Friday, July 6, 2007

Are You Financially Literate?

Being a graduate of BS Accountacy, I thought I know about money. Wrong! Actually, I know I have been brainwashing myself with that lie but deep inside I know I am incompetent nincampoop! What I know is to record, analyze and think but no action. I even don't have a first hand experience with it.

Until I got my first experience in so called business big time (at least for me). We were so overwhelmed by the emotional complication of accounting for our business that we ignored accounting for it all together! Then after a few months, we found ourselves in debt. Luckily we only have debts up to our waistline.

I have thought of running away from it (bad girl!) but I thought better. In the future, I will need the credit lines I have acquired. And I have turned the experience into a learning process, an expensive one but just as well effective.

So far, I realized that I have a very poor financial quotient. I began thinking ways on how I could learn. From the MLM that we got involved, we took their best advice, "Learn from the Masters". But where I could find one?

It began on a journey for answers. I am a bookworm and actually don't have enough rich people on my COI (circle of influence). I was ready for new suggestions or ideas. I actually been praying to God to show me something. I said "God, please show me the best book I can read". Then on the shelves are books that I haven't seen open to bookstore visitors' reading but often of the best seller bookstand.

I read to my heart's content. I am broke but out of pure instinct, I know I got to own these books. I love the book because its the first time I heard about it from a fellow Filipino and the standing of getting rich on a Christian's point of view was clearly defined here. The idea is the same that I have developed through out the years but sadly, these ideas are so radical for our conservative teachings at my old Catholic School that I distanced myself from it and went on my own having only one on one relationship with God.

Anyway, I know I its hard but I have to be strong. I began analyzing my financial position. Here some of the steps I have done.

  1. Reconstruct loans - Stop using that credit card! Freeze it! I found out that my bills are higher than my monthly pay. I can't afford it. I looked for some credit cards that offer "balance transfer" which allows you to pay your bills on a much lower monthly payment with a fixed amount. From the usual credit card interest of 3.5%, you could pay your bill for fixed 1 year with only 2.5 %. A little bit high still but you have saved your self from the dreaded invisible interest expense.
  2. Cut on bills - I began using my cellphone less and less. I have installed yahoo messenger on my computer ( I am online always at work) and just send important messages via YM. I also began bringing lunch boxes at work. That way, I also control my voracious appetite and stay away from certain foods by cooking healthy recipes at home.
  3. Read financial literarcy books - Read people! Through Bo Sanchez's 8 Secrets of the Truly Rich, I was introduced to Larry Gamboa's Think Rich Pinoy and Grow Rich Pinoy. And I got to finally understand why I've been seeing Rich Dad, Poor Dad by Robert Kiyosaki is constantly on bestseller bookshelves.
  4. Pay myself first - Its a hard thing to do especially when the bills are filing up. But if you read Rich Dad, Poor Dad, you will see the better light of the concept.
  5. Find the best mentors - I am still looking for the best person for this one. I have inquired so far (actually just yesterday) and so far, none have still answered so far. I have to keep looking still.
  6. Practice what I have learned - I am still on this process. So stay tuned. :)
I finally acknowledged that I am a financial illiterate. But I am proud to say, I am soon on my way to become one of the best financial adviser. This is my contribution to the First World Philippines.

How about you? Are your Financially Literate?

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