Category Archives: Financial Advise

So How do I budget my Money?

This is a follow up on my post yesterday on how to budget money, as of now, I am currently paying off my loans. Currently, I am 65.89% on attaining my financial balance goal and 16.63% on my D-to-E ratio goal. My D-to-E ratio is currently pegged at 1.6848 but I think I could make this better by the end of summer. These numbers are currently changing due to my adjustment period when I move to Bataan. I’ll be updating this page as soon as I get adjusted and get more information.

2013 BalanceFortunately, I am 3.33% better (March balance) than my previous balance making it 7.77% better than my projection. This April, I am 9.55% below my last month’s balance but 5.54% better than my projection. I am nervous with this month’s balance that it might fall below my projection which will hurt my overall balance and projections for my upcoming months.

ComparisonComparing my projections from 2011 up to the present I think I’m doing better, I still have to do better! So far I won’t be reaching a plateau yet and I hope I won’t in the near future. The balance from May 2013 to December 2013 are still projections.

The pie chart above is my current budget profile but I have to adjust this as soon as I pay off my debts like below.

In a wishful thinking, I should be able to get the rest of my pay by the first or second week of May and this should include the following:

  • Pro-rated 13th month pay
  • Unpaid salary due to cut-off – most companies implement 10th and 25th cutoff time for payroll. Assuming you resigned on the 30th, that means your backpay includes 5 days of work.

(source: http://www.callcenterbeat.com/how-to-compute-back-pay-in-the-philippines/ April 3, 2013)

I just hope it covers what I have loaned for.

Starting to Budget

One of the many questions people ask me is how to budget properly. This sample computation shows how to budget a Php10700.00 salary after tax (Php12000.00 gross).

The graph above shows a sample computation when you are starting to build your emergency fund. An emergency fund is something you must first establish. Emergency funds are usually 3x or 6x that of your gross salary. Therefore you must save Php36000 to Php72000. This fund must only be accessed if you get laid off or resigned in a job and must be replenished as soon as possible. I’ll make another post on how to use time deposit products of banks to maximize potential earnings.

The graph above shows a sample computation of a budget after establishment of an emergency fund. As you would see, you could now use extra funds (“others”) to buy “wants” or you could put extra funds towards investing. For visualization, please click here…

If you have any questions place them in the comments or hit like :)

Write What Needs to be Controlled

 

I know that I am not the most disciplined person in the world so that I have to find ways to control myself from overspending to overeating! I learned to control my finances during grade school. My mother would give me my month’s stipend and I learned how to budget it. Over the years I developed strategies to control my overspending and this is through the use of computers. I monitored my expenses first using MS Excel then worked my way to more complicated programmes that also monitors my investments and until eventually I found iCash. iCash is a software intended to control your personal finances. It helps you keep track of your incomes, expenses, credits, debts and bank transactions. To know more about the iCash just click here.

I’ve also develop ways on minimizing on-the-spot overspending! People tend to overspend in groceries because they can’t monitor the price of what’s already in their cart not until they check-out. Some people opted to jot down and calculate using a pen, a paper and a simple calculator. I know it will be a little bit off if you would bring your notebook computers to the grocery store but I think this will help you a lot! This is a grocery tool that will automatically calculate the items in your cart if you input them in while you throw them in! All you need to do is go here and download it. I’ll try to make other financial tools for you guys…

Figure 1 Balance Projection

Figure 2 Expenses Projection and Comparison

*Blue lines are the projection, red lines are the actual

 

Figure 3 Three-month expenses chart

Figure 4 DNAVPU of BDOEquity

Average change in the daily net asset value per unit per day of BDOEQ is 0.1824

BDOEQ and other UITF graphs from 1-Mar up to present is available, just use the contact me page to request for details.

8 out of 10 Filipinos Don’t Have any Savings Account?

I’ve read a couple of days ago that 8 out of 10 Filipinos don’t have any savings or any bank account! I was not surprised by the fact that this is happening. I teach in a good school where my students could afford iPads and other techy gadgets but in a class of 40 students, only 5 have a bank account. I don’t know if people are just too afraid to save or just don’t have the knowledge and right tools to do so.

I base my advices to what I have experienced and experiencing. I know I’m broke but I’m working there! I believe that by the end of this year I know I would’ve cleaned my debts and would start a new goal.

The question is how to live a debt free life? Simple answer: Don’t over spend! As simple as it is to say but it’s hard to do. Here are the steps I’m following and I’ll follow.

Step 1: Start paying off debts!

I’ve set up a clear goal that I should follow. I would pay my debts as soon as I can, starting from the largest every month.

Step 2: Enrol in a time deposit every month to establish my emergency fund which is good for 6 months. Then afterwards

Step 3: Enrol in CitisecOnline to diversify my investment portfolio. Not just the standard BDO Equity Fund which I’m currently investing and planning to increase my contribution.

There is no formula to success. Everyone is entitle to their own way of living J

Investing

 

I’m hoping for better days this coming season. I’ll be spending a little less than usual just to maintain my balance until the 28th. I’ve been up to debts again but nothing I could not handle. Read a few articles about investing again, I’m planning to change my tactics and try a different approach. At the end of my goal I should be able to invest in a diversified portfolio of stocks and mutual funds at the same time I’ll be gunning to start on my emergency fund. I read that I’m supposed to have at least 6 months equivalent of my salary to have a stable emergency fund budget. I’ll be combining Bro. Bo Sanchez formula with that of what I’ve found in the internet and I’ll make constant adjustments to it.

A sample of what I’m planning to do is this:

Eventully, I’ll reduce putting something in my emergency fund as soon as I build it. I know it will take some time considering the current situation I’m in.

The above graphs are comparisons of expenses from February to April 18, 2012. My expenses decreased by 18.03% compared from last month.

The Daily Net Asset Value Per Unit (DNAVPU) of my investment in Banco de Oro is looking pretty good.

Average change in the daily net asset value per unit per day of BDOEQ is 0.3843

BDOEQ and other UITF graphs from 20-Mar up to present is available, just use the contact me page to request for details.