entity
Amount of investment from each partner
Location of business
Description of proposed accounting system
Employee management roles
Draws, salaries, or bonuses
Division of profit or loss
Restrictions on fiscal authority and expenditures
Duration of partnership
Plans for altering or dissolving the partnership
Distribution of assets upon dissolution of partnership
Provisions for settlement of disputes
Settlement in case of death or incapacitation

Is a partnership the right business entity for you?

Let’s say you don’t want to run the show by yourself. Perhaps you lack the experience to make a success of your business, or you simply prefer sharing responsibility with others. Then you may consider a partnership. It is often said two heads are better than one, and for some people the additional ideas and enthusiasm generated by a partnership can bring comfort to what would otherwise be a daunting task. Partnerships can also increase the amount of available capital, and new businesses need plenty of that.

On the down side, in a partnership you give up a certain measure of freedom and control. People being people, disputes are bound to occur, causing many sleepless nights. It is also important to remember that business decisions and actions taken by your partner are legally your business decisions and actions too, even if you do not know about them in advance.

You are obligated by your partnership to live up to all agreements entered into by the partnership. In a general partnership, as in a sole proprietorship, liability rests entirely on the shoulders of the owner(s). Not only are you fully liable for your decisions, you’re also fully liable for the decisions of your partner. Once again, your personal assets are completely at risk, but now they’re at risk for decisions your partner may make.

Two Types of Business Partnerships:

Kiyosaki said that there are two types of business partnership: general partnership and limited liability partnership.

In a general partnership, you risk your personal assets if the business fails not only for your decisions alone but also from the decisions of your partners.

In a limited liabiliy partnership, as the name implies “limited liability”, one business partner may not be responsible for the another’s misconduct or wrong decision.

Choosing the right business partner(s)

Just as important as the decision to form a partnership is your selection of partner(s). When considering a partner, Kiyosaki recommends to ask yourself the following questions:

Are you keeping emotions out of the selection process? Best friends don’t always make the best partners.
Have you taken a careful look at this person’s financial history? A poor credit rating could seriously hobble your business.
What professional talent does this person bring to the partnership?
Will this person’s personal life interfere with business?
Do you share the same values?

If you don’t feel comfortable with your answers, you might want to go hunting for new partners or consider a different entity for your business. On a more personal note, I chose the wrong business partner when I engaged myself into my first business venture when I was 22 years old. I almost lost all the capital that I invested except for the few inventories that I was able to sell. Remember to choose your business partners wisely.

Source: Robert Kiyosaki’s Coaching Program

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