The Hound of the Wolf

For the strength of Pack is in the Wolf, and the strength of Wolf is in the Pack -Rudyard Kipling

Thursday, January 15, 2009

100% x 1 > 100% of self

Leveraging using other people's resources is one of the cleverest way of building financial resources. Mutual funds is a good example of this. While looking at the recent annual mutual fund report at PMT, NAVPUS aren't getting better nowadays. MF's as far as the experts are saying will always rebound after downfalls but might take some 3-5 more years. This is good for long-term investments (5-10 years of leaving the principal amount untouched). In as much as I wanted to enroll in a mutual fund, I cannot.

My mind and bravado is pushing me to embark to a microfinancing venture this summer. This is part of a personal grand plan of shunning away from the "employee" mindset and transitioning to business and entrepreneurial mindset. Considering the need to diversify the resources, situation has led to jump into instruments that are:

1. provides interest rate that beats the 4-5 percent annual inflation rate
2. preserves and liquidation of the principal. i don't have the appetite yet to lose lots of bucks
3. generates regular passive income. let thy bucks work for you.
4. encourages capital expansion and thereby, an increase in interest

Mr. Francisco Colayco, a famous Pinoy financial advisor, labeled this as the build-up stage in growing wealth. I will be employing 'bakas' scheme or using other people's money as leverage in my upcoming venture. Obviously, P100,000 will provide better returns than P10,000. Only few daring individuals are willing to put P100K on a one-shot investment scheme. It will be more easier and less intimidating to shell out P10,000 for working Pinoys with average earnings given sufficient amount of time. Pooling small amounts of money from other people is more practical than shelling out a the same amount but all from my personal bank account if one wanted to enjoy higher returns. It reduces risks, while helping out other people to earn more than what the conservative commercial banks are giving.

The next few months are quite exciting. I've learning from investment experts and for quite some time now it's time for me to execute my plans. Looking back from my entry one year ago about savings and investments, it is encouraging that I've exceeded my annual target. Like a wolf whose appetite increases every time it smells blood, my addiction to investment and money-making is just starting warm-up.

Learning investments is not rocket science. A clear and solid plan is enough. Combine it with hard work, persistence, patience and prayer, proper results should fall into place.

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