The Serious NUTS

Out of retirement

2009-01-26T15:14:00.000-08:00

I know there is a global recession but I am not talking of retirees going back to work. I am talking of about reusing some of old equipment that otherwise only gathering dust.

Mine is an old laptop that I have from almost four years ago. It is hidden in my closet and had not been used for more than a year. The reason - I was told it was broken and two major PC shops told me that it can only be fixed by the manufacturer. I could not do it even if I wanted to because the manufacturer has already folded - an early casualty of the credit crunch.

It all happened by accident. I was surfing through the web and found out that this is a common issue with Averatec 3250 laptops. I even found photos from Flickr showing step by step dismantling of this particular model.

Since I have a desktop now, I thought there is no harm of trying to fix the laptop myself. After almost two hours and less than eight quid for the parts bought from ebay, I now have an extra computer for use. It is working for more than a month now with no problem.

My niece heard about me fixing my laptop so she asked me if I can fix hers. With my new found confidence, I took and worked on it for three days. I found out what was wrong and fixed it. Even I was surprised to be able to do this.

One added benefit - I got twenty-five quid for it. Not bad for a novice.

Now, some of my niece's friends are asking me to fix their computers. I maybe starting a business on the side without realising it.

If fixing computers is not your cup of tea, there are other skills that you learn to save and possibly money.

Learn car maintenance skills. This could be as simple as replacing busted headlights to small repaints - these little steps will go a long way when you intend to sell it (my wife make fun of me for having these skills although I don't drive). Oil change is also a regular maintenance skill you can learn - which can cost you around thirty-five quid here in Belfast.

Home repairs. Fixing a broken toilet flush. Building small storage boxes for toys. There are endless possibilities you can learn and do in this area. Just make sure that you don't sacrifice safety and quality just to save a few quid.

I always try to learn new skills whenever I can. This is something I learned from being an IT professional. I may not need them now but may be needing them in the future.

Just imagine how far I follow this principle. Give me a paper clip, a pair of pliers, a needle and thread and I can fix a broken umbrella. I had saved some money doing this several times when I was back in Manila.

Behind close doors

2008-12-11T09:47:00.000-08:00

Bumps and bruises are common for active children as their time is mostly spent on playing and getting dirty. Because of the rough and tumble nature of the games children play (especially the much younger ones), we tend not to make a big fuss for it is but normal.

Not this time.

A teacher noticed some bruises on one of her pupils. She did not think there was anything wrong at first until it become more frequent and severe. Hesitantly, she approached the child to ask what happened. As expected, she was told that it was from an accident - a nasty fall.

The teacher was still suspicious so she started monitoring the child more closely to see if there is cause for alarm. One morning, her instinct was proven right - that there was more to it than normal bumps and bruises.

The child came to class clearly enduring something on her right side. She was in excruciating pain as she would not budge an inch from her seat. On closer look, the teacher was shocked to see a swollen shoulder. Fearing the worst, she called the Social Services for help and brought the the child to the hospital for an x-ray.

The child had a fractured shoulder.

For the Social Services, this only pointed to one thing - a case of child abuse. Their interview with the child revealed that her father had been hurting her for some time. Worse, she was not the lone victim - a younger brother from another class is suffering the same fate.

This is real life, not a plot from your afternoon soaps. What is more disappointing is that it involved an OFW migrant family.

I could not imagine what will drive a father to hurt his own children. Maybe it was the frustration that after years of supporting his family, he ended up the one being supported - bound to the home and doing the traditional role of a wife.

Maybe it is his failure to connect with his children after being away for a long time being an OFW in a previous lifetime.

Maybe it was the depression of realising that the life you left may have been better than what you are facing now.

Whatever the reasons why it happened, the undeniable fact remains that it happened. Sadly, the impact of such act is indiscriminate, punishing even the helpless victims.

The parents suffers the break up of the family and humiliation of being deported. The children remain in the custody of the Social Services to protect them from further abuse, in the verge of being lost within the Irish foster care system.

This is one OFW's dream turning to a hellish nightmare with no chance of waking up.

Hidden cost of debt

2008-11-23T15:53:00.001-08:00

The topic of cost of debt, especially consumer debt, is a widely discussed one. From the horror stories of people drowning in ballooning debt to the specifics (like late payment penalty fees) on how credit companies tries to confuse, if not hide, these fee related information. There are also articles from the other side of the aisle that can help consumers identify and avoid these traps.

