Below is a good article of Bo Sanchez on this great habit for investors – an easy way on how to invest in the Philippine Stock Market.
I have a friend who retired 7 years ago.
Let’s call her Lola Penny.
Actually, her real name was Lola Penang. She took a vacation in
America, when she came back, she was now called Lola Penny.
Lola Penny is a widow with 4 children and 6 grandkids.
For 38 years, Penny worked as an accountant, crunching the numbers for
her company. Because she was such a good accountant, she was promoted
many times and became the manager of the entire department.
And she was earning very well.
But Penny told me that even if she was earning very well, she was living from paycheck to paycheck.
Which brings me to a very important principle:Income does not equal Wealth. It’s not how much you earn that makes you wealthy. It’s how much you investfrom what you earn that makes you wealthy.
Yes,
she saved some money. But like most Filipinos, she saved only for the
big expenses: She saved to buy a house. She saved to pay for the
schooling of the kids. She even saved for the wedding of the kids. But
she failed to save for the biggest expense of all: Retirement.
Like many, she totally depended on the retirement package from her company.
When she retired 7 years ago, Penny got P3 million.
For the first year, it was heaven on earth.
Every Sunday, she brought her grandchildren to the mall to buy them toys.
And when her children needed money, they’d run to her.
“Mommy, can we borrow money to repair our car?”
“Mommy, we lack P20,000 for Junior’s tuition fee. Can you help?”
“Mommy, your apo (grandson) will compete in a swimming competition in Singapore. Can you pay for his plane fare?”
But very quickly, her money ran out.
After 7 years in retirement, Lola Penny was penniless.
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