The Right Formula 

            Some people have this problem:

            "I've been working hard all my life but i wasn't able to save anything. Where did my money go?"

               Have you ever asked yourself this question? If you have, maybe it's because you have been using the wrong formula for saving 

              Warren Buffet, one of the wealthiest men in the world, gives this advice, "Don't save what is left after spending; spend what is left after saving." In other words, you pay yourself first.

            This is the correct formula for savings
            INCOME- SAVINGS= EXPENSES 

             Before you spend, you need to save first. But there is an even better formula. 

              INCOME- TITHES- SAVINGS= EXPENSES 

 TITHES

              Tithes is the money you give to the church or an organization that nurtures your spiritual growth. As a guide, the amount of tithe is 10% of your income. Of course, you can always adjust the percentage depending on your preference or capacity. 

PAY YOURSELF FIRST

              Set aside 20% of your income to save for your future. If possible, save 20% or more. Treat it like a bill that you must pay, and pay it first. That's your "Family Financial Future Bill." Doesn't it make sense to pay your family first before paying other people's bills? Your cell phone load or your electricity is not more important than your family's financial well-being. 

EXPENSES

                  The 70% of your income will go to your expenses, bills utilities, foods transportation etc. Try to prioritize your expenses base on needs vs wants.

Small Savings, Big money                                                                                                                                                                                                                                                                                                                                                                                                                                 Spending is a habit and so is saving. What if you could make small changes in your spending habits? Start saving Php10 a day- that's Php300 in a month! Your Php300 Per month savings can become Php447,107 in 30 years at 8% interest annually. Save Php20 a day or Php600 a month and you will have Php894,214 in 30 years at 8% interest annually.

                   One way to increase  your savings is to reduce your expenses. Delay your gratification. Can you sacrifice small, personal luxuries today so you can reap greater rewards and benefits in the future? 

                    You may cut down on things like soda, coffee, bottled water, cigarettes, cable TV, high-end gadgets and phones, shopping, fancy cars, eating out, partying, etc.

                     Remember, it's not how much you earn that counts. It's how much you keep. One of the common traits among rich people is that they are very conscientious when it comes to pending.

            A classic case is a young couple who gets married, has children, and buys a house. With mortgage and new expenses, money becomes tight. They tell themselves they will start saving later. 

             As they enter mid- life, their children go to college. This time, it's the tuition fees that takes a big bite out of their budget. Soon, the parents will join the majority of people approaching retirement with little or no savings. They know they must save, but now they say it's too late.

             Do you know that if you set aside 1,000 pesos every month, you will become a millionaire in 23 years at 10% interest each year.

             By that time, you would have set aside only Php276,000 but your money would grow to Php1,049,967.92!  

             Don't wait. Start to save as much as you can as soon as you can.

  Mr. Save Early vs. Mr.Save Later

              As you can see, Mr. Save Early and Mr. Save Later each invested P120,000 over a period of 6 years. However because Mr. Save Early started 6 years earlier, he made P9,597,920. Meanwhile Mr. Save Later, who started to save the same amount of money 6 years later, made only P4,862,610 when they both reached the age of 62. Mr. save Early made P4,735,320 more than Mr. Save Later!

              Start saving today!

   Your Two Options:

               a. Save now and enjoy later 
               b. Spend now and suffer later 

   Get Rich Slowly 

              A solid foundation takes time to build. Trees don't grow big overnight. Avoid get rich-quick impulse. Hot stock and rising real estate markets can sound appealing. But one wrong pick can set you back big time from your saving goal.

                 Investing is not gambling. You must understand how money works, have a plan, and stay disciplined with your action plan until you reach your goal.