But there is another side of debt that is seldom discussed. Debt's impact beyond the quantifiable financial aspect is often ignored.

Debt woes will turn into despair. If you have missed a credit card payment before, you may have experienced receiving a nasty call from collection agents subcontracted by credit card companies to remind you about the payment. Although I know that most of what they say are just scare tactics, I still can't help but be swept by the anxiety from these calls. Imagine this fear and multiply its magnitude by the number of debtors you have to face.

Debt is a major contributor towards stress and depression. This current global recession has made this fact more obvious. In worse cases, there were people pushed to consider, if not actually, taking their own lives to escape their financial problems.

Debt pressures to family relationships. There are a many of us who chose to suffer in silence. In our desperate attempt to shield our family from the financial worries, we are unintentionally doing the opposite. Being preoccupied with debt and depression will result to us bringing the anxiety home to our family.

Debt will lead to broken relationships. When partners learn about the financial problems for the first time, there are many who will react by blaming each other especially if they have different spending habits or debt tolerance levels. Even children are not immune to this.

Debt can leave a lasting legacy. Being in debt keeps us parents from providing the best opportunities to our children. For instance, our dire financial situation can spill over to our ability to send our children to the best schools or to keep them in good health. Without these, we are practically impairing their chances to succeed in life.

Our attitudes greatly influence how our children behaves towards debt. Children learn by mimicking parents behaviour and that includes spending habits and attitude towards debt. If we are not careful, our children will be repeating the same mistakes we made over debt.

Debt, like wealth, can be inherited. If we are overburden with debt and can't afford to support ourselves, the children are expected to pick up the responsibility. How often do we hear children taking on debt for parents' medical expenses. How often do we hear Pinoys say "Pera lang yan, napapalitan. Ang buhay ng tao hindi".

Worse, the impact of debt can extend beyond our lifetime. If we are not properly prepared, there will be no one else who can provide us with a decent funeral but our children. Even the most basic funeral service can be expensive.

There are also instances when debts are taken on by children just to preserve the parents' memories. It is not unusual for children to take on unpaid debts from parents - especially those incurred on properties with sentimental value like family homes and heirlooms.

Personal debt affects society. The consequences of debt are never isolated. As hard as we try to isolate ourselves, the impact of debt can never be limited to the individual. Debt is even indiscriminate as it affected everyone, even those that not overburden with debt.

Taking on debt should never be taken lightly. It affects you and everyone around you. With the recent financial crisis, I just hope that people had learned their lessons to avoid repeating this in the future.

Preparing for the long deep recession

2008-11-18T10:15:00.000-08:00

The global economy is now in recession. All of the major economic areas had either declared that they are already in, if not heading to recession - Great Britain, the Eurozone, Japan and the US (not officially but they will do so eventually).

The world governments are throwing everything they got to ease the situation. Huge base rate reduction, stimulus packages for consumers, bank bailouts but nothing seems to be working. Forecasts even points that this will be a long and deep recession.

With this in mind, it is only sensible for an OFW like me to prepare for it. Here are some tips I am doing to do this.

Increasing my emergency fund. The normal financial advice is to keep at least six months worth of living expenses. This may be enough in normal times but not on this occasion. I have seven months worth in a high-interest account but I am targeting to have at least a year worth by early next 2009.

This is crucial for OFWs like me who do not have long term residency and requires work sponsorship. This will provide some buffer in the event that I get hit with redundancy .

Paying old and avoiding all new debts. Regardless what you might think, consumer debts (the kind that we usually have) is never good. This is quite evident now as excessive debt is the primary driver why are in this recession now. You are very thick not to believe this and continue piling new debts.

Bargain hunting. This is one of the few silver linings in this recession. Retailers are offering good discount deals to stimulate sales. Just make sure that what you are purchasing is a real need like clothing.

Lastly, stay employed. Just imagine these alarming statistics. The US already lost 750000 jobs to date (with one quarter left for the year) and here in the UK, forecasts shows that unemployment can reached upto 3 million next year. Citi recently announced that an unprecedented headcount reduction of 50000 employees.

If there is a time when possibility of losing your job is great, it is now. This is very important to realise as like most OFWs, my family is entirely dependent on my salary. With this, we should try to keep our only source of income at all cost.

To do this, try to make your role as important as possible. Aside from your regular tasks, offer something extra by taking on responsibilities from people you report to. Raise your company profile by working on projects important to management. Keep your skills relevant.

Just in case, always keep your resume current. Get into training for transferable skills related to people management. This can give you the edge in looking for a new job.

Times are tough but it may still get tougher in the next few years. There is nothing you can do about this except try to prepare. If for some twist of fate you see yourself in the bottom, it will be easier to pick yourself up if you are prepared for it.

5 tips to avoid overspending on Christmas gifts

2008-11-08T13:00:00.000-08:00

By this time, most of us may be feeling the pressure of finding the best Christmas gifts for our family and friends. And if we do find them, we ask ourselves if we can even afford these items. Even for good savers, the holiday season can still be a burden.

But there is something we can do to avoid this. For me and my family, this is what we have done.

Set a Christmas gift budget. Based on our spending from the previous years, we determine how much we want to spend for this year and not a penny more.
Start saving the needed amount early. We have a family budget for the year so this was as simple as setting aside the needed amount monthly. We reviewed our expenses to find out where we can cut spending and reallocate the amount to the Christmas budget.
Lists all recipients and the budgeted amount for the gift. For some, we set aside a budget for a gift to the family instead of individual gifts. When we actually shop for the gifts, we make sure that we don't exceed the allocated amount.
Window shop. This allows us to get ideas of potential gift items and show us the different options we have for each gift. This also allows us to compare prices and ensure that we get best one.
Shop early. By doing this, we not only avoid the Christmas rush but also allows us to take advantage of the Sale season (there are several scheduled each year).

Household Finance Workbook

2008-10-10T04:40:00.000-07:00

After a couple of weeks of Excel development, I finally have a usable workbook that we can use in managing our family's finances. It will continue to be a work in progress but it is in a state now that I can share this others.

First area that I addressed is the budget plan and expense tracking. I leveraged the initial envelope budget workbook I previously created. I extended from this is and included the tracking for the actual monthly expenses.

Next thing that I needed to track was our net worth. This section showed all of our assets and liabilities at any given time. There is an asset allocation table that shows the distribution of our assets and another table to show the key performance indicators that we track.

The most important feature that I added is the Household Finance Dashboard. In this tab, I can easily monitor what my current financial status. I used key personal finance ratios to determine our financial health. There are also sections to show how diversified my portfolio compared to recommended mix for my age and another section to track our expenses.

This dashboard is not yet complete. I am planning to add a section to track our short and long-term goals. I am still thinking how to effectively do this. If you have some suggestions, feel free to share them with me.

If you are interested with the workbook, here is the link.

Diversifying investments in a credit crunch

2008-10-01T15:02:00.000-07:00

I am currently in the process of completing a Consolidated Household Finance workbook (wait for its release on Wednesday this week). I created this tool to better manage my finances.

While creating this finance workbook, I realised that our investment seem to fit the path commonly taken by OFWs. Like most, the investments we made are in real estate. In fact, almost 70 percent of our assets are in this category.

Most OFWs get into real estate based on the assumption that real estate properties will always go up in value. We continuously hear this sales pitch from real estate agents and brokers who many of us are made to believe this would always hold true. With the events in the housing market in the US (and its eventual global impact), our blind confidence on this premise may not be totally wise.

I am not really worried about our real estate investments in the Philippines. First, none of these are in any mortgage. Second, the property market still seems to be stable that I feel that we can sell the properties if we needed the money (although we have setup an emergency fund that we can tap before even considering this).

Yet, I realise how vulnerable our family is. I could not imagine how devastating it would be for us if our real estate investment fails. The only way I could address this is by diversifying our investment.

Now, I am planning to increase our investments in equities and fixed income instruments. I feel that this is a good time to start investing in the stock market. It had been hammered for more than a year now so there is no other way to go but up.

I am not an expert in the equity and bond markets. The only exposure I had were investments on company stocks and mutual funds in the Philippines. Luckily, I am here in the UK which allows me access to other options not available in the Philippines.

My ticket to the stock and bond markets will be an ISA (Individual Savings Account). The ISA , launched by the UK government in 1999, is a tax-free investment subject to some limit amounts. For the tax year that started last April 2008, the limit is up to £7200.

To invest in the stock and bond markets, I plan to open a Stocks and Shares ISAs called Self-Select Funds ISA with my current provider ISA Halifax. For this type of account, I have access to different investment funds - from money market funds, index trackers to actively manage funds. Best of all, I also have access to different funds investing in the global markets.

It may not be perfect but this would meet my needs for now.

Dow down by 777

2008-09-29T15:15:00.000-07:00

Triple seven will carry a different meaning after today. According to an article in CNN money, it is the biggest single day drop in the Dow ever. This happened after the failed passage of the $700B bailout plan in the US House of representative. With the US Congress not reconvening till Thursday, we maybe expecting for more drop in the next few days, spreading in the global market.

Even without this recent dip in the Dow, the impact is already apparent. In the UK, there is Nothern Rock and Bradford and Bingley. In Europe, there is Fortis. It looks like no financial institution is safe.

Will we have the same exposure in the Philippines?

Thanks Salve

2008-09-26T14:07:00.000-07:00

Surprise! Surprise!

Back in August, my comment was featured in an Inquirer.Net (Philippine Daily Inquirer) article about making the first million. Now, Salve had again included my entry on doubling your money in the Money Smarts blog.

Funny thing is, I am one of the daily readers of Money Smarts and it is good to know that Salve had a chance to visit my blog. In fact, Money Smarts is the very first blog that I read and had encouraged me to start my own.

Thanks Salve.

Pinoy kasi!

2008-09-21T14:52:00.000-07:00

No matter how often I have hear this phrase I will never accept this as an excuse.

Today, the Botanical Garden here in Belfast had more people than usual because of the Garden Gourmet event. There was an exhibit of agricultural produce and floral displays. There was a children's show that my son lived.

There were also many stalls showcasing different cuisine. Among them is the traditional Irish pork roast or Irish lechon and like before, I did not waste the chance of getting a taste of it. I was really excited until these two Filipina came along.

I was on queue waiting for my turn to purchase when somebody just cut me off and said in Filipino "Balita ko may lechon dito, kukuha lang ako ng balat". As if it was not embarassing enough, a second Filipina came along and did the same to the lady in front of me without saying anything. The lady in a sarcastic tone just said "Go ahead. Help yourself."

I was so embarrassed imagining what people might think. They not only cut the queue but also got most of the cracklings (lechon skin) and did not even bother to purchase anything. To see two Filipinos doing it, I cannot blame them to think that all of us are like that.

I was also angry. In all my life abroad, I tried to behave my best - maybe more than what I would usually do in the Philippines. I understand that how I project myself does not only impact me but will influence how other Filipinos are seen and treated. All behaviour, including those that seem trivial has a greater influence than we could imagine.

I don't want us Filipinos to be seen as beggars and just out here in their country getting on the free ride. If this perception persists, there is a danger that this could fuel discrimination against us. It may seem far-fetched now to think about it but this had already happened to other ethnic groups.

But I still have great respect to and high hopes for Filipino OFWs. In my more than eight years abroad, this is the first time I witnessed such action.

Hopefully this is the only time.

Estimating when your money will double

2008-09-17T14:58:00.000-07:00

A few years back, there were certificate of deposits offered that will double your money if you keep it untouched for five years. It was a good product but none of the banks are offering them now.

If you want to do the same now, do you know what kind of returns should you be aiming? You might be surprised to know how easy it is to estimate.

The rule of 72.

This is a simple formula used to estimate the number of years it will take for your money to double. By dividing the number 72 with the interest rate earned, you can approximate the duration you need to wait. By just reversing the formula, we can determine that you need around 14.4 percent returns to double your money in five years.

Now, let us use the current bank rates (between .5 and 2.5 % return per annum). Based on the rule of 72, it would take between 28 to 144 years to double your money.

Do you think you can wait that long? Or should you be thinking of other ways to invest?

Dow Jones down by 504 points. Lehman bros. on bankcruptcy

2008-09-15T16:22:00.000-07:00

What a day? Earlier, Lehman brothers officially filed for Chapter 11 protection. This initiated a selling spree that ended with the Dow down by 504 points.

Although Lehman bros is in the news, I am not really interested with them. My primary concern is how this will affect other financial institutions. There are already indications that the fear is spreading with the announcement that Merrill Lynch had just closed a deal with Bank of America to preempt the situation.

Now, the attention is with AIG, the biggest insurance company in the world. AIG is pursuing the same strategy of boosting its capital by tens of billions of dollars to forestall the same fate. AIG is asking the Federal Reserve for the money but it looks like the Federal Reserve will not offer a Bear Stearns type of rescue plan. Now, investors are doubtful of the fate of the company that they are selling in droves.

AIG, being a global company have investments in the many part of the world, including the Philippines. AIG's possible fate may have a great impact to its subsidiaries which includes Philamlife - one of the biggest players in the insurance industry.

Philam offers a range of products to a wide base clientele. Among its products is a college plan that I had availed for my son. As of this month, the plan that we bought is one payment short from being fully paid.

I am very concerned as the amount of money involved is significant. What makes it more important is this is an investment to my son's future. Hopefully, we don't have another CAP fiasco in our midst.

First day jitters

2008-09-04T15:41:00.000-07:00

The uniforms were ready more than a month ago. The shoes and the bag were bought by my wife while on vacation in the Philippines. My son had experienced being in a playschool for more than a year in Letterkenny and all the time when they were in Davao. He knows his alphabet and can count up to one hundred (with a bit of help). He knows how to write his name.

In spite of all these, why do we still feel the jitters as parents?

Today, my son started school in Primary 1 here in Belfast. Like most parents, we have the same normal concerns about kids starting school. Can he cope up with the new environment and routine? Will he be ok? All these tensions that started to build up a few days back are all culminating this day.

The day started like any other day. My wife woke up early to prepare our breakfast. My son got up just a few minutes after. We planned to treat it as normal as possible to make our son's transition smoother. But there were some hiccups.

Breakfast lasted longer than expected. It looked as though my son has concerns of his own - hiding a little reluctance about school. Yet he still went through the process of getting ready. It took longer than expected but he did it.

When we were about to enter the school, a bit of mood change came over my son. He started to cling to my wife and looks like he would not let go. I thought this is it but as quickly he got agitated, he had a mood change again and musters enough courage to come in to the school.

Inside, the teacher talked to him and showed him around. With what happened earlier, we thought we would need to stay longer until he gets settled.

But it looks like it was unnecessary. With all the toys around, he did not hesitate when asked if he want us to stay a bit longer, "No need Daddy. I am ok".

There is no doubt my son is now growing up.

A week with Wii Fit

2008-09-02T16:00:00.000-07:00

It has been years since I was into game consoles. I felt I had outgrown it and do not see any benefit from it.

That was then.

After more than ten years, I finally gave in to a Wii console along with the Wii fit. It took us awhile to get it as shops are always out of stock of the Wii Fit. Last Saturday, we got lucky. The night before, Smyths just received a batch and it was almost sold out by lunch time. We were only there by mere chance as their website was still reflecting none in their inventory.

You know what. I am glad we made the purchase as it is pure fun to play with. The best thing about it is that the whole family (me, my wife and five-year old son) can play together.

The Wii fit is also a blast. The game exercises are both fun and challenging. You can set a goal and help monitor your progress towards it. It is like having your own personal trainer at home (well that is how I feel).

So if you want a game console for your family, the Wii console from Nintendo is the I can recommend. And with the Wii Fit, it would make be a good investment.

A note about FAMI Balanced Fund

2008-08-27T17:05:00.000-07:00

Buy low and sell high.

This is a simple advice that I follow on investing. As much as possible I aim for the best price I can get for any purchase. The best thing is when the purchase is below the market value. You may not believe this but such opportunities exist if you are willing to wait.

One of these instances is when a new investment fund is introduced in the market. In the first few months after fund is in the market, the Net Asset Value per Share (NAVPS) usually goes below its book value.

There is no cause for alarm as long as the fund is set up by a reputable company. What had happened here is that the fund is not yet fully invested but already started incurring expenses for its operation. The gains usually comes later.

I was on this assumption when we thought of investing in a relatively new fund - the First Metro Save and Learn Balanced Fund. It currently has a NAVPS value of 92 cents - way below its book value of P1.00. We were about to make our investment when we learned something different about this fund.

Although its NAVPS is just 92 cents, we had to pay the book value of P1.00 if we want to invest. Apparently, this is how the fund was setup. According to its Corporate code and prospectus "No share of the issuer shall however be sold at less than its par value".

I know there are other factors to consider for investing in mutual funds. But in this instance, this is the deal breaker for us as we don't see the opportunity to purchase at a bargain price now and in the future.

Perfect Inheritance

2008-08-15T17:19:00.001-07:00

Reading Salve's Money Smart entry on inheritance, it came apparent that I am not alone. There are many who have the same concerns as I have about what we I would leave my son.

For most, the matter of inheritance can be summed up to a question of amount. The general idea is that we should try to leave as much as we can to provide better chances for our children.

The problem with this strategy is that it fails to consider how children will react to significant inheritance. Even with our best intentions, wealth can create devastating negative impact to our children's lives. Great wealth tends to exaggerate personal character flaws. Too much unearned wealth may provide an incentive to be unproductive and take away ambition. Failing to address this impact is for me an abandonment of our responsibility to our children.

This concern is best summarize by a quote from a Fortune magazine interview with Warren Buffet. The man at the helm of Berkshire Hathaway was said to have described that the perfect inheritance as "enough money so that they (his children) feel they could do anything, but not so much they could do nothing."

This quote focuses more on the legacy we and our children leave to the world. This legacy reflects our values like hard work and responsibility to family and society. This is intended to continue through generations with the wealth only acting as a vehicle towards this goal.

To do this, we must continuously empower our children through financial education with great social-financial awareness. The example we show our children everyday will come a long way in influencing their success. Our legacy does not need to begin at our death.

Warren Buffet is a perfect example of someone leaving a great legacy for his children to follow. He had announced that all his holdings in Berkshire Hathaway will be donated to Bill and Melinda Gates Foundation. This is an unprecedented act of charity that will greatly impact the lives of many.

Four years on....

2008-08-09T17:17:00.000-07:00

It was four years ago from today that I step in a KLM flight in Manila and started my journey as an OFW. My first stop was in Ireland and worked for a company in Letterkenny in Donegal. After more three years of working there, my family decided to continue our journey and moved to Belfast.

Four years is a good time to look back. One thing we most liked about this experience is the opportunity to see new places. We had a vacation in Paris and spent a couple of days in Eurodisney. We saw the changing of the guards in Buckingham Palace during a free trip in London. I spent weekends with my sister and her family in Connecticut during a training stint in the US. We enjoyed this alot that I see us making more of these trips in the future.

There were significant strides on our financial situation. Today, we are truly debt-free. When I left, we have a huge loan for a surgical operation my dad underwent in 2003. This debt was paid off three months in as an OFW using the proceeds from my training in New Jersey in the US and the salary in Ireland. Four years abroad had allowed us to fully pay two properties we bought before marriage. Recently, we purchased three more investment properties with income enough to cover our monthly remittances.

But life abroad is not always happy. The worst thing is the time away from family. This happened to on my first year in Ireland. I missed my son's first birthday, his first Christmas. I missed alot of other firsts. Telephone calls are ok but it's not a substitute to actually sharing the moments with my family.

When I got home a year after to get them, my son does not know me anymore. I was just another stranger that he didn't know. He gets jealous when I am near his mom. Things only started to change when we were back in Ireland and had spent more time together.

And these sacrifices never ends. My wife and son went home without me and spent ten weeks in the Philippines. Gladly, they will be back on Thursday.

Will you invest P100k in an equity fund today?

2008-08-01T16:28:00.000-07:00

We will be getting some extra money two weeks from now and we are not sure where to invest.

In 2003, we invested 65K on a CD from Chinabank. In two weeks, it will be worth 100K. It was a good investment but no banks (none of those who you can trust anyway) are offering interests near what we got (almost 9% interest) so we are looking for an alternative.

My option was to put it a equity fund (MF) but my wife has some concerns. The market is being pounded right now and she fears we might be lose the money. The end seems to be nowhere in sight.

But for me, the downtrend shows that it's not a matter of whether we should invest in equity funds but a question of when to invest. I can wait, anticipate when the market will hit the bottom, and invest at that time. Based on Tsupitero's assessment , the downtrend may continue down to the 2100 level. The last time I checked, the PSEi is at the 2500 level so it may seems that there still a long way to go.

Even in the bearish market, equity fund investments still seems a good investment. What makes it attractive to me is it fits well with buy (low) and hold strategy. Even if the market is in chaos, I don't mind since I don't have any plan to redeem it so my loss is just on paper.

What do you think? Is it wise to go ahead and invest in equity fund or you have a better investment in mind?

Money lesson from my wife

2008-07-26T10:06:00.000-07:00

Leveraging debt is one advice you would often hear from investments books. It simply means borrowing money for investment. Robert Kiyosaki in Rich Dad calls it good debt.

But for my wife, there is nothing good about debt. Whatever reasons you have for incurring it, you still need to pay for it at the end of the day. Debts, however attractive it may seem, is risky. The bigger the amount you borrow, the greater the risk you are taking.

You know, my wife is right. It is now clearly manifested in the current credit crunch. People took on mortgage debts because they believe it makes good sense in the past. Now, many are in default and the impact affects even those who are not in default because of rate adjustments.

There are many OFWs now who bought investment properties in the Philippines. For most, this means taking on a mortgage. This was done because many thought this was the only choice they have.

If you think it over, you will realise that there is another option. If you want the property now but don't have the cash, then mortgage is the only way to get it. But what if we try to have it the other way around - get money first then buy the property. This is how we normally do it with other purchases, why not do the same here.

For us, saving for capital is the right option. It took us about four years but we finally did it - we bought one property last year and currently in the process on closing two more purchases. My wife has a strong belief in this as this what she witnessed her aunts and uncles had successfully done when they were still OFWs like us (now they are retired and enjoying life).

Paying in cash also presents a good advantage. You can negotiate for a better price as long as you can pay in cash quickly. It allowed us to purchase properties below the market value. We even convinced a seller to cover some of the ancillary charges.

Lastly, we have less worries - which is priceless. We have no monthly amortization to think about every end of the month so you won't catch having sleepless nights even if interest rates go up.

Birthdays in Belfast

2008-07-24T16:54:00.000-07:00

No, it's not my birthday. It's my niece's husband and I just tagged along with them.

To celebrate, we went to a Chinese restaurant here in Belfast and had a hearty meal of noodles, duck, tofu and rice. After the meal, we planned to have a drink but I spoiled our chances as the bar would not allow me to enter for wearing rubber shoes. So we ended buying some Guinness and spent the night in their apartment. At twelve and after six cans of beer, I went home.

It was a far cry from what we got used to in Letterkenny. Birthdays is one of the many occasionsPinoys get together. As a custom, you should invite everyone even those you barely know - something that the Filipino nurses had started and continually do. As result, there were at least thirty people in these parties.

In Letterkenny, having a big party was made easy since everyone helps out. Food choices has never been an issue as individuals are willing to bring their signature dishes. Mine is a knock off Hooters Spicy Buffalo Wings and beef with spring onions and green beans. With so much food, parties usually spills over to a lunch the next day.

It would be nice to have the same experience here in Belfast. Sadly, I think this is remotely possible. In the six months I have been here, I noticed that Pinoys held parties here without even inviting Filipinos living in the same apartment complex. It is quite a shame.

If there is one thing I could say I regret by leaving Letterkenny, it would be missing the genuine closeness and sense of community we shared with our friends. Everybody is looking after each other. Everyone is family.

Too much time

2008-07-14T15:04:00.000-07:00

What does a guy do on a Monday but he does not need to go to work yet does not have anywhere to go as most shops are closed?

It is ironic that I have this dilemma of having so much time to kill that I don't know what to make of it. I already used up the first two days of the long weekend doing house chores - cleaning, doing some laundry, pressing my office clothes. I even thrown out some old junks. I didn't want to spend the last day doing some more chores.

I decided to do something different and cook some pinoy kakanin using whatever ingredients that is available.

I started scouring around the kitchen and the first thing I saw was malagkit (glutinous rice). First thought was to make biko so I started looking for coconut milk and I found a can on top of the fridge. The other ingredients (sugar and vanilla) are not a problem as these are readily available.

I was about to get going with it but I paused. While looking for the vanilla, I saw a pack of Ricoa breakfast cocoa on the shelf. Then it struck - what goes best with sikwate?

Para sa mga bisaya, puto maya. Wala nay lain.

I haven't done this before so I surf for a suitable recipe from the internet. I chose one from wanderlust sha as she is a Bisdak like me. I used the same ingredients (listed below) and followed the steps she suggested - even the bit like making latik from the coconut milk.

2 cups glutinous rice
4 cups coconut milk
1 cup sugar
ginger (an inch or so)

And in just a few minutes, I am back in the palengke in Bankerohan in Davao - enjoying my puto maya with my sikwate.

It turned out really good. And it was simpler and did not take so much time to make compared to biko. My only disappointment is I forgot to put some tapol to give it a purple color. It would have been more authentic.

Maybe next time.

It's just a celebration

2008-07-12T15:30:00.000-07:00

It is 11:30 in the evening now and the only sound I hear is the sound of a street sweeper. Nothing more reassuring than that.

Today's celebration ended without a hitch. As I saw from the BBC broadcast, the parade went on without any incident. Many spectators that includes alot of children were enjoying the parade. There were also some tourists who specifically came for the celebration.

It is a good sign for me. It meant that my decision to move here is not bad (but I can't really say for sure that it is for the best). Belfast has moved on - away from the violence of its past. People may still have disagreements but at least there seems to be true respect between factions.

This is maybe something Filipino politicians can learn - that they have to move on and focus on the task at hand. They should set their differences aside and work together. The Belfast leaders from opposing factions did so and the people followed. Now, everyone (including me) is benefiting from economic gains resulting from this collaboration.

It is sad to see how petty the basis of our political divide compared to what they have here in Belfast. Ours is solely based on party lines while theirs are cultural and historical based disagreements. Despite this, they learned to share power and in turn share the responsibility of governance.

I doubt our leaders can do the same.

Belfast on fire

2008-07-11T16:42:00.000-07:00

This is the scene I see through my bedroom window.

There is a huge fire in the middle of the street a few hundred meters from where I live. A few hours earlier, there was one in a nearer residential estate. I can hear people screaming and sirens going off every now and then .

Apparently this is normal. People in many parts of Belfast (and other areas in Northern Ireland) light up their own huge bonfires. They have done so in the past years and this year is no different.

Welcome to the Twelfth of July Orange Order celebration marking the victory of the Protestant Prince William of Orange over the Catholic King James II at the Battle of the Boyne in 1690. This is the reason why Monday is a bank holiday.

I have read about this before but this is the first time I am here in Belfast to see it. Coming from the Philippines, I am not really easily fazed. I have seen my share of tire and bus burning. I have witnessed street protests and eventual violent dispersion by the police.

Besides, tonight's celebration is relatively calm. There is just your usual bonfire. The bands had their practice run. A lot of people getting drunk. All in a celebratory mood.

Still, there is cause for concern as this may easily escalate into chaos. Not so long ago in 2005, Belfast was in the news for the riots that erupted. It all started during the confrontation of the two groups with opposing political and sectarian views during the parade.

The parade is scheduled for tomorrow. Let's see what will happen then.

Another bank holiday weekend

2008-07-11T15:02:00.000-07:00

It's a beginning of another long weekend here in Belfast. It's a bank holiday on Monday so there's an extra day off.

The last time we had one in May was for the Spring bank holiday. Part of the celebration was the Continental Market showcasing products from the continental Europe and here in Ireland. There's your usual German sausages and beer, French crepes, smelly cheese from different countries, exotic meat and oil.

But there was a pleasant surprise right in the middle of the Belfast City Hall grounds - a stand selling lechon. It was not really the lechon as we know of but it was close enough. The Irish traditional roast pork (that what it is called) has the same crispy skin but a bit bland compared to what we have in the Philippines.

And yes, they serve it in a bun.

This weekend is different. There's no festival. Even there is one, I will not be able to enjoy it as my family is in the Philippines. Shops are closed so I know I will be staying home for most of the weekend.

Real estate deals with family

2008-06-26T14:37:00.001-07:00

I never thought that buying properties from family members can get very complicated. Being a part of the family, these transactions involve a different kind of dynamics. You are expected to provide more leeway than you normally would.

The price for instance. Although people will not admit it, one of the reason they seek buyers within the family is that they expect to get a good price. For properties, the minimum price is their idea of its market value. Not the real market value but a valuation based on some questionable source - valuation from neighbors, unverifiable sales price for a property been sold in the area.

Others don't think of the transaction as a sale. The property is treated as a collateral for a loan. If they do decide they want the property back, you are expected to sell it back. Here's another kicker - they expect to pay the original amount you lent them regardless how long ago it was.

If these are not enough to put you off, then you must take steps to protect yourself. From my experience, these are the things you have to do.

Establish how much you are willing to pay for the property. This is the true value of the property for you. This may not be anywhere near the market value but you have to stick with it. Remember that by buying this property (which you may not be interested of in the first place) meant that you are foregoing better opportunities that may arise.

Make the transaction legally binding and final. Document everything like any business transaction. It may incur some additional cost but at least this can help manage everyone’s expectations.

Involve all stakeholders. This is important on conjugal properties and those that involves children.

Do not part with your money unless everything is signed and in order. I once had an experience of people wanting more money for properties supposedly paid for a few years back. Being so trusting, I thought everything was final even though I don't have any document on my hand. In these cases, you only have three choices - pay more, sue or walk away. Regardless which one you choose, all are disadvantageous.